India's Response to US Tariff Hikes at the WTO

India has announced its intention to implement retaliatory duties on select US products. This decision is in response to the US's 25% tariff hikes on automobiles and specific auto parts.

Background

• These tariff hikes by the US were adopted as a “safeguard measure” from May 3, targeting imports of passenger vehicles, light trucks, and certain automobile parts.
• India claims that these measures have not been notified by the US and are inconsistent with global trade rules.

Impact on Trade

• The US measures will reportedly affect $2.895 billion worth of Indian-origin auto product imports annually.
• The duties imposed as a result of these measures total $723.75 million.

India's Planned Actions

• India intends to suspend trade concessions of an equivalent value, aiming to levy retaliatory duties on select US products.
• India has notified the World Trade Organisation (WTO) about this plan and reserves the right to suspend concessions after 30 days from the notification date.

Recent Developments

• Last month, India submitted a formal notification under the Agreement on Safeguards to the WTO.
• This notification informed the multilateral trade body about India's intention to suspend concessions in response to US tariffs on steel, aluminum, and their derivative products.