India drags Turkey to WTO against import barriers on cotton yarn

New Delhi: India, on 13 February filed consultations request with Turkey in the World Trade Organisation (WTO), under the dispute settlement system concerning the latter’s safeguard measures on import of cotton yarn, other than sewing thread. India has accused Turkey of randomly extended safeguard, or additional, import duties of 12%-17% on cotton yarn, making Indian textiles uncompetitive in their sixth largest export market.

The request for consultations formally initiates a dispute in the WTO. After 60 days, if consultations have failed to resolve the dispute, then India can request adjudication by a panel.

Turkey had imposed a safeguard duty on cotton yarn imports in July 2008. This resulted in import levies rising from 13%-20% from 5%, which was the bound import duty rate or its commitment to WTO. Under the WTO norms, a safeguard duty could be imposed only for three years. Turkey has already waived of such duties on Egyptian cotton yarn in 2011.

With the three-year term ending in August, Turkey decided to review the process of its extension, but at the same time also imposed provisional duties of 12% to 17% for up to 200 days.

This is the second time that India is fighting a dispute with Turkey in WTO. On 21 March 1996, India had filed a dispute against Turkey’s imposition of quantitative restrictions on imports of a broad range of textile and clothing products. In 2000, Turkey agreed to implement the WTO recommendations and rulings. Turkey was also asked to refrain from making more restrictive restrictions affecting imports of specified textile and clothing products from India, to increase the size of the quotas of India on certain specified textile and clothing products and to treat India no less favourably than any other Member with respect to the elimination of or modification of quantitative restrictions affecting any product covered by the agreement.

Source: Frontier India News Network