US, EU Criticise India's Tariffs and Non-Tariff Trade Barriers
The United States (US) and the European Union (EU), India’s top two trading partners, have pointed out various regulatory and non-tariff obstacles that they argue are negating the advantages of India’s attempts to liberalize its economy and connect with global supply chains.
Concerns expressed during the discussions on India's eighth trade policy review at the World Trade Organization (WTO) encompass high tariffs, sanitary and phytosanitary (SPS) measures for safeguarding human, animal, and plant health, technical barriers to trade (TBTs), quality-control regulations, limitations on services and digital trade, local-content mandates, and obstacles to government procurement.
The WTO’s trade policy review (TPR) serves as a peer assessment of a nation's trade policies. The WTO Secretariat and the nation being evaluated compile distinct comprehensive reports on its trade policies and priorities.
Other WTO members review the reports and pose written inquiries, requesting clarifications on particular tariffs, regulations, and various trade obstacles.
During the review meeting, participants bring up these concerns, and the country addresses them, explaining its policies. India experiences a TPR every five years.
The US stated in its remarks, included in the latest WTO review minutes, that although the Indian government's efforts towards trade agreements promoting transparency and sound regulatory practices are commendable, India needs to take further actions to substantially lower tariffs, eliminate unwarranted SPS and TBT measures, avoid creating hindrances to services and digital trade, and retract regulations that disadvantage foreign exporters and investors.
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The European Union expressed worries about what it called inconsistent customs processes, complex SPS regulations, deficiencies in safeguarding intellectual property rights and geographical indications, and restricted opportunities for government procurement.
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The EU highlighted India's increasing adoption of Quality Control Orders (QCOs), noting that these impose cumbersome conformity-assessment demands based on local standards that differ from globally accepted benchmarks.
This poses a growing threat of isolating the Indian market from the global economy and undoing the economic advancements observed in recent years.
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The EU, nonetheless, recognized that India has started to tackle the problem. It indicated that a reform initiative had begun after a report from NITI Aayog’s High-Level Committee on QCOs and that complete execution of its suggestions could resolve numerous issues.