US equates India with China, says trade regime not transparent

The US today blamed India for being non-transparent in its trade regime, virtually equating it with China, by stating that its import tariffs are "cascading" and cost-prohibitive for the American companies.

"India maintains a system of cascading tariffs, taxes and other import charges that taken together are often cost-prohibitive," US trade representative Ron Kirk said in the National Trade Estimate Report, delivered to the Congress.

He said India's tariff schedule (rates of customs duties) "is not publicly available in one transparent, easily accessible location" which imposes "significant" burdens on the importers.

Kirk said India's tariff regime is characterised by "pronounced disparities between the bound rates (the rates that under World Trade Organisation rules generally cannot be exceeded) and applied rates (the actual rates charged) and the average applied rate is among the highest in the world".

Noting that India's legal and regulatory regime lacks transparency across all sectors, Kirk said the US firms report unnecessary burdens, bureaucratic delays, discrimination and corruption as a result of unclear and inconsistent implementation of India's trade and investment rules.

"Problems are encountered across all sectors, including government procurement, the tariff structure, import requirements, and investment policies," he said.

In his report, Kirk said China's industrial policies limit market access by non-Chinese origin goods by protecting favored sectors and industries, using tools like standards, local content rules, and government procurement regulations.

Further, China maintains prohibitions on foreign participation, restrictive licensing systems, foreign equity limitations, restrictions on scope of business and other

measures that limit or block market access in a variety of services sectors, he said. The report also carries trade restrictions from the European Union, Indonesia, Japan,

South Korea, Malaysia, Kenya, Nigeria, Mexico, Russia, South Africa and Thailand.

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