Ecommerce tariffs: India open to a longer extension of the moratorium

This will give businesses greater predictability, says Goyal

India has signalled a softening of stance at the recently concluded 14th Ministerial Conference (MC14) of the World Trade Organization (WTO), indicating openness to a “longer” extension of the moratorium on ecommerce tariffs to provide more predictability for businesses.

 

Most developed countries, including the United States (US), want the moratorium to be made permanent. The US has been pushing strongly to make the ecommerce duty moratorium permanent, while India is willing to accept only a temporary extension. 

On Thursday, however, Commerce and Industry Minister Piyush Goyal said: “India’s stand (at the MC14) was that we should look at a little longer period so that businesses can plan their activities for a longer period.” 

 

“We discussed this among the ministers, and we were of the opinion that, to bring more certainty and predictability to businesses, we must consider a longer term this time. This is still under discussion among various countries and will be finalised over the next month or two,” Goyal told reporters in a briefing. 

The 14th MC took place in Yaoundé, capital of Cameroon, from March 26 to 30, but ended without any ministerial declaration as countries “ran out of time”, failing to reach consensus on key issues, including the contentious moratorium on ecommerce tariffs. Talks on the moratorium, among other issues, will continue in Geneva, where the WTO is headquartered, and will be announced as part of the Yaoundé package.

 

Under the WTO moratorium, countries do not impose Customs duties on cross-border electronic transmissions. For nearly three decades, member nations have agreed to extend the moratorium every two years, though they remain divided over whether it should continue.

 

India continued to resist a long-term moratorium, citing concerns over revenue loss.

 

Last week, US Trade Representative (USTR) Jamieson Greer had said: “I want to be clear: The US is not interested in another temporary extension of the moratorium. It would not provide our businesses the certainty needed for their operations. It would also further weaken the WTO’s standing.”

 

Earlier this week, Greer said the US would work outside of the WTO with all interested trade partners on this issue and commit to a plurilateral ecommerce moratorium agreement.

 

Amid pressure from some developed countries to bring plurilateral agreements as part of the WTO reform discussions, Goyal said such arrangements should operate with some “guardrails”.

 

“As I mentioned earlier, we have brought the plurilateral (agreements) into the WTO reform package so that if at all they have to be considered in the future, there should be some guardrails and it should not be completely left to the choice of the components of any agreement,” Goyal said.