Replies of India to Questions raised by EU, US and Japan in

G/MA/W/120 and G/IT/W/42

The following communication, dated 16 November 2016, is being circulated at the request of the delegation of India.

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1.     Could India confirm that the four products mentioned above fall under codes 8517 62 90 or 8517 69 90? If products within the four categories subject to Customs Notification No. 11/2014 are classified under one of these two tariff lines, please specify which products are classified under each tariff line?  If they are not classified under those subheadings, what are the tariff lines under which India classifies the above-listed product categories?

Reply to Question 1

India reiterates its earlier stand that the main issue here is not the classification but the tariff binding commitments.  The goods in question are not covered under our ITA commitments.  India signed the ITA-1 in the year 1997, and presented its schedule of commitment, which was subsequently certified in document WT/Let/181.

In this regard, India explained in the CTG meeting held on 14 July 2016 that IT and telecom technologies have evolved over the years. New technologies, applications and equipment have been developed which were neither existent nor even conceived at the time of signing ITA 1. 

Further, it may be noted that during the time when ITA-1 was negotiated, HS Code 8517 for telecom equipment referred to telecommunication apparatus for "carrier-current line systems & digital line systems".  However, in the last few years, several new technologies have been developed. Subsequently the said code has been expanded to include new technological developments.  Since our ITA-1 obligations are limited to those items that confirm to the 1996 definition of products for "carrier current line systems & digital line systems", new products that have lately been classified under this category cannot be considered as part of ITA 1 agreement.

India is not intending to take any fresh commitment on goods for which India did not sign the ITA 1, and which have subsequently evolved. In fact, it is evident that to take care of new developments in technologies and new products, some Participants have concluded ITA 2. India is not a signatory of ITA 2.

Also, it is reiterated that for each line of India's commitments under ITA, the Schedule clearly mentions its source, which in this case is WT/Let/181. India has not committed what is there beyond our ITA 1 commitment inscribed in WT/Let/181.

2.     Could India confirm that the four above-listed product categories subject to Customs Notification No. 11/2014 are now subject to 10% duty rate?

Reply to Question 2

Yes, all four categories of products listed in Customs Notification No. 11/2014 dated 11 July 2014 are subject to 10% Basic Customs Duty.

3.     What are India's WTO bound tariff commitments for each of the four above-listed product categories subject to Customs Notification No. 11/2014?

4.     How does India justify introducing 10% import duty for products falling under 8517 62 in light of India's commitment pursuant of the ITA and in light of its concessions in the WTO Schedule, recently updated in HS2007 which binds the whole subheading at 0% of duty rate?

5.     Should India consider that the products falling under 8517 62 are not covered by India's commitment pursuant of the ITA, could India clearly present the reasons?

6.     Should India consider that the products falling under 8517 69 are not covered by India's commitment pursuant of the ITA, could India clearly present the reasons?

Replies to Questions 3 to 6

As indicated in reply to Question 1 above, India considers that since 1 March 1997 (when India became a signatory to ITA-1), several new technologies have evolved in the telecom sector to address new functionalities required.  Accordingly, India considers that tariff preference commitments under ITA-1 apply only to the original commitment and not to the new technologies evolved over the years.  Hence, for the new technologies and the products which were not in existence prior to signing ITA-1, India, like any other WTO member, is entitled to impose duty on those specific new products.

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