Search the Internet          Tips  Sites: Finance, Investment

WTO: India hits out at US zero tariff plan

India has strongly opposed the US proposal submitted to the World Trade Organisation for eliminating tariffs on industrial and consumer goods by 2015, terming it "clearly unfair" and against the interests of the developing countries.

Addressing the World Trade Organisation meeting on market access in Geneva, India's Ambassador K M Chandrasekhar said the call on developing countries to bind their tariffs to zero was "clearly unfair" and did not take into account their developing and budgetary needs.

He was speaking shortly after the US formally presented its proposal to its WTO partners, which aims at gradually eliminating all non-agricultural tariffs by 2015.

He pointed out that tariffs were vital for government revenues, with customs tariffs accounting for between 30 and 40 per cent of overall tax revenue for developing countries, as compared to the US, where it was about one per cent.

Other developing countries including Malaysia, Pakistan and Philippines also highlighted similar concerns, sources said.

However, the US ambassador to the WTO, Linnet Deily, insisted that the proposals were "bold and fair" and poor countries stood to benefit.

Industrial goods make up about 89 per cent of developing countries' exports, she said on the first of the two scheduled days of market access talks, part of the Doha Development round of trade negotiations due to run until the end of 2004.

"Through the US proposal, developing countries would secure within five years duty-free market access for non-agricultural goods now entering developed country markets at tariff levels at or below five per cent," she said.

"This accounts for more than three-quarters of imports to the United States, Europe and Japan," Deily said.

"Developing countries stand to gain significantly, not only through better access to developed country markets, but also from each other," she added.

The US proposal calls for cutting of all duties on manufactured goods worldwide to less than eight per cent by 2010, and then to zero over the next five years.

Duties on goods now set at five per cent or less would be reduced to zero by 2010.

"We are putting our own sensitive areas, textiles, apparel, footwear, glassware, on the table in an unprecedented manner," Deily said.

The US was mindful of concerns raised about the need to maintain revenues, and was ready to talk about special and differential treatment for poorer members to help meet their needs, she said.

Malaysia's representative said the US plan was "highly ambitious" but urged the need to be realistic, adding that to completely surrender revenues was not something it could commit to "for the foreseeable future".

Pakistan's delegate also said though its reliance on revenues from tariffs had decreased from 45 per cent to 11-12 per cent of overall taxes, they still contributed a significant amount.

The US proposal, unveiled last week in Washington, found backing from New Zealand, Uruguay, Singapore and Australia.

ALSO READ:
India and the WTO: News and issues
More Money Headlines