WT/TPR/M/313/Add.1 31 July 2015 (15-3978) Page

275 Pages·2015·1.31 MB·English

WT/TPR/M/313/Add.1

31 July 2015
(15-3978) Page: 1/275
Trade Policy Review Body Original: English/anglais/inglés
2 and 4 June 2015

TRADE POLICY REVIEW
INDIA
MINUTES OF THE MEETING
Addendum
Chairperson: H.E. Mr. Paparizov (Bulgaria)
This document contains the advance written questions and additional questions by WTO
Members, and replies provided by India.

Organe d'examen des politiques commerciales
2 et 4 juin 2015
EXAMEN DES POLITIQUES COMMERCIALES
INDE
COMPTE RENDU DE LA RÉUNION
Addendum
Président: S.E. M. Paparizov (Bulgarie)
Le présent document contient les questions écrites communiquées à l'avance par les
Membres de l'OMC, leurs questions additionnelles, et les réponses fournies par Inde.

Órgano de Examen de las Políticas Comerciales
2 y 4 de junio de 2015
EXAMEN DE LAS POLÍTICAS COMERCIALES
INDIA
ACTA DE LA REUNIÓN
Addendum
Presidente: Excmo. Sr. Paparizov (Bulgaria)
En el presente documento figuran las preguntas presentadas anticipadamente por escrito y
las preguntas adicionales de los Miembros de la OMC, así como las respuestas facilitadas por India.
WT/TPR/M/313/Add.1

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CONTENTS
ARGENTINA ...................................................................................................................... 4 
AUSTRALIA ...................................................................................................................... 6 
BRAZIL ........................................................................................................................... 19 
Additional Questions ......................................................................................................... 23 
CANADA ......................................................................................................................... 24 
Additional questions ......................................................................................................... 47 
CHILE ............................................................................................................................. 49 
CHINA ............................................................................................................................ 51 
Follow-up Questions ......................................................................................................... 62 
COLOMBIA ..................................................................................................................... 67 
COSTA RICA ................................................................................................................... 75 
DOMINICAN REPUBLIC .................................................................................................. 77 
ECUADOR ....................................................................................................................... 79 
Additional Questions ......................................................................................................... 82 
EUROPEAN UNION ......................................................................................................... 86 
Follow-up Questions ....................................................................................................... 115 
GUATEMALA ................................................................................................................. 124 
HONG KONG, CHINA ..................................................................................................... 125 
INDONESIA .................................................................................................................. 128 
JAPAN .......................................................................................................................... 141 
KENYA .......................................................................................................................... 150 
REPUBLIC OF KOREA .................................................................................................... 151 
MALAYSIA .................................................................................................................... 154 
Additional Questions ....................................................................................................... 155 
MEXICO ........................................................................................................................ 167 
NEW ZEALAND ............................................................................................................. 172 
NORWAY ...................................................................................................................... 175 
OMAN ........................................................................................................................... 179 
PERU ............................................................................................................................ 180 
Additional Questions ....................................................................................................... 186 
PHILIPPINES ............................................................................................................... 187 
RUSSIAN FEDERATION ................................................................................................. 188 
KINGDOM OF SAUDI ARABIA ....................................................................................... 190 
SINGAPORE .................................................................................................................. 192 
SWITZERLAND ............................................................................................................. 195 
Follow-up Questions ....................................................................................................... 204 
CHINESE TAIPEI .......................................................................................................... 205 
THAILAND .................................................................................................................... 213
WT/TPR/M/313/Add.1

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TRINIDAD AND TOBAGO .............................................................................................. 216 
TURKEY ........................................................................................................................ 218 
UNITED STATES OF AMERICA ....................................................................................... 224 
Follow-up Questions ....................................................................................................... 267
WT/TPR/M/313/Add.1

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ARGENTINA
I. Questions on the report of the Secretariat (WT/TPR/S/313)
Paragraph 3.1

Paragraph mentions that since its last Trade Policy Review in 2011, the main changes in customs
procedures include the adoption in 2011 of a self-assessment system aimed at facilitating trade.

Question 1: Could you elaborate on this new system of self-assessment and describe how would
it facilitate trade?

Reply: Under the self-assessment regime, the importers/exporters are mandated to assess
Customs duty on their own. This self-assessment is subject to verification in terms of its
correctness. A Customs. Risk Management System (RMS) enables interdiction of consignments
based on risk associated with it and balance consignments are facilitated by the Customs without
examination and reassessment. Post Clearance Audit/ Post Clearance Compliance Verification
(PCCV) is undertaken after release of goods.

The objective of introducing self-assessment is to repose faith in trade with resultant reduction in
dwell time and transaction costs. After introduction of self-assessment the level of facilitation
i.e. the number of consignments that are cleared by Customs without examination and
reassessment has increased.

Paragraph 3.18

The report explains that customs duties are applied and collected under Article 12 of the Customs
Act 1962 and Customs Tariff Act of 1975. The basic type is the legal right prescribed in the First
Schedule annexed to the Customs Tariff Act. Legal right changes are announced with the annual
budget at the end of February each year (in India, the fiscal year runs from April to March).
However, the "effective" tariff rate applied in a given year can be very different from the legal right
due to exemptions set forth in general terms or in terms of "end user" (reducing the base rate for
some users) as well as tariff adjustments made by notices published in the Gazette of India, which
can decrease or increase the basic rate. Therefore, the effective rate can vary throughout the year
as a result of these changes, which increase the complexity of the tariff and cause uncertainty for
traders.

Questions 2: a) Could you explain in more detail why the "effective" rate of duty applied at a
certain time of year can be very different from the statutory duty?

Reply: The statutory rate of duty is the rate prescribed under the Customs Tariff Act, 1975.
However, under Section 25 of the Customs Act, 1962, the Central Government is empowered to
grant exemption from the tariff rate of duty [effective rate of duty]. Accordingly, keeping in view
the interests of the domestic industry and consumers and emergent conditions, the government
specifies ‘effective’ rates of duty.

Paragraph 3.20

In this paragraph, the report mentions that in the case of lines that alternate duties apply, the
Secretariat has used only the ad valorem part of the types to determine fees. Could not have AVEs
and, moreover, the specific types include all product-specific exemptions announced during
2013-2014, until 1 September 2014; However, since India grants exemption to a number of
products based on the end user, it is not possible to include all exemptions to perform the analysis
of the tariff.

Question 3: Could India explain what is the reason why the Secretariat could not have AVEs?

Reply: Ad valorem equivalents of specific rates of duty are not possible since the equivalents
would depend on the prevailing customs value of the particular item. However, the rates of duty
on these items are within the WTO Bound rates.
WT/TPR/M/313/Add.1

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Paragraph 3.31

In this paragraph the report states that under Article 25 of the Customs Act 1962, the Central
Government may partially or totally exempt from payment of customs duties on imports by
notification in the Official Gazette, in the general or under certain conditions.

Question 4: Could you explain in what cases the Central Government may partially or totally
exempt imports from payment of customs duties?

Reply: The statutory rate of duty is the rate prescribed under the Customs Tariff Act, 1975.
However, under Section 25 of the Customs Act, 1962, the Central Government is empowered to
grant exemption from the tariff rate of duty [effective rate of duty]. Accordingly, keeping in view
the interests of the domestic industry and consumers and emergent conditions, the government
specifies ‘effective’ rates of duty.

Paragraph 3.45

In this paragraph the report states that the licenses are valid for 18 months and the competent
authority can extend them for a period of six months, depending on the circumstances; imported
material must be used by the importer and cannot sell.

Question 5: What are the specific circumstances under which licenses may be extended for
another six months?

Reply: Regional offices of DGFT extend validity of authorization for another six months at the
request of the applicant in cases where imports could not be completed in time.

Paragraph 3.51

In this paragraph the report states that India imposes import quotas and the like marble stones
(SA 25.1511 million and 25.15121 million) and sandalwood (SA 44,039,922). The quotas are
administered each year and MFN. There is no maximum allowable limit per applicant. Applications
are examined when received and evaluated according to the criteria specified in the notifications
and circulars issued each year by the DGFT.

Question 6: Could India provide details of the procedure for applications for import quotas?

Reply: The procedures are as per notification No 99 dated 20.11.2014, available on the DGFT
website (www.dgft.gov.in)
WT/TPR/M/313/Add.1

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AUSTRALIA
Report by the Secretariat - WT/TPR/S/313

1 ECONOMIC ENVIRONMENT
1.5.1 Composition of trade in goods
Page 19, Paragraph 1.15

Question 1: Can India please provide the value, volume and main destinations of buffalo meat
exports since the last Trade Policy Review of India? What proportion of total agricultural exports
have been buffalo meat exports, for each year, since the last Trade Policy Review of India?

Reply: Since the last Trade Policy Review of India in 2011, the details of the buffalo meat exports
are as under:
Buffalo Meat Exports of India
2014-2015
Buffalo Meat Exports 2011-2012 2012-2013 2013-2014
(P)
Value (US$ Million) 2842.83 3201.14 4350.23 4781.18
Volume (Qty in '000 984.96 1076.1 1365.64 1475.54
Ton)
Main Export Vietnam; Vietnam; Vietnam; Vietnam;
Destinations - Top 5 Malaysia; Malaysia; Malaysia; Malaysia;
export destinations of Egypt; Saudi Thailand; Egypt Egypt; Thailand Egypt; Thailand
Buffalo Meat Arab & Jordan & Saudi Arab & Saudi Arab & Saudi Arab
Proportion of Buffalo 7.57 7.67 10.06 12.24
Exports of Total
Agricultural exports
(in terms of Value in
US$ Million)
Note: Total Agricultural exports include Plantation, Agriculture & Allied Products, Marine Products, Raw
Hides And Skins, Other Wood And Wood Products, Silk Raw, Wool Raw, Jute Raw, and Cotton Raw
Including Waste.

Source: DGCI&S, Kolkata

2 TRADE AND INVESTMENT REGIME
2.3.1 WTO
Page 27, Table 2.1

Question 2: Can India explain why its notifications to the WTO Committee on Agriculture in 2014
were expressed in terms of US Dollars (USD) rather than Indian Rupees (INR), especially as
India’s AGST requires that INR be used, as INR was used in India’s previous notifications, and as
domestic support measures is actually provided in INR rather than USD?

Reply: Notification of domestic support in US dollars since 1995-1996 has been done in order to
provide comparable estimates of the support. India has followed a consistent approach with
respect to currency used when notifying its domestic support notifications.

Question 3: Can India explain why it doesn’t use total production as eligible production when
calculating market price support?

Reply: India does not procure all the commodities for which MSP is announced. Besides,
government does not procure food stocks at administered prices in all the States. Farmers bring
their produce for procurement by government agencies only in the event of the market price falls
below the Minimum Support Price announced by the government. Thus, only those farmers are
benefited whose produce is procured by government agencies. It is for this reason that the
WT/TPR/M/313/Add.1

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quantity procured by government agencies at Minimum Support Prices is taken as the eligible
production.

3 TRADE POLICIES AND PRACTICES BY MEASURE
3.1.4.1 Applied tariffs
Page 39, Table 3.3

The Secretariat’s report indicates that the average MFN applied tariff rate for agricultural products
in 2014-15 was 36.4 per cent.

Question 4: Can India provide the simple average MFN applied tariff for agricultural products for
each of the last 10 years that data is available?

Reply: This data is available is various issues of the publication ‘Tariff profiles’ brought out by the
WTO Secretariat every year.

3.1.7 Tariff rate quota
Page 44, Paragraph 3.33

Australia understands that India is the largest producer of milk in the world and its milk production
continues to increase. Demand continues to outstrip domestic supply and domestic prices are high
by world standards.

Question 5: Can India advise the basis for maintaining tariff rate quotas for milk powders?

Reply: The TRQs are part of India’s scheduled commitments. Apart from having to fulfil certain
conditions, importers are free to decide whether or not to avail of these quotas, based on demand,
commercial viability and other relevant factors.

3.1.9.4 Import quotas
Page 51, Paragraph 3.51

The Secretariat’s report notes that India maintains import quotas for sandalwood. Australia
understands that demand for sandalwood outstrips demand.

Question 6: Can India advise the basis for maintaining import quotas for sandalwood?

Reply: Sandalwood trade is regulated in many countries including India as it is considered a highly
restricted tree species. India has put import of Sandalwood under restricted category keeping in
view the objectives of conservation of this rare tree and ensuring fair and legal trade. India allows
imports of specified quantity every year subject to production of a certificate from the Government
authorities of country of export stating that export of sandalwood is legally permitted from the
concerned country. In addition, India also requires, the ‘Certificate of Origin’ from the country of
export and phytosanitary certificate

3.1.10 State trading
Page 52, Paragraph 3.55

The Secretariat’s report indicates that exclusive rights to import 11 agricultural products were
removed from the Food Corporation of India on 29 September 2014.
Question 7: Can India advise whether this means that any company can now apply to import these
products?

Reply: Yes, any company can apply.

Page 52, Paragraph 3.56

Question 8: Can India describe what activities are undertaken by the Indian Sugar Exim
Corporation Limited state trading enterprise to promote both exports and imports of sugar into
India?
WT/TPR/M/313/Add.1

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Reply: Indian Sugar Exim Corporation Limited (ISEC) is a joint body of the two Apex Associations
of the Indian Sugar Industry viz. Indian Sugar Mills Association (ISMA) and National Federation of
Cooperative Sugar Factories (NFCSF) which represents over 550 sugar mills in the country.
Till sugar season 2013-14, ISEC has been a State trading agency for execution of preferential
quota for sugar exports to European Union and USA. ISEC has also helped small sugar
companies/cooperative societies to find buyers for their sugar export or help them by importing
raw sugar whenever need arises. It has also helped them with the logistics and financial support.

3.1.11 Anti-dumping, countervailing, and safeguard measures
Page 53, paragraph 3.59

Question 9: Australia understands that changes were made to legislation including introducing
new rules defining situations that are considered to represent the circumvention of anti-dumping
duties, and providing for anti-circumvention investigations to address such circumvention.
What types of circumvention activity were added to the legislation and what parties are eligible to
apply for an investigation?

Reply: No. 6/2012-Customs (N.T) dated 19th January, 2012 by introducing Rule 25 to 28 in the
Anti-dumping Rules. These are available in the public domain (http://www.cbec.gov.in) and have
also been notified to WTO (WTO document G/ADP/N/1/IND/4, 1 March 2012). Under the said
Rules, the following types of activities amount to circumvention of anti-dumping duty when goods
are imported in to India:

Import of goods, subject to anti-dumping duty, in an unassembled, unfinished or incomplete form
and assembled, finished or completed in India or in such country to avoid payment of
anti-dumping duty.

Imports of goods, subject to anti-dumping duty, by altering its description, name or composition.
Imports of goods subject to anti-dumping duty through exporters or producers or countries not
subject to anti-dumping duty.

The domestic industry is the eligible party to apply for circumvention investigation under the
Rules.

Pages 53-54, paragraph 3.60, section 3.1.11:

Question 10: Australia understands that the Directorate General of Anti-Dumping and Allied
Duties (DGAD) is able to self-initiate mid-term and sunset reviews. What percentage of mid-term
and sunset reviews were self-initiated by the DGAD during the review period? What factors led the
DGAD to self-initiate these reviews? Do these factors differ from a request by an interested party
who submits positive information substantiating the need for such review?

Reply: During the period of review, DGAD has not self-initiated any midterm or sunset review.

Page 55, paragraph 3.63, section 3.1.11:

Question 11: It is unclear from the description of the application of provisional measures from
which stage of an investigation India can impose provisional measures. The paragraph states that
the following the preliminary finding at day 150 the authority may decide to impose provisional
measures. The next sentence says provisional measures may be imposed from day 60. Could the
time period from which provisional measures are imposed be clarified?

Reply: Under the Anti-dumping Rules, there is no prescribed time period for issuing preliminary
findings. However, the Anti-dumping Rules provide that no provisional duty shall be imposed
before the expiry of sixty days from the date of initiation of an investigation.
WT/TPR/M/313/Add.1

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Page 56, paragraph 3.67, section 3.1.11

Question 12: In regards to the DGAD self-initiating a mid-term or particularly a sunset review, is
an investigation always conducted, or are questionnaires from local industry and comments from
other interested parties sometimes solely used to determine if there is sufficient grounds for
continuation of the measure in force?

Reply: During the period of review DGAD has not self-initiated any midterm or sunset review.
Normally, the Designated Authority initiates the proceedings for anti-dumping action on the basis
of a petition received from the domestic industry alleging dumping of certain goods and the injury
caused to it by such dumping. Rule 5(4) of the anti-Dumping Rules provides for suomoto initiation
of anti-dumping proceedings by the Designated Authority on the basis of information received from
the Commissioner of Customs or from any other source.

3.1.12.5 Labelling
Page 62, Paragraph 3.103

The Secretariat’s report advises there is no mandatory labelling requirement for genetically
modified products. Australia understands that the Legal Metrology Act 2009 mandates labelling of
genetically modified foods and that this act applies in addition to regulations covered by the Food
Safety and Standards Act 2006.

Question 13: Can India clarify requirements for labelling of genetically modified food?

Reply: Import of Genetically Modified Food is being governed by DGFT Notification No.2 dated 7th
April, 2006, details of which are available at www.dgft.gov.in. However, the provisions relating to
the Genetically Modified articles of Foods, as mentioned under Section 22 of the FSS Act, 2006,
are in the process.

3.1.13 Sanitary and phytosanitary requirements
Page 62, Paragraph 3.104

The Secretariat’s report notes that the FSSA is intended to increase transparency of the scientific
basis upon which India’s SPS measures are adopted through, inter alia, harmonization with
international standards. Australia understands that in early 2013, India advised that the process of
harmonising its food standards with Codex Alimentarius standards would be finalised by the end of
2014.

Question 14: Can India provide an update on the process for harmonising its food standards with
international standards?

Reply: Draft Notifications have been issued in respect of naturally occurring toxic substances (5th
December 2014) and aflatoxins (9th April, 2015) for inviting stakeholder comments. These have
also been notified to WTO-SPS committee.

As regards the harmonisation of standards for additives, pesticide residues and heavy metals with
those of Codex, they are in the process of harmonisation, would be notified to WTO Secretariat on
completion of the process.

3.2.6.2 Export-oriented units
Page 71, Table 3.17

Question 15: Can India provide a further breakdown by product, or product category, for the
exports from Export-oriented units in the food/agriculture/forestry sector for the years referred to
in table 3.17?

Reply: Breakdown of Export data by product or product category wise from Export-oriented Units
in the food/agriculture/forestry sector for the years referred to in table 3.17 is not readily
available.
WT/TPR/M/313/Add.1

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3.2.7 Export finance, insurance and guarantees
Page 72, Paragraph 3.152

Question 16: Can India advise whether the operations of the Export-Import Bank (Exim Bank) of
India extend to provide support for trade in agricultural goods? If so, can India please provide a
list of the agricultural goods supported by Exim Bank and the value of all export financial support
to agriculture?

Reply: Exim Bank of India extends term loans and working capital loans to the units processing
agricultural products. Pre-shipment / post-shipment financing is also provided to such units for
their export activities. In the year 2014-15, Exim Bank supported export of agricultural products,
and the value of such support amounted to ` 13.53 bn, a share of 1.9% in total loan portfolio as
on March 1, 2015.

Question 17: Can India also advise whether the 360 day credit duration limit noted in the report,
also applies to agricultural goods?

Reply: Yes.

3.3.5.2 Patents
Page 85-86, Paragraph 3.213

While the number of patent applications has been steadily increasing, the number of patents
granted has decreased by one-third (Table 3.22). This may indicate that the backlog of patent
applications is growing.

Question 18: We note that India has recently joined the WIPO case. Many IP offices including IP
Australia have had success using work-sharing tools with other IP offices to increase timeliness
and reduce backlogs without compromising patent quality. Has India considered greater use of
work-sharing to address this backlog?

Reply: WIPO CASE as well as DAS has not yet been deployed in Indian Patent Office since the up
gradation of Data Centre of Indian Patent Office, which is a key requirement for deploying the new
modules, is still under process.

India is not part of any work sharing arrangement because examination of a patent application
needs to be carried out by the Indian Intellectual Property Office to enable complete compliance
with the Patent Act and Rules. However, Section 8 of the Patent Act requires the applicants to
provide information on the status of the applications and its prosecution in other jurisdictions. This
also assists the Indian patent examiners by providing the material information required to evaluate
the application.

The backlog is being addressed through the implementation of the Plan Scheme "Modernization
and Strengthening the Intellectual Property Office" under which 252 posts of examiners and 76
supervisory offices have been created recently. Besides this as a special measure 263 contract
examiners are also to be recruited for a fixed period with a view to reduce pendency.

Page 87, Paragraph 3.219

We note that India has implemented a special compulsory license regime for exports.

Question 19: Could India provide more information on its anti-diversionary measures and
safeguards to protect the interests of patent holders and ensure that the goods produced under
the system reach the intended market and are not re-exported?

Reply: Section 92 A of the Indian Patent Act prescribes clearly that the Compulsory licence for
export of patented pharmaceutical products shall be available for manufacture and export of such
products to any country having insufficient or no manufacturing capacity in the pharmaceutical
sector for the concerned production to address public health problems, only when the country
under reference has already granted a compulsory licence or has, by notification or otherwise
allowed importation of the patented pharmaceutical products from India.