A coalition of seven trade associations outlines concerns regarding India's mounting tariffs on information communications technology (ICT) products and services.
A coalition of seven trade associations including the Telecommunications Industry Association (TIA), Information Technology Industry Council (ITI), Semiconductor Industry Association (SIA), National Association of Manufacturers (NAM), Coalition of Services Industries (CSI), the US-India Strategic Partnership Forum (USISPF), and US-India Business Council (USIBC) has sent a letter to United States Trade Representative Katherine Tai outlining concerns regarding India’s mounting tariffs on information communications technology (ICT) products and services.
According to the letter, since 2014, India has repeatedly increased import duties on certain ICT products in contravention of its commitments to provide duty-free treatment for many of these products under the Information Technology Agreement (ITA). For example, India now imposes duties of 20% on telecommunications products such as switches and base stations, a 20% tariff on mobile phones, a 10% tariff on certain parts for telecommunications equipment, and a 7.5% tariff on parts and accessories of test equipment. On February 1, India’s Minister of Finance proposed further increasing tariffs on printed circuit board (PCB) assemblies, camera modules, connectors, and other ICT inputs. These tariffs have been approved by India’s Parliament and are scheduled to be implemented on the first of April. The continuous and unpredictable implication of these tariffs has significantly decreased business certainty and inhibited the ability of U.S. companies to plan their business operations in India and throughout their supply chains connected to India.
“These most recent tariffs are indicative of a broader effort by the Indian government to pressure companies to localize more of their supply chain in India without regard for the country’s WTO commitments,” the letter says. “We are concerned that, if left unchallenged, this trend will undermine the integrity of tariff bindings made at the WTO by all of its participants as countries seek new tools to force local production of goods, to the detriment of U.S. companies operating in and exporting to India and around the world.”
The coalition urges the administration to make enforcement of India’s WTO commitments a priority in future bilateral engagements and continue to provide support behind the ongoing dispute settlement cases brought by Japan, the EU, and Taiwan at the WTO, including through a renewed assessment of whether the U.S. government should initiate proceedings of its own.