Wt/tpr/M/313/Add. 1 31 July 2015

Reply: There is no decision yet on the issue.
Article 39.3 relates to the specific case when data pertinent for seeking approval of the authority is shared with the marketing regulator. The text of this Article does not specifically state that member countries would need to comply with the requirement of data exclusivity. It only states that the regulator will need to protect it from unfair commercial use. Therefore, no additional obligations which are not present in text can be interpreted. The obligation on the authorities is to keep the test data secret and not allow it to be accessed by third parties through unfair means. India complies completely with its obligations under Article 39.3 of TRIPS.
Page 97, paras 3.266/3.268- IPR enforcement at border

EU Question 73: The reports note that India's border IP enforcement rules go beyond the minimum requirements of the TRIPS Agreement. The table 3.27 shows that there was only very few IPR infringements registered by Customs given the significant value of India's foreign trade.

Could India provide further insight regarding the relatively low level of infringements registered?

Reply: While border measures for imports exist for Trademarks, patents, Geographical Indications, Designs and Copyrights, there have been no recordals for designs and GIs.

Most cases of infringement relate to Trademark infringements.

Page 99, Para 4.1; Agriculture, 4.1.1 General policy framework
EU Question 74: The EU would welcome further details on India's plans to consolidate and expand its position as an exporter of agricultural products. To what extent would a stable, transparent and standards driven regulatory regime could promote this aim? In what way is India hoping to improve agri-investment and technology in the sector?

Reply: India is constantly investing in agriculture and well-being of its poor farmers. The priority is to improve technology available to the farmers. India has a transparent regulatory regime and we are always making efforts to improve the same.
Page 100 Paragraph 4.12-Measures affecting exports.

The report states that on 12 February 2014 the Indian Government approved a subsidy at the rate of Rs 3,300 per tonne towards marketing and promotion services of raw sugar. The scheme continues during the current sugar season 2014-15 and on top of that, Indian regional Maharashtra government has decided in April to grant an additional export subsidy of Rs1,000 per tonne of raw sugar.

EU Question 75: In the light of the above, could India explain:

a.How it interprets the "implementation period" as referred to in paragraph 9.4 of the Agreement on Agriculture and the end data of it.

b.What are the rules in India governing the granting of export subsidies by the regional authorities? Are regional governments bound by the commitments India has taken in the WTO?

Reply: The Hong Kong Ministerial Declaration makes it clear that developing countries would continue to be exempt from reduction commitments on export subsidies listed in subparagraphs (d) and (e) of paragraph 1 of Article 9 of the Agreement on Agriculture. Therefore, Members which are benefiting from S&D treatment during the implementation period would continue to benefit from such provisions till a new agreement is in place. In the spirit of the on-going reform process under Article 20 of the Agreement on Agriculture, while developed Members continue to provide huge export subsidies, developing countries should not be deprived of S&D treatment during the interim period which is only a fraction of what is being given by the developed countries.

EU Question 76: Can India provide information about the export markets for its sugar surplus? Which amount has been exported since 2010 with subsidized prices?

Reply: South Africa, neighboring countries like Burma, Sri Lanka and Gulf countries like UAE, Iran etc are main export markets of Indian sugar.

Since 2010 no sugar has been exported by India with subsidy. A total of 7.5 lakh MT of raw sugar was exported in 2013-14 sugar season , with incentive that is eventually passed on to the farmers towards their cane dues arrears.

Page 102, Paragraph 4.19- Price Support Scheme

EU Question 77: Can India provide the average selling price for the 4.5 mio t wheat exported in 2012/13 and the 2 mio t exported in 2014/15. Can India provide the average selling price for the 7 mio t wheat sold on internal market in 2012/13 and the 6 mio t sold in 2014/15. Can India indicate total budgetary outlay per budget years 2010 to 2014 for the agencies involved in Price Support Scheme, if possible broken down per agency

Reply: The Food Corporation of India has exported a total quantity of 4.24 million MT of wheat against the 4.5 million MT authorised in 2012-13. It has further exported a total quantity of 1.56 million MT of wheat against the 2.0 million MT authorised in 2013-14. The average realization price has been about $303.

Details of subsidy released are available at the website of the Department of Food and Public Distribution.

Page 105 paragraph 4.30-Energy

EU Question 78: What is India's plan to reduce its energy (oil and gas) import dependence from 77% today to about 67% by 2022, and make it more energy secure? What is the plan/ roadmap to support cleaner fuel (gas) in India?

Reply: As per present trend and expected growth in India it is recognized that 10% reduced dependence on imported crude oil will require substantial increase in domestic production by adopting new state of art technology, conservation measures, adoption of alternative fuels including renewable energy sources. India has adopted multi-pronged strategy to achieve this target. Government of India has taken various measures/initiative to increase domestic share of crude oil and natural gas such as:

• 
  Enhance production from the existing field by adopting Improved Oil Recovery (IOR)/Enhanced Oil Recovery (EOR) measures using induction of latest technology.
  
• 
  Bring into production new discoveries at the earliest. In tune with Government's stated principle of ease of doing businesses, a policy framework for early monetization of hydrocarbon discoveries under PSC regime has been approved by the Government. This policy has addressed rigidities in the timelines of the PSC and has allowed the contractors to start production at the earliest. 34 cases have been already resolved under this policy framework involving resources worth $ 5 billion.
  
• 
  Marginal Field Policy (MFP) has been formulated to monetize the marginal fields of ONGC and OIL which have not been monetized for various reasons in the past. Monetization of these discoveries under this policy through International Competitive Bidding (ICB) would also help in boosting Oil & Gas production of the Country. Lucrative fiscal terms with more autonomy is proposed in the policy for making it investor friendly.
  
• 
  A new Uniform Licensing Policy (ULP) is being formulated which covers all type of hydrocarbons viz. Conventional Oil & Gas, Unconventional Hydrocarbons like Shale Oil & Gas , CBM, Gas Hydrate etc. This would help in development of all type of hydrocarbons under single license.
  
• 
  Revision of prices of domestic natural gas is expected to incentivize production of natural gas in the country. Ministry is also considering to provide premium for gas discoveries in Deep Water, Ultra Deep Water and High Pressure High Temperature (HPHT) discoveries.
  

Regarding the point raised on plan to support clean fuel (gas), it may be noted that highest priority in allocation of natural gas has been given to the transport (CNG) and domestic households (PNG). During August, 2014, Government decided to meet 100% demand of CNG and PNG sector through supply of the cheaper domestic gas. GAIL has also been authorized to supply 10% over and above the allocation to meet any fluctuation in demand. As on 31^st March, 2015, about 3.00 million households and 2.26 million vehicles are benefitting from these clean and conventional fuels. The Ministry of Petroleum and Natural Gas also aims to expand the PNG network across the country, raising the number of households connected with PNG to 10 million within 5 years.

Further, laying of another 15000 km of additional gas pipeline to complete the national grid is being monitored. Out of the proposed 15000 km gas additional pipeline, 11900 km is already authorized and is at various stages of implementation. In order to expedite the work, 2500 km of gas pipelines are being planned on the PPP mode.

Page 106, Paragraph 4.32 – oil and gas

EU Question 79: For exploration and production activities in oil and gas sector, does India plan to move from NELP to Open Acreage Licensing Policy during new bidding rounds?

Reply: A new Uniform Licensing Policy (ULP) is being formulated which covers all type of hydrocarbons viz. Conventional Oil and Gas, Unconventional Hydrocarbons like Shale Oil and Gas, CBM, Gas Hydrate etc. This would help in development of all type of hydrocarbons under single license. The Open Acreage Licensing is being considered. The National Data Depository (NDR) is being set up as it is considered to be a critical requisite for moving to OALP in the country.

Page 108, Paragraph 4.45- electricity

EU Question 80: The Report mentions "The JNNSM further required that in order to avail of the subsidies all solar projects should use cells and modules manufactured in India, and 30% local content was required for plants or installations for a solar thermal project," - Will subsequent phases of JNNSM also require 30% local content requirement? Is this also applicable for State owned solar projects not linked with JNNSM?

Reply: 30% Local Content Requirement was stipulated only in respect of tenders issued for allocation of Solar Thermal Projects. There is no proposal for allocating solar thermal projects as of now. The State Governments have issued their Solar Policy independently, however, none of the State Governments have allocated Solar Power Projects with DCR Content.

The Domestic Content Requirement under Phase II of National Solar Mission has been increased up to 100% for 50% of the total planned capacity. Furthermore, in September 2011, the Ministry of New & Renewable Energy published revised new draft guidelines for installation of wind turbine models in India which stipulate that manufacturers of Wind Turbine Generators of capacities more than 15 MW would have to set up a manufacturing base in India. Additionally, prices per kw paid to developers are very low even under its cost, uncertain and different into the different States.

EU Question 81: Taking into account these constraints, how shall India attract investment from foreign companies in renewable energy? What are the views/plans of the government in this regard?

Reply: Government of India (GOI) has announced revision of targets of National Solar Mission to 100 GW by 2022 which is a long term action plan to attract investment. Also, the DCR Content is miniscule as compared to the total capacity so far added and the future plans thereof. GOI has a policy to support Domestic Manufacturing on one side while encouraging oversees manufacturing units to supply solar products with latest technology at competitive prices. GOI is also extending custom and excise duty exemption on import/supply of plant & machinery required for setting up of solar power projects in the country. Several schemes have also been launched wherein the foreign investors can set up solar power projects in solar parks, developed by GOI.

EU Question 82: Do Indian authorities plan to establish a National Wind Mission to promote this kind of renewable?

Reply: Prospective policy decisions in this regard will be notified on the website http://mnre.gov.in as and when initiated.
EU Question 83: Do Indian authorities have any data about the implementation of this additional solar purchase obligation in 2013 and 2014? Do Indian authorities have or plan a similar obligation for wind energy?

Reply: As per the provisions of the Electricity Act, 2003, one of the functions of the State Electricity Regulatory Commission is to promote the generation of electricity from renewable source of energy, and also to specify a percentage of renewable energy sources out of the total consumption of electricity. Further, with the amendment of the Tariff Policy, 2006 in January, 2011, the State Commissions are required to reserve a minimum of 0.25% for purchase of solar energy by the end of 2012-13 and further go up to 3% by 2022.
The solar installed capacity till date is 3383 MW against renewal purchase obligation requirement of 4813 MW for the year 2014-15. All the State Commissions except Sikkim, have notified the Regulations specifying the Renewable Purchase Obligation for the obligated entities in their State.
Renewal purchase obligation has also been laid down for wind energy as well.
Page111, para 4.58 Services
EU Question 84: Could India explain what are the costs to be borne by foreign commercial banks with respect to the new policy on priority sector lending. Is India's government considering covering part of these costs?

Reply: Priority sector loans are competitive loans and the extant guidelines on priority sector do not lay down any preferential rate of interest for such loans. As such banks do not incur any additional cost for lending to priority sectors as compared to non-priority sector loans.

Page 113 para 4.70 - banking services

EU Question 85: Could India provide further information on how the principle of reciprocity is considered in practice for the purpose of the "Scheme for Setting up Wholly-Owned Subsidiaries by Foreign Banks in India"? What are the criteria for determining reciprocity for the purpose of the Scheme? Have India determined reciprocity of a foreign country for the Scheme already? If so, which one?

Reply: The policy on presence of foreign banks in India has followed two cardinal principles of (i) Reciprocity and (ii) Single Mode of Presence. These principles are independent of the form of presence of foreign banks. Therefore, these principles continue to guide the framework of the future policy on presence of foreign banks in India. In general, foreign banks organized as WOS would enjoy greater freedom in terms of opening of branches.

The factors taken into account while considering applications for setting up WOS in India include, inter alia, the economic and political relations with the country of incorporation of the parent bank and reciprocity with home country of the parent bank.

Page 114 para 4.73 – commercial banks
EU Question 86: Can India provide further information on the application of the Special Economic Zones Act 2005 to International Financial Services Centres, including any market impact analysis in this area.

Reply: International Financial Services Centre (IFSC) has been set up under Section 18(1) of Special Economic Zones Act, 2005.

IRDAI has issued the IRDAI (IFSC) Guidelines, 2015 for establishing an IFSC Insurance Office (IIO). These Guidelines are available at:

https://www.irda.gov.in/ADMINCMS/cms/whatsNew_Layout.aspx?page=PageNo2465&flag=1.
Page 116, Para 4.90 - insurance
EU question 87: Could India explain whether the increase of foreign equity limit applies to all sectors of insurance, i.e. life and non-life insurance, reinsurance, insurance intermediation, services auxiliary to insurance. Is the full lifting of equity caps envisaged as part of India's "investor-friendly" FDI policy?

Reply: The details regarding increase in foreign equity limit for insurance sector is available in the latest Consolidated FDI Policy circular dated 12^th May, 2015.
Page 122, 123, Para 4.103, 4.109 and Table 4.8 on telecoms
In the next years, India can expect to see a huge increase in the demand for mobile broadband access, most users probably demanding higher download speeds than the target of 2Mbps set for 2020.
EU Question 88: How does India intend to address the massive demand and expand capacity? What will be the role of foreign investors?

Reply: India welcomes investment in telecom infrastructure for expansion of broadband services. FDI policy has already been liberalized and 100% FDI is permitted for all telecom services. Private investment is also being encouraged through policy measures. In addition, public investment through the USO fund is being taken up to extend broadband to rural and remote areas across the country.
EU Question 89: Can India provide more information about the ongoing reform in the postal sector, in particular about the changes in the structure of the India Post. How will it affect the scope of the postal monopoly?

Reply: The Indian Post Office Act, 1898 clearly lays down monopoly of Central Government viz the Department of Posts, in carrying letters. However, owing to the fact that the word "letter" has not been defined in the said Act, makes it difficult for the Department to enforce this monopoly. As a result, the private couriers carry letters in the name of documents. The Indian Post office Act is under examination in the Department and amendments are being worked out in order to make it up-to-date and resolve the anomalies by also defining the word letter.
International Postal Business is regulated by UPU Conventions established in 1874. It is the primary forum for cooperation between postal sector Players. Postal services have been identified as a sub sector under the sector communication service which also has the courier services as a sub sector.
As per the directions of the Hon’ble Prime Minister of India, an inter-Ministerial Task Force on leveraging the Post Office network headed by Sh TSR Subramanian, former Cabinet Secretary, was constituted in August 2014. The recommendations of the Task Force were submitted in December 2014. The Task Force has made several recommendations about the re-structuring the Department by setting up Strategic Business Units for different businesses of the Department, such as, E-Commerce, Banking, Insurance and Retail. Setting of these corporate SBUs will also require amendments to the IPO Act, 1898. The recommendations of the Task Force are under examination in the Department and a decision shall be taken about any structural changes in consultation with the various stakeholders.
The Department is presently fulfilling its Universal Service Obligations without getting compensated by other private players in the market, who operate only in the profitable areas and segments and whose operations are also presently not perfectly within the legal sphere.
Page 124, Para 4.114-cabotage
EU Question 90: Could India indicate to what extent the exemptions from cabotage restrictions granted in the years 2012-2013-2014/2015 referred to trading of international cargoes (e.g. feedering and relay practices) and/or movement of empty containers?

Reply: The details of chartering permission given to foreign flag vessels are as mentioned below:

Year	2012-13	2013-14	2014-15
International Cargoes	1180	1082	1650
Empty containers	0800 TEUs export-import containers from Nhava Sheva to Mundra Port and back, granted on 05.12.12	1000 x20' and 700x40' import empty 600x20' 2500 TEUs from Nhava Sheva to Mundra in the lay can 28.10.13 to 29.11.13 granted on 04.11.13	1. 500 TEUs empty containers from Nhava Sheva to Pipava Port granted on 27.06.14 2. 500 TEUs empty containers from Nhava Sheva to Mundra Port granted on 11.07.14 3. 1000 TEUs empty containers from Nhava Sheva to Pipava Port granted on 16.07.14. 4. 1000 TEUs empty containers from Nhava Sheva to Mundra Port granted on 25.07.14. 5. 1000 TEUs empty containers from Nhava Sheva to Mundra Port granted on 11.08.14.

With regard, specifically, to signalling systems under the terms of a guideline issued by the Railway Board, suppliers of software embedded electronics systems and technology products for railway signalling are obliged to set up indigenous manufacturing and testing facilities in India. Furthermore, the same suppliers shall commit to a progressively phased indigenization programme of supply in respect of manufacturing that must reach 100% in three years' time further to the market entry.

EU Question 91: Which plans does India have on the short/medium term to attract FDI and to what extent are the above mentioned measures compatible?

Reply: To attract FDI, sectoral guidelines for Domestic/Foreign Direct Investment in Rail sector including signalling systems have been issued by Ministry of Railways in Nov, 2014.
Page 129 para 4.145 - Professional services
The legal services sector is an essential enabler to attract and promote foreign investment. However, India continues to maintain stringent restrictions on this vibrant international sector – against the trend noticed in many of India's emerging neighbouring countries.
EU Questions 92: Could India indicate if in a bilateral agreement it has waived the nationality requirement on a reciprocal basis? If so, with which country?

Reply: The Bar Council of India (BCI), a statutory body under the Advocates Act 1961, and the legal services regulator in India, entered into an MoU with the Law Council of Australia in the year 2010 for an agreement with regard to exchange of law students and law teachers. The BCI is also in dialogue with regulators in many countries such as the USA, UK, Japan, etc. with respect to commercially meaningful access for lawyers and law firms on reciprocal basis. The matter regarding opening up of legal services in India to foreign lawyers/law firms, on reciprocal basis, is currently under consideration by the Government of India in consultation with the BCI and other stakeholders.
EU Question 93: Can India provide more information on the justification for banning foreign law firms? Does the government have any plans to allow more competition within the corporate legal sector? Are there any intentions to open up this sector?

Reply: The matter regarding opening up of legal services in India to foreign lawyers/law firms is currently under consideration. Any decision in this regard will be taken by the Government of India in consultation with the Regulator, the Bar Council of India, and other stakeholders. Any decision on this matter will however be subject to, inter-alia, the principle of reciprocity, which is provided for in the Advocates Act, 1961.
Page 130, Para 4.147 - Professional services