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India blocked a World Trade Organization
investigation of its import duties on American wine
and spirits Monday, temporarily delaying a U.S. government
complaint over allegations that Indian rules discriminate
against products such as Napa Valley wine and Jack Daniel's
whiskey.
The trade panel is already reviewing a
European legal challenge of wine and liquor restrictions
in a number of Indian states. A second investigative
panel examining Washington's arguments will almost certainly
be established at a meeting later this month of the
WTO's dispute settlement body.
India's basic import duties on wine are
100%, while the tariff on spirits is 150%, both within
WTO limits. However, various government surcharges take
the tariffs up to levels reaching as high as 550%, depending
on the Indian state.
The state of Tamil Nadu goes further still,
shutting out foreign alcohol and allowing shops to sell
only Indian-made spirits and wines.
The United States, the European Union
and Japan, by contrast, allow nearly all spirits to
enter their markets duty-free. China tacks on a 10%
charge on foreign liquor.
India criticized Washington's decision
Monday to bring the case to the WTO as "very unfortunate
and disappointing." India said it is considering
changing its rules to resolve the dispute, a claim it
also made in criticizing Brussels' move to bring its
case to the WTO.
India is one of the largest markets for alcohol in the
world and has huge potential for growth.
Source: www.usatoday.com
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