India Files Appeal Against WTO Panel Report On Tech Tariff Issue With EU

India has notified its decision to appeal the panel report on technology tariffs in a complaint filed by the European Union with the World Trade Organisation.

In May, India appealed against a similar report in the case initiated by Japan, making this the second appeal.

Three panel reports by the dispute settlement body of the WTO were circulated to members on April 17 after complaints from the EU, Chinese Taipei (Taiwan) and Japan regarding India's tariffs on information and communication technology products. The panel reports ruled that India's import duties on certain IT products are inconsistent with global trade norms in all cases. India and Taiwan have deferred adopting the panel report until April 26, 2024.

India's second appeal in the case against the EU was circulated to WTO members on Dec. 14, according to the latest information from the trade body.

NDTV Profit had previously reported that India would likely file an appeal after the WTO's dispute settlement panel, on April 17, ruled against the country in the cases initiated by three country blocs—the European Union, Japan and Taiwan—in 2019.

The timing of India's appeal comes after the EU and India were engaged in Mutually Agreed Solutions (MAS) negotiations over the last seven months. On December 7, 2023, the EU filed to adopt the panel report and subsequently, India filed its appeal. The value of EU imports into India for the year 2022 came up to $340.15 million.

India's argument is that its tariffs do not violate the Information Technology Agreement signed in 1996, and levies on some products, like smartphones, that are contested were only subsequently defined and not originally covered.

The appeal comes at a time when India was expected to resolve the WTO import duty dispute with the European Union on certain information and technology products through the proposed free trade agreement, which is under negotiation.

The India-EU FTA negotiations were formally relaunched on June 17, 2022, as a follow-up to the announcement made by the Indian and EU leaders in Porto, Portugal, on May 8, 2021.

According to data from the ministry, the sixth round of negotiations was held between Oct. 16 and 27, during which both sides extensively discussed goods, government procurement, trade and sustainability, energy and raw materials, technical barriers and rules of origin, among other chapters.

What Happens Now?

An appeal on a report from the dispute settlement body leaves the matter to the WTO appellate body, which is currently not functioning. The appointment of new judges to the appellate body has been halted by a few member countries, like the United States, which has cited issues like judicial overreach. This leaves panel reports like the one being appealed in the void and unresolved.

"Given the ongoing lack of agreement among WTO members regarding the filling of Appellate Body vacancies, there is no Appellate Body Division available at the current time to deal with the appeals," the WTO said in a release informing India's appeal on its website.