NEW DELHI: The US Trade Representative has slammed the government’s draft e-commerce policyand attempts to mandate data localisation, while noting that there is enormous scope for India to reduce import duties, which have gone up in recent years.
In its annual publication, USTR has also suggested that the government should not engage in “unjustified retaliation” by raising import duties on 29 products in response to the Trump administration’s decision to hike levies on steel and aluminum. “The US has urged India to work to address the common problem of excess capacity in the global steel and aluminum sectors, rather than engage in unjustified retaliation, designed to punish American workers and companies. The US will take all necessary action to protect interests in the face of such retaliation,” the latest National Trade Estimate Report said.
After threatening to levy higher tariffs, the government has repeatedly postponed the retaliatory action, hoping that the issue can be sorted out via negotiations.
The USTR report is critical of some of the recent moves on data protection. “An only-in-India data storage requirement will hamper the ability of service suppliers to detect fraud and ensure the security of their networks... These data localisation provisions (in the draft Data Protection Bill) would damage the digital economy without supporting privacy. Additionally, the bill would authorise immense fines and criminal penalties in response to data breaches,” USTR said in the report.
Additionally, it has said the “discriminatory and trade-distortive” aspects of the draft e-commerce policy need to be reviewed, including broad-based data localisation and restriction on cross-border data flows. The criticism comes along with the recently-introduced changes to the marketplace model.
A large part of the section dealing with India in the annual publication that looks at trade and other policies across the globe, is related to India’s import tariff regime. “India’s average Most Favoured Nation (MFN) applied tariff rate of 13.8% remains the highest of any major world economy,” it said, adding that the Narendra Modi government’s Make in India policy has resulted in a higher customs tariffs on labour-intensive and electronic goods.
It pointed out that India had agreed to maintain average tariffs of 48.5% at WTO, while the actual applied rate was much lower. “Given this large disparity between WTO bound and applied rates, India has considerable flexibility to change tariff rates at any time, creating tremendous uncertainty for US exporters,” it argued.
Apart from recent trade skirmishes involving India’s export promotion schemes and farm subsidies, the US has also pointed to the tariffs applied by the government.
In its annual publication, USTR has also suggested that the government should not engage in “unjustified retaliation” by raising import duties on 29 products in response to the Trump administration’s decision to hike levies on steel and aluminum. “The US has urged India to work to address the common problem of excess capacity in the global steel and aluminum sectors, rather than engage in unjustified retaliation, designed to punish American workers and companies. The US will take all necessary action to protect interests in the face of such retaliation,” the latest National Trade Estimate Report said.
After threatening to levy higher tariffs, the government has repeatedly postponed the retaliatory action, hoping that the issue can be sorted out via negotiations.
The USTR report is critical of some of the recent moves on data protection. “An only-in-India data storage requirement will hamper the ability of service suppliers to detect fraud and ensure the security of their networks... These data localisation provisions (in the draft Data Protection Bill) would damage the digital economy without supporting privacy. Additionally, the bill would authorise immense fines and criminal penalties in response to data breaches,” USTR said in the report.
Additionally, it has said the “discriminatory and trade-distortive” aspects of the draft e-commerce policy need to be reviewed, including broad-based data localisation and restriction on cross-border data flows. The criticism comes along with the recently-introduced changes to the marketplace model.
A large part of the section dealing with India in the annual publication that looks at trade and other policies across the globe, is related to India’s import tariff regime. “India’s average Most Favoured Nation (MFN) applied tariff rate of 13.8% remains the highest of any major world economy,” it said, adding that the Narendra Modi government’s Make in India policy has resulted in a higher customs tariffs on labour-intensive and electronic goods.
It pointed out that India had agreed to maintain average tariffs of 48.5% at WTO, while the actual applied rate was much lower. “Given this large disparity between WTO bound and applied rates, India has considerable flexibility to change tariff rates at any time, creating tremendous uncertainty for US exporters,” it argued.
Apart from recent trade skirmishes involving India’s export promotion schemes and farm subsidies, the US has also pointed to the tariffs applied by the government.
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