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US challenges Indian export subsidies at WTO

US challenges Indian export subsidies at WTO

US challenges Indian export subsidies at WTO
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By CNBCTV18.COMMar 16, 2018 9:52:00 AM IST (Updated)

The programmes challenged are merchandise exports, export-oriented units (EoUs) scheme, SEZ scheme, the electronic hardware technology parks scheme, EPCG scheme and duty-free imports scheme.

The US has mounted a challenge against Indian export subsidies at the World Trade Organisation (WTO), saying they harm US companies by allowing Indian companies to sell their goods cheaply.

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“These export subsidy programs harm American workers by creating an uneven playing field on which they must compete," USTR spokesperson Robert Lighthizer said. He said the USTR will continue to hold their trading partners accountable and enforce US rights to ensure fair and reciprocal trade.

India helps its exporters of electronics and steel, among others, by exempting them from duties and taxes. India's exports from Special Economic Zones, units created to promote trade, alone have increased by 6000 percent between 2000 and 2017. Exports from export-oriented units and electronic hardware units have increased by 160 percent in that past 16 years, with over 8000 products added to the export list.

India crossed its expiry date for exemption in exports subsidies and food security, among others, according to Commerce Minister Suresh Prabhu.

But Prabhu had defended India's exports subsidies at a WTO meet in Morocco in October 2017, saying the country should continue to receive exemption benefits because it still needs to support a full-fledged economic growth.

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