World Trade Organization Organisation Mondiale du Commerce Organización Mundial del Comercio

III. TRADE POLICIES BY SELECTED SECTORS

Services

Brazil 25:

According to document WT/TPR/S/249, p. 161, §130, "[…] All service providers, except providers of value added services (e.g. internet, voice mail, and e mail services), are subject to a universal service levy of 5% of the adjusted gross revenue. Funds from the USOF are allocated to "eligible operators" from the public and the private sectors, through a bidding process, for telecom and broadband infrastructure development projects in rural areas […]"

  Could India provide further detail on the bidding process and on the criteria of selection of the Universal Service Provider?

Reply: The "eligible operators" means the basic service operators, cellular mobile service providers and unified access services licencees, infrastructure providers and internet service providers or any other entities as may be specified in this behalf by the Central Government from time to time. All the details about USOF activities are given on www.uso.gov.in.

Brazil 26:

According to document WT/TPR/S/249, pages 162 163, § 136. "[…] The Draft Policy [for the Maritime Sector] was thereafter reshaped into the India Maritime Agenda 2010 20 issued by the Ministry of Shipping in 2011. […]"

  Could India provide further details on the 'necessary policy interventions' to increase Indian tonnage in maritime transport, mentioned in Chapter 20 (item VI – Shipping Policy) of the Maritime Agenda? Will these policies include restrictions to foreign flag vessels?

Reply: Details of the policy initiatives in the proposed Shipping Policy for the 12^th Five Year Plan for augmenting Indian tonnage are available at the website http://shipping.nic.in .

  Could India provide further details on the proposed shipbuilding subsidy scheme? How will the government assess the necessary subsidy values to establish a level playing field for the Indian shipbuilding industry?

Reply: The new shipbuilding subsidy scheme is under consideration of the Government of India. Inter ministerial consultations are being held and details of the proposed schemes are yet to be finalised.

Brazil 27:

According to document WT/TPR/S/249, p. 163, § 137. "[…] The [Shipping Trade Practices] Bill, if enacted, would regulate the provision of maritime transport services. Providers would be required to register with the Directorate General of Shipping (DGS) and notify their tariffs."

  Could India provide further details on the new obligations to foreign flag vessels concerning the maritime transport of Indian export and import cargo?

Reply: For the purpose of this Act, the shipping service providers are required to register as per Section 5 of the Act, the other sections of the Act are applicable in toto thereafter. This implies that there is no discrimination between a foreign service provider and Indian service provider as far as obligation under the Act is concerned. The entry for foreign ship companies or foreign maritime agencies is regulated as per the national laws. FDI in this sector is 100%. The foreign shipping service providers in India are obligated to register as per section 5 of the proposed Shipping Trade Practices Bill.

Brazil 28:

With regard to paragraph 254, page 114, of document WT/TPR/S/249, India states that the average period for the concession of a patent is between 10 to 60 months. Is this period counted from the filing date or from the publication date? Does the Indian Patent Office implements a first action with regard to patent filings? How is it done?

Reply: This period is counted from the date of filing. The first action is the issuance of the examination report which contains formality objections and technical objections.

Brazil 29:

Regarding the reform of the Indian Patent Law, please explain the benefits and challenges of the use of exceptions and limitations to the patent rights.

Reply: Exceptions and limitations as introduced in the Patents Act are to ensure that monopoly rights are not abused and these have been introduced in public interest. These provisions of law have not been used so far, but the same may be used as and when the situation so warrants.

Brazil 30:

Regarding the use of the Traditional Knowledge Library, please explain the main challenges encountered in other countries in order to avoid the misappropriation of the traditional knowledge created in India.

Reply: Traditional Knowledge Digital Library has been shared with large number of prominent intellectual property offices in the world through an access agreement. The resource is in the International Patent Classification format and can be easily accessed and used for conducting prior art search by the patent examiners. Considering that it is a fairly new database, there could be practical problems faced by patent examiners who are unaware of the Indian traditional knowledge. In order to facilitate access, the TKDL unit of CSIR also provides training as and when requested by patent offices. Such a training was provided to the U.S. patent examiners last year.

Brazil 31:

With regard to competition policy, please provide information of its interface with Intellectual Property Rights. Has any case of restriction of IPR in mergers and acquisitions ever occurred?

Reply: The rights which are conferred under various IPR Acts are exempted under the anti competitive agreements under Section 3 of the Competition Act. As on date no issue on restriction of IPR is mergers and acquisition has arisen.

Canada

Canada 1:

Report by India (WT/TPR/G/249): Part VI. Regional and Bilateral Arrangements: paragraph 79, page 23:

Paragraph 79 of India's Report indicates that "India has concluded 10 free trade agreements, 5 limited scope preferential trade agreements and is in the process of negotiating/expanding 17 more agreements". The Report then lists a number of agreements and negotiations, notably with Japan, Canada, Australia and New Zealand, and the European Union, covering areas such as economic cooperation, trade in goods, services and investments.

1. 
   The recent Japan India Comprehensive Economic Partnership Agreement, unlike previous Indian free trade agreements, includes a number of key commitments relating to the environment and sustainable development. Can India please inform as to whether it has the intention to extend the scope of its current free trade agreement model to include environment and sustainable development provisions, and if so, what kind of provisions does it envision including?
   

Reply: India does not intend to extend the scope of its RTAs to include environment and sustainable development provisions.

Canada 2:

Report by the Secretariat (WT/TPR/S/249): 1Part II. Trade Policy Regime: Framework and Objectives: (3) Trade Agreements and Arrangements; (i) World Trade Organization: paragraph 17, page 26:

Paragraph 17 of the Secretariat's Report notes that India's notifications to the WTO are lagging behind in certain areas.

2. 
   Given the lack of coverage and detail provided in India's notifications to the WTO Committee on Subsidies and Countervailing Measures relative to other WTO Members, when does India expect to provide a complete and accurate subsidy notification to the WTO?
   

Reply: India is taking steps to notify such schemes which are in the nature of subsidies.

Canada 3:

Report by the Secretariat (WT/TPR/S/249): Part II. Trade Policy Regime: Framework and Objectives: (4) Investment Regimes (i) Business Environment; (b) Industrial licensing and zoning: paragraph 30, page 30:

The Secretariat's Report indicates that, "the establishment of an industry remains subject to zoning, to land use regulations at the state level, and to environmental regulations at the central level". The Report also mentions that "Prior environmental clearance is required for all domestic or foreign companies planning a project in an area listed in the Schedule to the 2006 Environmental Impact Assessment (EIA) Notification".

3. 
   Can India please explain the domestic process for conducting environmental impact assessments of domestic and foreign companies' projects?
   

Reply: The environmental appraisal of developmental projects is undertaken as per the provisions of the Environmental Impact Assessment (EIA) Notification, 2006. This Notification provides for screening, scoping for terms of reference (TOR), public consultation and final appraisal for consideration of the environmental clearance. The Notification is applicable uniformly to the developmental projects and activities of the Central Government, state Government, private entrepreneurs, joint venture companies as well as foreign companies.

As a first step, the project proponents have to apply in the prescribed format for seeking terms of reference for preparation of the EIA Reports and Environmental Management Plans (EMPs). The EIA Reports are required to be prepared by accredited Consultants. After preparation of the draft EIA Report, the public hearing is organized by the respective State Pollution Control Boards after following due procedure, as detailed in the EIA Notification, 2006. The issues raised in the public consultation process have to be reflected in the final EIA Report with a detailed clarification on how they are going to be addressed.

After public consultation, final EIA Report is submitted by the project proponent for appraisal. The EIA and EMP Reports are examined by the sector specific expert appraisal committees (EACs) in which the project proponents are given an opportunity to present their case. Based on the recommendations of the EAC, the project is processed in the Ministry for final decision on environmental clearance.

Canada 4:

Report by the Secretariat (WT/TPR/S/249): Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports: (ii) Customs Valuation and clearance: paragraph 25, page 41:

The Secretariat's Report notes that in March 2011, 143 items were subject to a maximum retail price (MRP) based excise duty payment and the abatement ranges from 20% to 40% of the retail price.

4. 
   Could India please provide a list of items pertaining to agriculture and food products and the value of excise duty attributed to each item for the five most recent years?
   

Reply: The list of items and the rate of abatement applicable is as under:

S. No.	Item	Abatement as a percentage of retail sale price
1.	Preparations of other sugars falling under chapter 17 or 21	35
2	Sugar syrups not containing added flavouring or colouring matter; artificial honey, whether or not mixed with natural honey; caramel [1702]	35
3	Gums, whether or not sugar coated (including chewing gum, bubblegum and the like) [1704]	35
4	Chewing gum, jelly confectionary, boiled sweets, toffees, caramels and similar sweets and other sugar confectionery but excluding white chocolate [1704]	30
(cont'd)
5	White chocolate [170490]	35
6	Cocoa powder, whether or not containing added sugar or other sweetening matter [1805 00 00 or 1806 10 00]	30
7	Chocolates in any form, whether or not containing nuts, fruit kernels or fruits, including drinking chocolates [1806]	30
8	Other food preparations containing cocoa [1806]	30
9	All goods, other than Dough for preparation of bakers' ware of heading No. 1905 [1901 20 00 or 1901 90]	30
10	Cornflakes, bulgur wheat but excluding prepared food obtained from unroasted cereal flakes or from mixtures of unroasted cereal flakes and roasted cereal flakes or swelled cereals [1904]	30
11	Prepared foods obtained from unroasted cereal flakes or from mixtures of unroasted cereal flakes and roasted cereal flakes or swelled cereals [1904 20 00]	30
12	Biscuits [1905 31 00 or 1905 90 20]	30
13	Waffles and wafers, coated with chocolate or containing chocolate [1905 32 11 or 1905 32 90]	30
14	All goods, other than wafer biscuits [1905 32 90]	35
15	Wafer biscuits [1905 32 19 or 1905 32 90]	30
16	Extracts, essences and concentrates, of coffee, and preparations with a basis of these extracts, essences or concentrates or with a basis of coffee [210111 or 2101 12 00]	30
17	Yeasts [2102]	30
18	Sharbat [2106 90 11]	25
19	All goods, other than pan masala containing not more than 15% betel nut [2106 90 20]	40
20	Pan masala containing not more than 15% betel nut [2106 90 20]	20
21	Pan masala containing tobacco [2403]	55
22	Betel nut product known as supari [2106 90 30]	30
23	Protein concentrates and textured protein substances, food flavouring material, churna for pan, custard powder, diabetic food [2106 10 00, 2106 90 50, 2106 90 70, 2106 90 80, 2106 90 91, 2106 90 99]	35
24	Mineral waters[2201 or 2202]	45
25	Aerated waters [2201 or 2202]	40
26	Vinegar and substitutes for vinegar obtained from acetic acid[2209]	35
27	Chewing tobacco, preparations containing tobacco, Jarda scented tobacco [2403 99 10, 2403 99 20, 2403 99 30]	55

Canada 5:

Report by the Secretariat (WT/TPR/S/249): Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports: (iv) Tariffs: (a) Applied tariff structure: paragraph 27, page 43:

The Secretariat's Report states that "India's tariff is announced in the annual Budget at the end of February each year; however, additional changes to individual tariff rates may be made during the year by the Ministry of Finance's Central Board of Excise and Customs, through notifications published in the Gazette of India".

5. 
   Can India please provide more information on delays between the notification or publication into the Gazette of India and the actual tariff modification? Could India elaborate as to how it determines which tariffs are subject to additional changes and if the change is an increase or lowering of the tariff rate? Also, could India elaborate on the operation of the Gazette of India, for example when a tariff modification is published in the Gazette of India do interested parties have an opportunity to provide comments and views?
   

Reply: The notifications are published in the Official Gazette of India on the date of issue. Changes in tariff rates normally come into effect on the date of publication of the notification. Where the intention is to give them effect on a subsequent date, a clause is incorporated in the notification to prescribe this. Changes in tariff rates are carried out based on representations received from trade and industry or inputs received from other departments/ministries after taking into account relevant factors such as trends in international prices, domestic prices, demand supply etc of the item. Tariff notifications are legislations issued by the Government in exercise of delegated powers and become part of law from the date of issue. Hence comments and views cannot be given at the time of publication.

Canada 6:

Report by the Secretariat (WT/TPR/S/249): Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports: (v) Other charges affecting imports: paragraph 43, page 50:

The Secretariat's Report states that an Additional Duty and a Special Additional Duty are applied on imports and are aimed at removing or reducing what is considered to be a pro import bias resulting from the application of central excise duties to domestically manufactured goods.

6. 
   Could India please provide more details and information on its process of managing and setting the additional and special additional duties?
   

Reply: Additional duty, also known as CVD, is applied on the goods at the time of import in lieu of the excise duty applicable on domestically produced goods, while special additional duty (SAD or special CVD) is levied in lieu of taxes such as state VAT, sales tax, levied or collected by state government or local taxes/charges. While CVD is levied at rates equal to the excise duty rates applicable to domestically manufactured goods, special CVD is charged at 4% ad valorem. Thus CVD and SAD aim to provide level playing field for the domestic industry vis à vis imported goods.

Canada 7:

Report by the Secretariat (WT/TPR/S/249): Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports: (vi) Import prohibitions, restrictions, and licensing, (a) Import prohibitions: Table III.9, pages 53 54:

The Secretariat's Report includes a table showing the different import prohibitions imposed.

7. 
   Could India please explain the rationale for maintaining import prohibitions on a number of animal, poultry and fish fats?
   

Reply: Import restrictions are imposed if there is a risk of the specific product bringing in one or more specific diseases which could adversely affect the health and safety of the human and animal population.

Canada 8:

Report by the Secretariat (WT/TPR/S/249): Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports: (vi) Import prohibitions, restrictions, and licensing, (c) Import quotas: paragraph 64, page 57:

According to the Secretariat's Report, since the removal of most quantitative restrictions on imports in 2001, a mechanism has been set up to monitor imports of items considered to be sensitive.

8. 
   Could India please provide more details regarding (i) How India classifies a product as being sensitive; (ii) the process used in determining the applied rates for sensitive products and (iii) how sensitive products are either added or removed from the list?
   

Reply: Monitoring of imports of sensitive items is being done on monthly basis. Any item included in the list is need based where it is felt that import of such item should be monitored.

Canada 9:

Report by the Secretariat (WT/TPR/S/249): Part III. Trade Policies and Practices by Measure: (2) Measures Directly Affecting Imports: (vii) State trading: paragraph 68, page 58:

According to the Secretariat's Report, India maintains state trading for certain agricultural goods (i.e. some cereals, copra, and coconut oil).

9. 
   Could India please provide more information on its policies and practices for both national and sub national bodies governing alcoholic beverages?
   

Reply: Section 12(1) of the Customs Act requires the collection of customs duties as specified under any Indian law on goods imported into India. This requires the collection of both the basic customs duty and the additional customs duty, both of which are specified under the Customs Tariff Act. The additional customs duty is collected at the time of import, which is equivalent to the excise duty applicable on the like product produced in India.

As per the Constitution of India, levy of excise duties on alcoholic liquor manufactured or produced in the State is a State subject which is covered under entry 51 of List II (State list) of the Seventh schedule of the Constitution of India. Therefore, excise duty on alcoholic beverages manufactured or produced in the State is charged as per the rates determined by the State governments. Additional customs duty is not collected on alcoholic beverages at the time of import from outside India. State governments levy fees or taxes on alcoholic beverages, imported from outside India or produced in other States when these enter the State. Such fees or taxes are in lieu of the excise duty payable on like domestic product produced in the State.