India-US successfully resolve all seven pending WTO disputes bilaterally

India and the United States (US) have informed the World Trade Organization (WTO) that both countries have been able to arrive at a mutually agreed solution regarding the dispute over poultry imports from Washington.

With the submission of this notification to the WTO’s dispute settlement body, the two countries have now resolved all 7 of their pending trade disputes at the global trade body.

The resolution of all the disputes is not only a sign of strengthening economic ties between both nations, but also showcases India’s new approach to trade issues. Besides, the US is also India’s largest trading partner. Goods trade between the two countries increased to $128.8 billion in 2022-23, from $119.5 billion in the previous financial year.

The US had moved the WTO against India in the poultry case in 2012. The WTO had then ruled that India’s ban on poultry imports–mainly chicken legs–from the US was inconsistent with the global trade norms. The US demanded compensation because India was not able to implement the decision in time.

The announcement of the settlement of the case was made in September, after the bilateral meeting between Prime Minister Narendra Modi and US President Joe Biden on the sidelines of the G20 summit.

As part of the settlement, India agreed to cut import duty to 5-10 per cent on some fresh and processed food items, such as fresh, frozen, dried and preserved cranberries and blueberries, as well as frozen turkey. The duty cut came into effect last month.

HOW IT BEGAN

The discussions on bilateral settlement of pending WTO disputes between both sides began during the annual Trade Policy Forum (TPF) meeting between both countries in January 2023. The TPF aims to resolve trade and investment issues between both nations.

Commerce and industry minister Piyush Goyal had then said that since these outstanding disputes were areas where both countries have had some wins and some losses, both countries have directed their officials to engage ‘aggressively’ on the matter. “Over the next two or three months we will see if we can find a bilateral settlement of some of these WTO disputes,” Goyal had said.

Thereafter, in June last year, both sides decided to close half-a-dozen outstanding disputes at the WTO including the retaliatory tariffs India imposed on imports of some farm products from the US. The announcement was made after Modi’s meeting with Biden in Washington.

The six disputes included India’s appeal against the US's imposition of tariffs on imports of steel and aluminium products from India; the US appeal against India’s retaliatory tariffs; India’s renewable energy subsidies for solar cells and modules under Jawaharlal Nehru National Solar Mission; India’s appeal over similar subsidies for solar cells and solar modules by eight US state governments; the US appeal against India’s export subsidy programmes; India's imposition of countervailing duties on imports of certain hot-rolled carbon steel flat products from the US.