World Trade Organization Organisation Mondiale du Commerce Organización Mundial del Comercio

14 y 16 de septiembre de 2011
EXAMEN DE LAS POLÍTICAS COMERCIALES

INDIA

Acta de la reunión

Addendum

Presidente: Excmo. Sr. Mario Matus (Chile)
En el presente documento figuran las preguntas presentadas anticipadamente por escrito, junto con las respuestas facilitadas por la India.¹

REPLIES PROVIDED BY INDIA

ARGENTINA

WT/TPR/S/249, Report of the WTO Secretariat

II. TRADE POLICY REGIME: FRAMEWORK AND OBJECTIVES

4) Investment Regime

ii) Foreign Investment Regime

Argentina 1:

1. In paragraph 35, the report refers to the legal framework for foreign direct investment, noting that certain FDI is subject to "automatic" approval.

  Which FDI is subject to the automatic route?

  Please indicate the criteria used to determine which FDI is subject to the automatic route.

  Is there any other mechanism in addition to this one to regulate/approve FDI? If so, which and to which FDI does it apply to?

Reply: The extant policy on FDI, including the list of automatic sectors, is covered in Chapter 5 of "Circular 1 of 2011   Consolidated FDI Policy", which is available in the public domain at www.dipp.nic.in. In general, FDI, up to 100%, under the automatic route, is permitted in all sectors, except those specifically indicated as not being eligible for the same under Chapter 5 of the Circular, subject to applicable laws/sectoral rules/regulations/security conditions. The Foreign Investment Promotion Board (FIPB), Ministry of Finance, recommends proposals for investment in the capital of resident entities by non resident entities, covered under the "Government route" (i.e. requiring the prior approval of Government).

Argentina 2:

2. In paragraph 39, the report indicates that the number of sectors and activities in which FDI is prohibited increased during the period under review.

  Why have prohibitions on FDI increased and which sectors does it affect?

Reply: The list of sectors prohibited under both the Foreign Exchange Management Act and FDI Policy as extant at the time of the earlier review, was subsequently consolidated under the FDI policy, vide Press Note 7 (2008), which is available in the public domain at www.dipp.nic.in. Only one additional sector i.e. "manufacturing of cigars, cheroots, cigarillos and cigarettes, of tobacco or of tobacco substitutes" has since been added. This has aligned the policy with Government's earlier decision of not granting industrial licenses for fresh capacity in the sector.

III. TRADE POLICIES AND PRACTICES BY MEASURE

2) Measures directly affecting imports

v) Other charges affecting exports

Argentina 3:

3. In paragraph 42, the report indicates that India imposes an "additional customs duty" and a "special additional customs duty" on imports.

  On which basis are these duties applied?

Reply: The duties and charges as mentioned in the aforementioned paragraphs are in the nature of charges equivalent to internal taxes applied at the border in order to provide level playing field for the domestic industry. Under Article II:2 of the GATT 1994, Members are allowed to impose a charge on the imported products equivalent to internal taxes levied on like domestic products.

  Are these duties specific or ad valorem?

Reply: Additional customs duty is applied on the imported goods in lieu of the excise duty applicable on domestically produced goods, while special additional duty is levied in lieu of taxes such as state VAT, sales tax, levied or collected by state government or local taxes/charges. While additional customs duty is levied at rates equal to the excise duty rates applicable to domestically manufactured goods, special additional duty is charged at 4% ad valorem.

  Which products do they apply on?