U.S. Welcomes WTO Ruling Against Indian Export Incentives
A gantry crane unloads a container from a ship to a truck at Krishnapatnam Port in Krishnapatnam, Andhra Pradesh, India. (Photographer: Dhiraj Singh/Bloomberg)  

U.S. Welcomes WTO Ruling Against Indian Export Incentives

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The U.S. has welcomed the ruling of the World Trade Organization's dispute settlement panel which held that India's domestic export incentive schemes were inconsistent with global trade norms, describing it as a "resounding victory" for America's quest for a "level playing field" for its workers.

India on Thursday lost a case filed by the U.S. at the WTO against domestic export incentives as the dispute settlement panel concluded that these schemes are inconsistent with the international trade norms.

Reacting to the ruling, Trade Representative Robert Lighthizer on Thursday said under the leadership of President Donald Trump, the U.S. is "using every available tool, including the WTO enforcement actions, to ensure American workers are able to compete on a level playing field."

"This is a resounding victory for the United States," he said in a statement.

In New Delhi, an official said that India will appeal against the ruling of WTO's dispute settlement panel.

President Trump has previously said that India's "very high" tariffs on U.S. goods are "unacceptable" and must be withdrawn.

Trump, championing his 'America First' policy has been a vocal critic of India for levying "tremendously high" duties on U.S. products, has described the country as a "tariff king".

The WTO ruling has stated that India should not provide subsidies based on export performance.

The dispute panel ruled that India's export incentive schemes such as Merchandise Export from India Scheme, Export Oriented Units, Electronics Hardware Technology Parks Scheme; special economic zone; and Export Promotion Capital Goods Scheme were inconsistent with global trade norms.

The panel has stated that India will not get an eight-year period like other developing countries for phasing out these schemes.

With this ruling, India has to re-work these schemes and make them compatible with global trade rules, being framed by 164-member Geneva-based WTO.

According to trade experts, the ruling would impact India's exports and the government will have to immediately work on alternatives.

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