From rxpgnews.com
EU takes wine duty dispute with India to WTO
By Indo Asian News Service,
Nov 21, 2006 - 3:52:42 AM
New Delhi, Nov 20 (IANS) The European Union Monday formally initiated the process to take its dispute with India over the wine and spirits duty regime to the World Trade Organisation (WTO), even as New Delhi said attempts to resolve the issue amicably will continue.
'The European Commission will today request formal consultations with India in the WTO (under the Dispute Settlement Understating) regarding India's import regime for spirits and wines,' an official statement issued by Europen Union said Monday.
'This decision follows an investigation carried out in the framework of the European Union's Trade Barriers Regulation (TBR),' it added.
India's Commerce and Industry Minister Kamal Nath said: 'India is likely to hold another round of discussion with the EU to resolve the ongoing trade dispute over the 'wine and spirits' duty regime.'
'If they want to go to the dispute tribunal, they have the right to do so but we have also taken a specific stand,' he told reporters here.
In a bid to resolve the dispute, Kamal Nath had last week held discussions with EU Trade Commissioner Peter Mandelson here. The talks, however, apparently failed to yield any result.
EU wine and spirits producers have for years raised concerns about the excessive duty burden on imports of spirits and wines into India. The key issue at stake is additional duties levied by India on imported spirits and wines.
'We will always respect genuine sensitivities in India's development but this is out and out protectionism which even the Indian Government has not been able to justify in the past,' the European Commission spokesman for trade, Peter Power, said in Brussels Monday.
'That is why there must be change and why we have no alternative but to pursue the matter in this way,' he added.
The EU has maintained that the Indian authorities have levied additional duties on top of basic customs duties raising the cumulative duty burden to between 177 and 540 percent depending on the import price of the products.
Another issue relates to restrictions on the sale of imported spirits and wines in the state of Tamil Nadu, where only Indian made spirits and wines are allowed to be sold.
An EU TBR Investigation has concluded that access to the potentially large Indian market for wines and spirits is severely restricted due to a high duty burden and restrictions on retail distribution in certain Indian states. The EU has termed these trade barriers as a clear breach of international trade rules.
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