STATE TRADING

additional replies[1] to Questions from the United States[2]
regarding India's new and full notifications[3]

The following communication, dated 20 December 2024 and received on 21 December 2024, is being circulated at the request of the delegation of India.

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Question 1

The United States notes that India's Foreign Trade Policy (FTP) for 2015-2020 (https://dgft.gov.in/sites/default/files/ft17-051217.pdf and specifically, APPENDIX‑2J https://dgft.gov.in/sites/default/files/2J.pdf), lists the following agricultural entities as state trading enterprises (STEs) for FTP purposes:

·_      Food Corporation of India (FCI);

·_      State Trading Corporation (STC);

·_      Indian Oil Corporation (IOC);

·_      Bharat Petroleum Corporation Ltd. (BPCL);

·_      Hindustan Petroleum Corporation Ltd. (HPCL);

·_      Oil and Natural Gas Corporation Ltd. (ONGC);

·_      Minerals and Metals Trading Corporation (MMTC);

·_      Indian Potash Ltd. (IPL);

·_      National Dairy Development Board (NDDB);

·_      National Cooperative Dairy Federation (NCDF);

·_      National Agricultural Cooperative Marketing Federation of India Ltd. (NAFED);

·_      Projects and Equipment Corporation of India Ltd (PEC);

·_      Spices Trading Corporation Limited (STCL); and

·_      Central Warehousing Corporation (CWC).

In the 2018 notification, India removed the NDDB as a STE. No explanation was provided by India for this removal. Please explain why India continues to maintain that the NDDB is a STE in the FTP, but removed it for notification purposes.

Question 2

As mentioned above, India has identified ONGC, NCDF, and PEC as STEs in the FTP. However, none of these STEs were notified for the period 2015-2018. Please explain why India maintains that these entities are STEs in the FTP, but did not notify them as part of its recent biennial notifications.

Replies to Questions 1 and 2:

These entities are not STEs during the concerned period within the meaning of Article XVII of GATT and within the working definition of STE as set out in the Understanding on the Interpretation of Article XVII of GATT 1994. Therefore, there is no need to notify these entities under Article XVII of GATT 1994.

Question 6

The United States notes that India's MA:1 notification to the WTO Committee on Agriculture (_G/AG/N/IND/6 (dated 7 March 2011)) stated that the DGFT allocates tariff rate quotas (TRQs) among eligible entities with import licenses for the following commodities:

·_      NDDB, STC, NCDF, NAFED, MMTC, PEC and STCL for milk and cream in powder (HS codes: 0402.10 and 0402.21);

·_      NAFED, STC, MMTC, PEC, STCL and State Cooperative Marketing Federations (SCMF) for maize (corn), other (HS code: 1005.90);

·_      NDDB, STC, NAFED, STCL and Central Warehousing Corporation (CWC) for sunflower‑seed oil or safflower oil and fractions thereof, crude oil 1512.11); and

·_      NDDB, STC, NAFED, STCL and CWC for rape, colza or mustard oil and fractions thereof, other (HS code: 1514.90).

Please explain why NDDB, STC, NCDF, NAFED, MMTC, PEC, STCL, SCMF and CWC were not notified as having special privileges on the importation of the above-mentioned agricultural products under the respective TRQ.

Reply:

These entities are not STEs during the concerned period within the meaning of Article XVII of GATT and within the working definition of STE as set out in the Understanding on the Interpretation of Article XVII of GATT 1994. Therefore, there was no need to notify these entities under Article XVII of GATT 1994 in _G/STR/N/15/IND (dated 8 November 2018) and _G/STR/N/16/IND - _G/STR/N/17/IND (dated 3 October 2019).

Question 7

The United States understands that from 2012 – 2017, MMTC, PEC, and STC exported approximately 6 million metric tonnes of wheat and rice from FCI stocks on behalf of the Government of India. Please explain why these STEs have not been notified in the 2018 and 2019 Notifications as having a special export privilege for these agricultural products.

Reply:

MMTC, PEC and STC do not enjoy any special export privileges for wheat and rice during notification period. Therefore, there was no need to notify them under Article XVII of GATT 1994 and its Understanding.

Question 8

For all of the above, if India mistakenly did not notify the applicable STE, please clarify when India will provide an updated notification to the Working Party.

Reply:

This issue relates to Questions 1, 2, 6 & 7, which have been answered above.

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