WORLD TRADE  
ORGANIZATION   
G/LIC/Q/IND/21 
1 November 2012 
 (12-6020) 
Committee on Import Licensing Original:   English 
  
 
IMPORT LICENSING SYSTEM OF INDIA 
 
Replies by INDIA to the questions from TURKEY 
  
 The following communication, dated 29 October 2012, is being circulated at the request of 
the delegation of India.  
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 India thanks Turkey for the Follow-up questions on its Import Licensing System dated 11 May 2012 and circulated in document G/LIC/Q/IND/20 .  
 
Q 1. Which products are subject to the impo rt licensing regime? (as DGFT Notification 
No.64 dated 4 August 2011 refers only to pro ducts covered under HS Code No. 25151100 and 
25151200).  
  In its reply, India stated that other products under the two other HS Codes (25151220 and 25151290) were also restricted for imports;  but did not specify the exact regulation.  
 
 We are still in need of the exact reference to the legislation regulating the import of 
products covered under HS Co de No. 25151220 and 25151290. 
 
Reply:  The products covered by HS code 25151220 and 25151290 are restricted for imports as per 
Chapter 25 of Schedule I- Import Policy under ITC (HS) 2012. The procedure for import of such 
restricted items is given in paragraph 2.36 of th e Handbook of Procedure (Vol.-I) which is available 
on the website www.dgft.gov.in.    
 
Q 2. How the restriction on imports of marble  and similar stones would alleviate concerns 
regarding "safety, security and the environment"?   
 In its reply, India referred to the environmen tal effects of processing of marble blocks. 
India also stated that marble mining on th e one hand and cutting and further processing of 
marble blocks on the other have an equal effect on environment.   We wonder if there is any scientific study that can be cited by India indicating that the 
marble processing and marble mining have hazard ous effect on the environment and that they 
are similar.   Moreover, in 2010, India exported around 1 million tons of processed granites, ranking 
the second among processed granite exporting countries.  We believe that the "potential" effects, if any, of marble and granite processing  to the health and environment are the same.  
 G/LIC/Q/IND/21 
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   Thus, we wonder how India regulates granit e processing regarding safety, security and 
the environment concerns.  
 
Reply:  Since marble and granite are entirely differ ent products, we are not clear on Turkey's rationale 
for indicating that their potential eff ect on the environment is the same. 
   
Q 3. Why is the eligibility criterion restricted in the manner set out in the relevant Notification, i.e. five years long operation?    India answered by stating that the eligibility criterion changed with DGFT Notification 
No. 64.  After an examination of the said Notifi cation however, we still observe that the 5 years 
long operation requirement is still there with  some additional eligibility requirements. 
   India also stated that the reason for the above-mentioned requirement is the aim to 
ensure adequate manufacturing ca pacity.  This, however, sta nds in contradiction to the 
Article 3(5)j of the Import Licensing Procedures  Agreement which states "Consideration shall 
be given to ensuring a reasonable distri bution of licenses to new importers…".  
 
Reply: The eligibility criteria is not in any way cont rary to Article 3(5)j of the Agreement on  Import 
Licensing Procedures. New importers are eligible to  apply provided they meet the criteria mentioned 
in Notification No 64 dated 4.8.2011.   
 
Q 4.  Why India imposes a ceiling level of 300.000 metric tons?  
  India replied by stating that the ceiling for imports is now 500.000 metric tons.  This, 
however, does not change the fact that India's import licensing system is still a quantitative 
restriction as it has restrictive effect on importation.  
  Moreover, in its reply to Turkey's questio n regarding the eligibility of units that may 
make applications for import licenses, India replied by stating that the said criteria was 
intended to ensure adequate and sustainable manuf acturing capacity.  Thus, we wonder if India 
has data regarding its domestic marble cutting and processing capacity.  If the answer is yes, we 
would like to know if the ceiling for imports of 500. 000 metric tons enough for total capacity of 
India for marble cutting and processing.    It is to our belief that the quota determ ined is still very restrictive, far away from 
meeting market demands in India. 
 
Reply:  The quota has been progressively increased from 300,000 MT in 2010 to 500,000 MT in 2011 
and 600,000 MT in 2012 vide Notification No. 12(RE-2012)/2009-2014 dated 22.08.12. The 
Notification is available on the website www.dgft.gov. in. As evident, the quo ta has been increased 
over the years based on increased market demand.    
 
Q 5. If the floor price is a license fee.  
   India replied by stating that it is the mi nimum import price to ensure quality of goods 
under import.  As is well known, the price of ma rble may depend on the variables on the supply 
and demand side.  Moreover, as the price of ma rble fluctuates within the year depending on 
market conditions, the price determined by I ndia for the whole year makes the link between 
price and quality, as stated by India, rather arbitrary.    We thus request India to explain the rationale behind its import pricing policy. On what basis can India argue that the floor price set for the importation of marble ensures quality?   G/LIC/Q/IND/21 
 Page 3 
 
 
  Reply:  Floor price is fixed on an annual basis for benchmarking the desired quality of import. It is 
administratively difficult to adjust the floor pri ce throughout the year to align it with market 
fluctuations in price on account of the demand and supply conditions.    
 
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