US refuses to discuss aluminium and steel tariffs with India under “Safeguards Agreement”

With the US refusing to roll back its imported aluminium and steel tariffs from India, the latter dragged the matter to the World Trade Organisation (WTO) on April 17, 2018, requesting to consult with the United States over the tariffs and compensation for losses.

Like China and European Union, India claimed the tariffs the “safeguards measures” under the WTO rules and asked for compensation for the losses, accordingly.

But as per the current report on April 19, 2018, the United States has declined India’s request for consultation, stating that its tariffs on Indian aluminium and steel are not any safeguard measures.

In its submission to the WTO on Thursday, the US said that the country, however, would have discussed the matter with India, provided the latter did not claim the tariffs the safeguard measures, a Geneva-based trade official told a reporter. The US also added that while India’s request for consultations under the “Safeguards Agreement” was not valid, they could discuss the issue outside the ambit of the agreement.

“The US notes that the premise for India's request for consultations under Article 12.3 of the Agreement on Safeguards is that the steel and aluminium proclamations are safeguard measures…..The President issued the Steel and Aluminium Proclamations under the Trade Expansion Act of 1962, under which he determined that tariffs are necessary to adjust imports of steel and aluminium articles that threaten to impair the national security of the United States. These actions are not safeguard measures, and therefore, there is no basis to conduct consultations under the Agreement on Safeguards with respect to these measures,” the submission stated.

However, India will get another chance to state its case. The country’s primary argument is it cannot be a security threat to the US as it has always been its security partner taking necessary steps to reduce the trade imbalance between the two countries.