WORLD TRADE ORGANIZATION  
ORGANISATION MONDIALE DU COMMERCE  
ORGANIZACIÓN MUNDIAL DEL COMERCIO  WT/TPR/M/182/Add.1 
20 July 2007 
 (07-3107) 
Trade Policy Review Body 
23 and 25 May 2007 Original:   English/Spanish 
 anglais/espagnol  inglés/español 
 
 
TRADE POLICY REVIEW 
INDIA 
Minutes of Meeting
 
Addendum  
Chairperson:  H.E. Mr. Vesa Himanen (Finland)  
 This document contains the advance writte n questions, and replies provided by India.1 
 
_________________________________________________________________________________ 
Organe d'examen des politiques commerciales 
23 et 25 mai 2007 
 
EXAMEN DES POLITIQUES COMMERCIALES 
INDE 
Compte rendu de la réunion  
Addendum  
Président:  S.E. M. Vesa Himanen (Finlande) 
 
 Le présent document contient les questions écrites communiquées à l'avance et les réponses 
fournies par l'Inde.1 
 
__________________________________________________________________________________ 
Órgano de Examen de las Políticas Comerciales 
23 y 25 de mayo de 2007 
 
EXAMEN DE LAS POLÍTICAS COMERCIALES 
INDIA 
Acta de la reunión 
Addendum  
Presidente:  Excmo. Sr. Vesa Himanen (Finlandia) 
 
 En el presente documento figuran las pr eguntas presentadas anticipadamente por escrito, 
junto con las respuestas facilitadas por India.1 
 
 
                                                      
 1 In English and Spanish only./En anglais et espagnol seulement./En inglés y español solamente.  WT/TPR/M/182/Add.1 
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  WRITTEN QUESTIONS BY MEMBERS 
QUESTIONS FROM SINGAPORE  
 
Tariffs and other import charges 
 
Re WT/TPR/S/182 page 98, "India charges a 4% special additional duty (also known as special countervailing duty) to bring the overall tax rate  on imported goods more into line with that on 
domestically produced goods, which are subject to in ternal taxes, such as VAT, municipal tax, 
“market committee fees”, etc.” 
 
 Could India explain how the equivalen ce between the special additional duty and 
“domestically produced goods, which are subject to internal taxes, such as VAT, municipal tax, 
“market committee fees”, etc.” is established?   Has India imposed this measure in the past? If so, what was the duty rate?  If there was a 
change in this duty rate over the year s, what was the reason for this change? 
  Is this special additional duty applicable for all products? On what conditions could this duty 
be exempted?  Information Technology 
 
Re WT/TPR/S/182 page 125, “although the excise duty on computers is 12.5%, exemptions are in 
place for microprocessors for computers, hard disc drives, floppy disc drives, CD Rom, DVD drives, 
USB flash memory and combo drives, as well as parts, components, and accessories for mobile 
handsets including cellular phones”.   
  Could India, a WTO Information Technology Agreement (ITA) participant, explain why an excise duty of 12.5% is imposed on computers, wh ile exemptions are provided for other products 
covered under the ITA?    
 Would such a tariff measure be considered a form of tariff escalation? 
 
Export Restrictions 
 
Re para 87 of the Secretariat Report, India main tains export prohibition u nder Foreign Trade Policy 
for environmental, food security, marketing, prici ng and domestic supply reasons  and to comply with 
international treaties. We also note that since 2002, India had added a few more products to its list of 
prohibited exports.  
• It would be useful if India could clarify how  its export prohibitions tally with GATT Art XI 
which generally prohibits im port and export restrictions except under a few pre-defined 
situations?  
 
Services 
 
We note that services has been playing an increasingly important role in the Indian economy. It is notable that average annual growth over the past 4 years has been 9.8% largely due to reforms in 
certain sectors such as financial services and telecommunication services.  However, as noted by the 
Secretariat, infrastructure remains a major bottleneck. In this connection, we note that infrastructural WT/TPR/M/182/Add.1 
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  services such as maritime and port services continue  to suffer from inefficiencies and constitute a 
major impediment to trade.   
• It would be useful if India could elaborate on its plans to reform infrastructural services such 
as maritime transport services. In particular, do es India evisage greater liberalization in such 
sectors  to facilitate greater competition and efficiency.     
  
QUESTIONS FROM NEW ZEALAND
 
 
Introduction 
  India’s report (WT/TPR/G/182, page 5, paragrap h 2) notes that the growth rate in Indian 
agriculture has fluctuated sharply, from 10% in 2003-04 to 0% in 2004-05 and an estimated 2.7% in 2006-07 (also noted on page 13, paragraph 48).  Ca n India comment on the factors that have 
contributed to this variation in growth and outline its policies to reform agricultural production?  In 
particular, could India explain how high agricultu ral tariffs will contribute to improved agricultural 
growth (page 13, paragraph 48)? 
 
Economic Environment
 
 Recent Economic Developments:  Economic Performance 
  The Secretariat’s report (WT/TPR/S/182, pa ge 5, paragraph 9) and India’s report 
(WT/TPR/G/182, page 14, paragra ph 57:  Major Challenges to Gr owth: Skill Deficit in Manpower) 
refers to India’s demographic profile and the gr owing shortfall in suitable professionals.  India’s 
report suggests that a major reform of all levels of education is required.  Could India comment on the 
nature of reforms required and the implications for private and overseas education providers which 
may wish to operate in India? 
 
Trade Policies and Practices by Measure
 
 Measures Directly Affecting Imports: Tariff Average, Dispersion and Escalation 
  The Secretariat’s report (WT/TPR/S/182, page 41, paragraph 28) refe rs to reductions in 
India’s average tariff on non-agricultural products to  12.1%, whereas the average tariff for agricultural 
products is 40.8%.  New Zealand welcomes India’ s moves towards gradual tariff reform to reduce 
barriers to imports.  How does India plan to level ou t tariffs in the agriculture sector proportionate to 
other products? 
  The Secretariat’s report (WT/TPR/S/182, page  33, paragraph 2) states the gap between bound 
and applied rates continues to grow, and that the bound rates are high, especially for agricultural products.  This leads to uncertainty for importers.  Indeed, during the period under review, tariffs were 
substantially raised on 27 agricultural products.  Can India comment on the rationale behind such 
increases?  
Measures Directly Affecting Imports: Tariff Rate Quotas 
 
 The Secretariat’s report (WT/TPR/S/182, page 44, paragraph 33) notes that tariff-rate quotas 
(TRQs) are maintained on 14 tariff lines at the HS 8- digit level – but that some of these quotas have 
not been implemented in recent years.  For example, milk powder is subject to a TRQ (in-quota rate for up to 10,000 tonnes per year) but imports ha ve occurred in 2004 (233,629 kg) and 2005 (243,798  WT/TPR/M/182/Add.1 
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  kg) (see footnote 21, page 44).  Can India clarify whether imports on these 14 tariff lines have had 
out-of-quota tariff rates applied to them; and, if so, the reason behind the non-application of the TRQ?  
Measures Directly Affecting Imports: Other Charges Affecting Imports 
  The Secretariat’s report (WT/TPR/S/182, page 44, paragraph 34) states that in relation to 
tariffs, import duties vary from state to state for cer tain products.  We note that this is the case for 
wine.  Can India explain why it allows for this va riation and how it plans to address the issue?   
  The Secretariat’s report also outlines the impos ition of additional duties and special additional 
duties (WT/TPR/S/182page 33, paragraph 1; page 44, paragraph 34,).  Are there plans to simplify the 
import duty structure?    
Measures Directly Affecting Imports: Import Restrictions and Licensing 
 
 The Secretariat’s report (WT/TPR/S/182, page 47;  paragraph 40) notes that India monitors the 
imports of some 300 items considered to be sensitiv e.  Could India elaborate on the nature of this 
monitoring and any implications for import levels and policy? 
 
Measures Directly Affecting Imports: Sanitary and Phytosanitary Measures  
 The Secretariat’s report (WT/TPR/S/182, page ix, paragraph 12 and pages 53-56, section xii) 
states that India’s SPS procedures are being streamline d, notably with the passage of the Food Safety 
and Standards Act in 2006 to consolidate 13 separate laws relating to SPS issues; in addition, a risk 
analysis process has been put in place since 2004.  New Zealand welcomes India’s moves to consolidate its SPS procedures.   
 
Questions:  (1) Would India be willing to outline key elements  of its process for determining SPS measures on 
imported products? 
(2) New Zealand has asked India on a number of occasi ons for their risk analyses for dairy and meat 
products, but has yet to receive this information.  Would India be willing to make available their 
risk analyses which were used to determine th e sanitary import conditions for meat and dairy 
product imports? 
(3) With the consolidation of India’s laws for food, what processes and standard s that are applied to 
imports, are also required of their domestic industries? 
 
Measures Directly Affecting Exports: Measures Maintained by Importing Countries 
 
 The Secretariat’s report (WT/TPR/S/182, pages 63-64, paragraph 90) comments that India 
believes that SPS measures maintained on mango impor ts into the United States, Australia, and New 
Zealand, are a barrier to its exports.  Can India elaborate on its concern? 
 
Measures Affecting Production and Trade: Taxation and Non-tax Assistance 
 
 The Secretariat’s report (WT/TPR/S/182, pages 79-80, paragraphs 137 and 138) notes that the 
largest direct subsidy to producers is provided fo r food (security) and that additional agriculture-
related support is provided in the form of fertiliser  subsidies and price support.  The Secretariat notes 
that the growing subsidy bill has been at the detr iment of public investment in infrastructure and 
research and development.  Does India intend to refo rm, as the Secretariat s uggests, the way that the 
food and fertiliser subsidies are targeted, and the method of setting minimum support prices for certain agricultural products? WT/TPR/M/182/Add.1 
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  Trade Policies by Sector
 
 Introduction  
 The Secretariat’s report (WT/TPR/S/182, page 99, paragraph 2) suggests that the demand for 
“essential commodities” is declining in favour of vegetables, milk and meat and that a major 
reorientation is required in th e Government’s agricultural policy.  Could India comment on the 
prospects for any major change in India’s agricu ltural and trade policy given the changing demand for 
agricultural commodities?  
 
Agriculture 
 
 The Secretariat’s report (WT/TPR/S/182, page 102, paragraph 10; also  page 102, paragraph 
10) states that subsidised inputs such as fertiliser, water, and power have, in some cases, led to 
overuse and problems of water-logging and salinity, as well as degradation of natural resources, and 
notes that there appears to be little change to the basic policy of supporting producers by subsidising 
inputs through direct subsidies.  What actions does India intend to take to mitigate these effects, 
including actions on supporting producers?   The Secretariat’s report (WT/TPRS/182, page 100, paragraph 6) reveals that India was the 
world’s biggest dairy producer in 2003/04 and that its production of milk has increased substantially, 
with around 91 million tonnes produced in 2004/05.  A related and rapidly gr owing activity is food 
processing.  New Zealand notes the rapid developmen t and growth of this industry.  Could India 
comment on the SPS measures that it requires from its domestic producers, and how these match the requirements for imports?   
 
India and WTO: Some Impediments to the Growth of India’s International trade  
 
 India’s report (WT/TPR/G/182, page 33, paragr aphs 162-165) notes that the rising incidence 
of non-tariff barriers, in the form of sanitary and phytosanitary (SPS) measures and technical barriers 
to trade (TBT) has emerged as a major trade concer n, particularly as such new measures very often 
have market access implications.  New Zealand notes India’s concerns regarding restrictive access for 
its exports due to certain SPS and TBT measures.  Could India comment on how it has ensured that its 
own SPS measures are consistent with international st andards and do not unfairly restrict access to the 
Indian market?    QUESTIONS OF SWITZERLAND
 
 
Report by the Secretariat 
I. Economic Environment 
 
(1) Overview  
Para. 2:  According to §2, exports are now considered a main engine of growth alongside domestic 
consumption and investment. In the report submitted by India, §65 mentions that the scheme for the 
Special Economic Zones (SEZs) has been an importa nt policy initiative for export promotion. From 
an economic perspective, it is preferable to re duce import duties, which act as an indirect tax on 
exports, rather than granting tax exemptions to specific industries or areas, which may lead to 
economic inefficiencies. Which industries are targ eted and based on which criteria? Moreover, SEZs 
may encourage investment diversion, leading to revenue losses in a context of ongoing efforts to 
broaden the tax base (§18). How does the Indian delegation assess the fiscal costs of SEZs?   WT/TPR/M/182/Add.1 
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  Furthermore, as para. 2 of the summary observations  suggests, India appears to be facing a complex 
set of schemes which are creating notably biases against exports that in turn need to be corrected by a 
multitude of other measures of a microeconomic na ture, including subsidies, to re-establish their 
international competitiveness. Such a flurry of individual measures, which do not seem to be 
necessarily consistent with each other, appears theref ore to be a rather inefficient way to promote or 
re-establish the competitiveness of exports. Do the I ndian authorities have any plans to modernize and 
simplify their indirect taxation structure, and if not, why?  
(4) Developments in foreign investment 
 Question not related to a specific paragraph : The government of India had informed us at the last 
TPR that  it had set up a high-level committee on "Reforming Investment Approval and Implementation Procedures" and w as expecting its recommendation at that time. Could the Indian 
authorities be so kind to share the main features of the recommendations and also inform which of 
these recommendations and to what extent had been implemented in the meantime? 
 
Para. 39 : The Secretariat's report indicates that Mauritius benefits from a tax treaty with India, an 
advantage of which being that investment is exempt  from the capital gains tax. As a result, Mauritius 
is the most important country of origin of FDI in India. Could India list the main features of the tax treaty between Mauritius and India? Could the Indian authorities indicate whether Mauritius is the sole country benefiting from such a tax advantage and whether there are plans to extend this tax 
benefit to other nations?  
 
II. Trade Policy Regime: Fr amework and Objectives 
 
(1) General institutional and legal framework 
 
(i) Institutional and legal framework 
 
General question not related to a specific paragraph : We understand that India as a federal country 
has competences allocated to the central level and ot hers to the state level. While issues relating to 
international trade are the prerogative of the central  level, subject matters which may also be dealt 
with in international trade agreements belong more  broadly to the state competences. How is this 
being handled when an international agreement is being negotiated and ratified? In case a state would 
not abide by the rules of an intern ational agreement in a field that falls into its competences, what 
measures, if any, would the central government have  at its disposal to make sure that India's 
international obligations are fully implemented? 
 
(2) Trade policy objectives 
 
Para. 13-14 : India's Foreign Trade Policy acknowledges the importance of facilitating imports 
required to stimulate the economy and calls for a si mplification of import procedures and reduction of 
import barriers, and coherence a nd consistency between trade and other economic policies. Could 
India indicate whether specific import simplification procedures have already be identified and if so, 
could India please list these measures? In the same ve in, could India specify which measures could be 
envisaged to ensure to neutralize "... the inciden ce of all levies and duties on inputs used in export 
products based on the fundamental principle that duties and levies should not be exported"?   (3) Trade agreements and arrangements  (iii) Other trade arrangements 
 
Para. 37:  Could the Indian authorities indicate when they plan to introduce duty free and quota free WT/TPR/M/182/Add.1 
Page 8  
 
  market access for LDC? Will this be a phased-in in troduction or will India already cover 100% of its 
tariff lines? 
III. Trade policies and practices by measures  
(1) Overview 
 Para. 8 : Could India indicate the purpose of the central sales tax on inter-states sales of goods? 
 
(2) Measures directly affecting imports 
 (ii) Customs valuation and clearance 
 
(a) Valuation  Para. 16 : according to paragraph 16, India uses referen ce prices for the valuation of certain goods. 
How does India assure that by that it is not imposing minimum prices prohibited by Art. 7 (f) of the 
CV Agreement? 
 Para. 18 : this paragraph mentions expedite and simp lified import procedures for "accredited clients". 
Could India indicate the criteria as well as the proce dure to be eligible for such special treatment? 
 
(iii) Tariffs 
 
(a) Overview  Para. 21: According to the report, tariffs remain a major source of revenue for the Central 
Government (23%).  With the planned shift fro m VAT to GST do you foresee any incidence on the 
percentage contribution of these internal tax es to government revenue? When will the GST be 
implemented? What is the main difference with the current VAT scheme? 
 
Para. 21 (and 25 ): this paragraph indicates that the applied tariffs - notably those subject to 
exemptions - are being announced with the annual B udget, but that rates may be subject to changes 
during the year. These changes are made on an ad hoc basis through gazetted notifications. Does India 
plan any internet based publication of these applied rates? 
 
(iv) tariff exemptions 
 
Para. 31 : In the Budget speech delivered in February 2006, the Minister of Finance acknowledged the 
complexity of the tariff exemptions. Which measures are foreseen to reduce this complexity of these 
schemes? Does India plan any measures to enhan ce transparency on these schemes? What is the 
duration of the exemptions relate d to industrial use? What are the requirements to demonstrate a 
specific industry use in order to be eligible for exemption? How does India avoid fraud? How does the 
government avoid discretionary treatment by customs officials? Is it possible to obtain some kind of 
advance rulings in this matter? 
 
(v) Tariff rate quotas 
 
Para. 33 : Could India provide some more clarity on its TRQ administration related to milk powder? 
  WT/TPR/M/182/Add.1 
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  (vi) Other charges affecting imports 
 
Para. 34 : Unfortunately, the explanations on the special duty are not totally clear to us. Could India 
give some more insight in the difference that still prevails between that special duty and other 
domestic taxes? How does India concede that these domestic taxes are in some instances lower (or 
higher) than the 4% special duty without infringing Art. II of the GATT?   
 
(x) Contingency measures 
 
(a) anti-dumping and countervailing measures 
 
Para. 41 of the Secretariat's report suggests that the Directorate General of Anti-Dumping and Allied 
Duties (DGAD) in the Ministry of Commerce and I ndustry can initiate an anti-dumping investigation 
on its own initiative if it is satisfied that there is ju stification to launch such an investigation. Could 
the Indian authorities indicate under what circumstances and on the basis of what criteria DGAD 
would they conclude that there is justification to  launch an anti-dumping investigation even in the 
absence of a complaint by the domestic industry?  
(xi) Standards and other technical requirements 
 
(a) Standards 
 
Para. 53 : Some 53% of standards issued between Ju ly 2002 and October 2006 are harmonized with 
ISO/IEC standards. According to the authorities, th e process of reviewing identified standards where 
ISO/IEC standards exist, is being expedited.  In ad dition, a greater percentage of sectoral standards, 
for example, in chemicals, petrochemicals, electrica l and electronic industries, tend to be aligned with 
ISO/IEC standards. Switzerland welcomes the fact that more than half of the national standards 
adopted in this time period are harmonized with IS O/IEC standards. We woul d however appreciate to 
receive more information about the degree of harmon ization with international standards in the field 
of medical devices.  
(xi) Standards and other technical requirements 
 
(b) Product certification  Para. 54 : Although ISI certification is voluntary, it has b een made compulsory for 66 products related 
to health and consumer safety (133 at the time of th e last Review).  It is not clear, which products 
have been removed from the list. Switzerland would be very interested in knowing which products 
require compulsory certification. What criteria are applied to decide whether a product requires compulsory or voluntary certification? For product areas with mandatory certification we would also be interested to know whether foreign test reports and certificates are accepted.  Para. 54 : Product certification can also be granted outside India once the manufacturer's production 
facilities have been approved and licensed by the BIS. Does India accept OIML (International 
Organization of Legal Metrology) certificates issued by a member of that organization?   
(xiv) Government procurement 
 Para. 78 : The report indicates, that India is not a party to the WTO Agreement on Government 
Procurement (GPA) and that it firmly rejected in the past the idea of such a participation. As 
evidenced by the Secretariat, India made valuable efforts to increase transp arency and competition in 
its procurement system, mainly through improveme nts in the field of electronic procurement as 
explained in § 72. The new actions undertaken by India to improve the fight against bribery in WT/TPR/M/182/Add.1 
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  government procurement (§ 77) is also a positive st ep in the direction to the standards the GPA-
Members recently agreed upon. Finally, the system of preferential policies at  central government level 
has be extended until 31 March 2008. All these measure s are bringing India closer to the revised 
GPA. What are, today, the views of the Indian au thorities with regard to the objective of joining the 
GPA? What are, if any, the major obstacles to be eliminated for realizing this objective? 
 
(3) Measures directly affecting exports
  
 (iii) Export taxes 
 Para. 85 : Could the Indian authorities provide us with a cl osed list of products that remain subject to 
export taxes?  
(v) Export prohibitions, restrictions, and licensing 
 (a) Export prohibitions 
 Question not related to a specific paragraph : How are export prohibitions or controls regulated 
with regard to the export of arms and sensitive dua l-use goods (as controlled e.g. by the international 
export control instruments such as the Wassenaar  Arrangement, the Australia Group, the Missile 
Technology Control Regime, MTCR and the Nuclear  Suppliers Group, NSG; India, a non-member, 
has shown willingness to adhere voluntarily to the guidelines of the NSG and the MTCR)? 
 
(x) Export finance, insurance and guarantees 
 
Para. 103 : In para. 103, the Secretariat's report notes that under the current guidelines on lending to 
the priority sectors, 12% of net bank credit (within the overall target for foreign banks of 32% of net 
bank lending stipulated for priority sector lending) must be loaned to the export sector by foreign banks having offices in India and that loans have to be provided at concessional rates of interest. 
Could the Indian authorities explain why they deem such a scheme as necessary and how they reconcile the long-term needs of improving the economic efficiency and competitiveness in the 
priority sectors with an apparently permanent provi sion of concessional financing? In addition, could 
the Indian authorities indicate whether they have plan s to remove this differe nt treatment of foreign 
banks compared to the domestic banking sector give n that such a treatment is not only affecting 
negatively the competition situation on the Indian banking market but also represents a disincentive for the domestic banking sector to become more ef ficient? Also, could the Indian authorities explain 
how they reconcile this indirect subsidy to expor ts with Article 3.1(a) and Annex I (k) of the 
Agreement on Subsidies and Countervailing Measures which explicitly prohibits export subsidies?   
 
(v) Intellectual property 
 
(b) Industrial property  
Para. 157 : In Paragraph 157 of its Report, the Secretariat refers to the new Patents Act, which became 
effective on 1 January 2005. Switzerland would like to commend India on its efforts to put Indian patent legislation in conformity with the TRIPS Ag reement. Since the new Patents Act hasn't yet been 
subject to review, Switzerland seizes the present opportunity to address a number of points where 
clarification is requested: 
 
•  Section 25 of Patents Act 2005 provides for two opposition procedures in the context of the 
application and granting of patents (pre- and post-grant opposition) . Both these oppositions 
may be lodged on the same lega l grounds. As far as the pre-grant opposition, it seems that no  WT/TPR/M/182/Add.1 
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  proof of "interested person" needs to be registered in order to file an opposition. The 
opposition procedures as laid down in the new Pate nt Act may result in considerable delay 
and legal uncertainty for the pa tent applicant. On this bac kground, please explain whether and 
what procedural safeguards have been put in  place in order to ensure in practice an 
application of section 25 (1) of the Patents Act which is compatible with the requirements in 
Article 62.4 in combination with Article 41.2 and 3 of the TRIPS Agreement, in particular the 
requirement that such procedures shall not entail unwarranted delays. Please indicate also what legal remedies are available to the pate nt applicant/holder against the suspension or 
rejection of his patent application or patent  on the ground of a pre- or post-grant opposition. 
 
•  According to Section 11A of the Patents Act,  for patents relating to pharmaceuticals filed 
before 1 January 2005 (the "Mailbox"), the pa tent holder may not institute infringement 
proceedings against manufacturers already pro ducing the patented product at the time the 
patent is granted. In such cases, the patent hol der is said to be entitled to receive reasonable 
royalties. Article 28 of the TRIPS Agreement confers on the right holder of a patent, among other exclusive rights, the right to make  the patented product. Furthermore, the law does 
neither define "reasonable" nor the authority for determining the royalty. Please explain how 
this provision complies with Article 70.8 lette r (c) in combination with Article 28 of the 
TRIPS Agreement and how it is applied in practice. 
 
•  According to Section 3(d) of the Patents Act,  new forms of a known substance not resulting in 
the enhancement of the known efficacy are not c onsidered inventions under the Patents Act. 
In an explanatory note to this clause, the Pate nts Act further enumerates a number of such 
forms, which shall be considered to be the same substance, unless  they differ significantly in 
properties with regard to efficacy. Considering th at in the pharmaceutical sector, the testing of 
efficacy, safety and other clinical aspects of the product or its new form is very time-consuming and costly and thus only undertaken once the patent application is filed, please 
explain how the applicant can meet, in practice, the requirements set out in Article 3(d) of the 
Patents Act at the time of the patent application? 
 
•  Referring to Article 39.3 of the TRIPS-Agreem ent and the issue of unfair commercial use of 
test data submitted by an application to the responsible State Agency in the procedure for 
market authorization of a pharmaceutical or of an agricultural chemical product and the 
protection of such test data against reliance by a second applicant, a national Committee of 
experts is said to still examine the matter in  India to come up with a proposal for national 
legislation. Please indicate when the report of the Committee is supposed to be available and 
when national legislation implementing Article 39.3 of the TRIPS Agreement is expected to 
enter into force? 
 
IV. Trade Policies by Sector 
 
(5) Services 
 
Question not related to a specific paragraph : Could India indicate the conditions governing the 
temporary entry of natural persons that are empl oyed by a foreign machine building company and 
enter India in order to install or maintain industrial machinery or equipment of the company? 
 
Report by the Government of India 
VI. Strengthening sectoral markets 
 
(f) Financial sector WT/TPR/M/182/Add.1 
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  (ii) Reforms in the foreign exchange market 
 Para. 114 : The Report of the Government states that certain qualified Mutual Funds are permitted to 
invest in overseas exchange traded funds. Could you please specify the qualification requirements that 
are to be met by Mutual Funds in order invest overseas? 
 
Para. 114 : The Report of the Government also points to the introduction of the Liberalised 
Remittance Scheme whereby resident Indians were  permitted to remit up to US$ 25'000 per calendar 
year for any current or capital account transaction. Ar e there any further legislatory projects by Indian 
authorities to gradually open up capital and current account restrictions for resident Indians? 
 
VII. India and the WTO 
(a) Intellectual property rights 
 
Para. 142 : In Paragraph 142 of its Report, India menti ons the introduction in the Patents Act of a 
provision enabling the grant of a compulsory licen ce for exportation in accordance with the WTO GC 
Decision of 30 August 2003 on the Implementation of  Paragraph 6 of the Doha Declaration on the 
TRIPS Agreement and Public Health. The mechanis m provided therein includes measures to prevent 
misuse for commercial purposes and diversion in orde r to ensure that such pharmaceuticals actually 
reach the country of destination through specific la belling or marking to identify the products as being 
produced under the system. Suppliers should dist inguish such products through special packaging 
and/or special colouring/shaping. Please indicate whether and where India has actually implemented 
these measures.   
COMMENTS AND QUESTIONS FROM THE EUROPEAN COMMUNITIES
 
 
I.  ECONOMIC  ENVIRONMENT 
(iii) Structural reform (a) Tariff and tax reform  WTO Secretaria's Report, page 11, para. 22 
1. What is the likely timescale for the merging of VAT, services tax and central excise duty to 
be merged into a more general goods and services tax (GST)?  
India's report page 17, para. 69  
India's report states that Central Sales Tax will be reduced from 4% to 3% from 1 April 2007.  
2. What is the likely timescale for th e total abolition of this tax?  
WTO Secretariat's Report, page 13, para. 30 
It is stated that "Part of the problem in implemen ting a more flexible labour market policy is the lack 
of a social safety net. The National Common Mi nimum Programme (NCMP) acknowledges that some 
changes in labour laws may be required, provided they fully protect the interests of workers and 
families and take place after consultation with trade unions". 
3. Could India provide more deta ils regarding this programme?   WT/TPR/M/182/Add.1 
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  WTO Secretariat's Report, page 13, para. 31 
The report states "The Government has taken certain  initiatives, such as upgrading technical institutes 
so that they can produce a multi-skilled workforce, a nd training so that existing skills can be adapted 
to changes in technology.  A skills development in itiative through public-private partnerships is to be 
started; it is envisaged that this would provide trai ning to a million workers in the first five years and a 
million workers annually thereafter."  
4. Could India provide details of the skills  development initiative and skills-upgrading 
programmes that have to be undertaken?  
II.  TRADE  POLICY  REGIME:  FRAMEWORK  AND  OBJECTIVES 
(2) T RADE POLICY OBJECTIVES  
 
Sustainable development  
5. Could India provide some in formation about how the issue of trade and sustainable 
development fits into its overall development strategies? Have any particular measures been 
taken since the last Trade Policy Review in 2002? 
Trade and environment  
 
6. What mechanisms does India have in place to ensure coordination of  environmental policy 
and trade policy? 
 
Trade and Labour 
India's Report, page 19, para. 81 
The Indian report states "India has initiated a series of  measures in the past few years to restructure 
the textiles and clothing industry to prepare it for a quota-free regime.  The textiles and clothing sector 
is labour-intensive and is the second largest employer in India (after agriculture). As a part of the 
overall policy of de-regula tion and de-control, the Government of India has de-reserved garments, 
hosiery and knitwear from the Small Scale Industries sector."  
7. How does the Indian government ensure the quality of jobs, and consequently high 
productivity, in labour-intensive sectors including the implementation of core labour standards?  
(3) T
RADE AGREEMENTS AND ARRANGEMENTS  
(ii) Regional Trade Agreements 
WTO Secretariat's Report, page 24, para. 21 
8. Could India indicate the expected timetable fo r notifying its new Regional Trade Agreements 
to the WTO, in particular SAFTA?  
WTO Secretariat's Report, page 25, para. 22 an d WTO Secretariat's Report, page 27, para. 28 
9. Could India indicate, for both SAPTA/SAFTA a nd CECA, the volume and value of trade that 
the excluded products from the liberalization undertakings account for? Which are these WT/TPR/M/182/Add.1 
Page 14  
 
  products? In the case of CECA, how much trade wi ll be fully liberalization by the end of the 
transition period, in April 2009? 
 
WTO Secretariat's Report, page 26, para. 26 
10. Could India indicate how bilateral trade with Sr i Lanka has evolved since the entry into force 
of the FTA in 2000? How much trade (in volume and value terms) is currently fully 
liberalized?  
WTO Secretariat's Report, page 27, para. 31 
11. Has the early harvest scheme been completed and the related 82 products fully liberalized? 
Which are these products? How does India plan to  continue the liberalization process? How 
much trade and tariff lines does India intend to fully liberalize? 
WTO Secretariat's Report, page 27, para. 32 
12. In light of the ongoing negotiations with ASEA N, could India indicate how it intends to 
ensure full consistency and coherence between  this new agreement and the already signed 
Agreements with Thailand and Singapore? How does India plan to ensure the creation of 
genuine building blocks?  
III.
  TRADE  POLICIES  AND  PRACTICES  BY MEASURE 
(2) M EASURES DIRECTLY AFFECTING IMPORTS  
(i) Procedures WTO Secretariat's Report, page 35, para. 15 
The EC welcomes recent Trade Facilitation reform s in India, including the introduction of risk 
management measures. The EC would be grateful to know why India applies preshipment inspection 
requirements to certain products, including unshre dded scrap and certain types of second-hand cars. 
13. Are there any plans to phase out these requirements? 
Pre-shipment inspection is required for imports of te xtiles and textile articles. Imports of textiles and 
textile articles must be accompanied by a pre-shipme nt inspection certificate stating that they do not 
contain hazardous dyes prohibited under the Envi ronment (Protection) Act 1986. Pre-shipment 
inspection certificates are provided by 99 recognize d certifying agencies, including several based 
outside India.  
14. Does India recognize test results from testing labs in any country having recognition for 
certification purposes by the National testing authority of that country which in turn is a member of ILAC? In this case, would a pre-shipment certificate be required? 
 
(iii) Tariffs 
 
WTO Secretariat's Report, page 38 , para. 21  
It is stated that rates are changes on an ad-hoc b asis through gazetted notifications. This leaves a lot of 
uncertainty for the actors on the market.   WT/TPR/M/182/Add.1 
 Page 15 
 
 
  15. Does India intend to keep the 2007/08 applied rates as they are without changes during that 
period?  
 
WTO Secretariat's Report, page 38 , para. 22 
 India has only bound 75% of its tariffs in the WTO. 
 
16. Does India intend to achieve 100% binding of its tariffs in the WTO? 
 
(vi) Other charges affecting imports 
 
WTO Secretariat's Report, page 44 , para. 34  
India levies additional duties in  lieu of domestic taxes. 
 
17. What is the rational behind that and why can imports not be taxed in the same way as 
domestic products? What domestic taxes exactly are recalculated into additional duties for 
importers?  
 
In addition to tariffs India impos es several other taxes on imports. India's tariff structure and duty 
calculation still remains quite complex and not easy to follow. The calculation of the full importing 
cost is essential for importers making appropria te decisions when trading. The EC welcomes a 
recently launched single information point for textiles, which provides important information 
regarding tariffs, rates and fees applied for textiles.   
18. Could India indicate whether this initiativ e will be expanded to other sectors?  
 
19. Is there already any single information point where all tariffs, rates, fees, at national and 
regional levels are set out? Are there any other measures taken or being prepared to address 
this complex system?  
 
India's very high import levies on beer represent an im portant barrier to trade. For beer containing 
alcohol as well as for mixed beverages including be er containing alcohol, to tal charges on imports 
amount to more than 300% of the import value. However, India bound its tariffs on beer at 150% during the Uruguay Round. As is the case for win es and spirits, India's import levies on beer are 
apparently not consistent with India's WTO obligations.   
20. Could India provide some comments on this situation and also explain what measures are 
envisaged to end the apparently WTO-inc onsistent treatment of imports of beer? 
 
(ix) Import prohibitions, restrictions, and licensing 
India's report, page 15, para. 58 
India's report notes that the only remaining quanti tative restrictions are those necessitated under 
Article XX and XXI of GATT. However, the EC understands that there are still some licensing 
restrictions for products such as marble, printing paper and stone. 
21. Could India explain the justification for these restrictions and comment on their future 
liberalisation?  WT/TPR/M/182/Add.1 
Page 16  
 
  WTO Secretariat's Report, page 47, para. 39-40 
We would be interested in further information on India's licensing regime. 
22. Could India explain which restricted imports are subject to licensing and how fees for 
licences are calculated? 
Machines older than 10 years are ex cluded from the general import regime regardless of their actual 
state, type and their previous and intended user s. India's licensing system demands a so-called 
"product machine life expectation certificate", which cannot in practice be given by the manufacturer or the trader. Therefore, the measure could lead to total abolition of imports. 
23. Will India amend its import licensing system for trade of second-hand machinery?  
(x) Contingency measures 
WTO Secretariat's Report, page 47, para. 50 
 
According to the Report, India has imposed final safeguard measures on only one case (Epichlorohydrin).  However, the EC notes another case (Tapioca Starch) against which a safeguard 
duty is in place.  The safeguard duty was impo sed through Customs Notification 40/2005-Customs 
dated 2nd May 2005.  The duty is in force until 1 May 2008.   
 
24. Could India clarify this issue? 
 
(xi) Standards and other technical requirement  
WTO Secretariat's Report, pages 52-53, para. 48-55  
25. What is the legal basis, process and institutiona l structure for developing  technical regulations 
(Ministries in charge; role of sub-federal entities)? 
 
26. What is the relation between sta ndards and technical regulations ? 
 The EC considers the list of products subject to mandatory conformity assessment to be discriminatory against imported goods.  
27. Could India clarify its choice of products s ubject to mandatory conformity assessment and 
indicate if products meeting international standards are accepted? 
 
WTO Secretariat's Report, page 52, para. 52  
28. Regarding setting standards or formulating legisl ation, could India explain its framework for 
stakeholders' consultations, including importe rs and non-domestic companies established in 
India?  
 
WTO Secretariat's Report, page 52, para. 53 
 
The Report of the Secretariat states that there are currently around 18300 standards in India. 4307 (23.6%) of these are harmonized with ISO/IEC standard s. According to the data of the previous TPR 
(2002), as of April 2001, 17% of Indian standards we re harmonized with ISO/IEC standards. Over 6 
years there has only been a 6.3% increase in the number of harmonized standards.  
  WT/TPR/M/182/Add.1 
 Page 17 
 
 
  29. Is there any particular policy aimed at increasing the number of Indian standards harmonized 
with ISO/IEC ones?  
 
WTO Secretariat's Report, page 52, para. 54  
30. Could India please elaborate on the criteria used by the Bureau of India Standards (BIS) when 
assessing awards of the ECO-MARK to environmentally friendly products? Does the BIS endorse private environmental standards whic h are 'equivalent' with its own award? 
 The Report states that certification has b een made mandatory for 66 products.  
 
31. Could India provide a list of the 66 products that  require mandatory certification and give the 
most up-to-date figure? Has this figure increased  or decreased in comparison to last year? 
What is the estimate for the next year?  
 
32. Could India confirm whether certification is compulsory for 66 products out of 18,300 
standards? (Is it to be understood that out  of 18,300 standards 66 need mandatory 
certification? Please explain.) 
 60 licences of production facilities have been granted by BIS in 15 countries.   
33. Are any of these facilities located in the EC?  
 
34. Does the renewal of licences also require factory visits by BIS?  
 
The EC understands that India's new (voluntary) standard on tyres differs from the international tyre standard (UN-ECE Regulation).  
 
35. Can India indicate whether it is considering harm onising its standard with that of the UN-
ECE and confirm that its national standard w ill not be made mandatory until fully aligned 
with the UN-ECE Regulation and that it woul d accept the "E" mark as proof of conformity? 
(The "E" mark is accepted in over 40 countries.) 
 
36. Has India made an analysis on the impact on imports by having a standard that is different to 
an international standard?  
 The EC is further interested in India's homologation rules for cars. 
37. Would India be ready to sign the UN-ECE 1958 Agreement for reciprocal certificates for the 
import of vehicles and their components? 
38. Could India provide information on its capacity to test for exhaustive emission requirements? 
(xii) Sanitary and phy tosanitary measures 
WTO Secretariat's Report, page 54, para.57 
 
39. Could India inform when the Food Safety a nd Standards Act of 2006 and its implementing 
instruments will come into force and explain wh at differences will be introduced to both 
standards and procedures as a result of the new Act? 
 
40. Could India confirm that the basis of its anim al and plant health and food safety standards 
will be those set down in the OIE, IPPC and Codex alimentarius? WT/TPR/M/182/Add.1 
Page 18  
 
  The EC notes that India has prohibited the importation of a wide range of animal products apparently 
to protect from the risk of introduction of avian influenza. The EC notes that these go considerably 
beyond the recommendations of OIE, and also would like to inform India that most EC Member 
States are free from this disease.  
41. Could India provide full details of the sci entific justification for its measures? 
WTO Secretariat's Report, page 55, para.61 
42. Does India plan to accelerate its notification process to the SPS Committee so as to comply 
with its outstanding notification obligations?  
(xiii) Labelling 
 
WTO Secretariat's Report, page 56, para. 64-65  
There is no express  mention in the Report to the Standards of Weights and Measures (Package 
Commodities) Rules that require all packaged prod ucts to carry, among othe rs, Maximum Retail Sales 
Price - including all taxes, freight, transport charges, commission payable to dealers, and all other charges including for advertising, delivery, and packing. For imported products India requires that 
they are labelled with the Maximum Retail Price (MRP) in the country of origin, prior to customs 
clearance.  This is not feasible as calculations are based on several factors including freight, insurance 
and internal taxes.  The costs va ry from state to state, which means that the calculation of the MRP 
before customs clearance is extremely difficult.   
43. Is India considering any measures to address this issue and if not, why not? 
 
(xiv) Government Procurement 
WTO Secretariat's Report, page 57, para. 68 
 
44. Do the rules of the General Financial Rules (GFR s) also apply to public-private partnerships? 
 
WTO Secretariat's Report, page 57, para. 69 
 
45. Does the term "open tender" under the GFRs, as revised in 2005, mean that not only domestic 
but also foreign suppliers are eligible to pa rticipate in a tender? What is the difference 
between "open tenders" and "global tenders"? 
 
46. Which criteria are used when determining that it is not in the public interest to procure goods 
through open tender, and thus to use limited te ndering. Who takes such a decision, and can it 
be appealed before an i ndependent review body?  
 
47. Who evaluates, and on what basis, whether "t he possibility of additional suppliers being 
tapped is deemed to be remote"? 
 
WTO Secretariat's Report, page 57, para. 70 
 
The Report states that "in principle, there is no preference for domestic as opposed to imported goods" 
for procurements under rate contracts by the Direct orate-General of Supplies and Disposals (DGS&D) 
in the Department of Commerce.   WT/TPR/M/182/Add.1 
 Page 19 
 
 
  48. Does this mean that in certain  instances there are, howeve r, preferences for domestic goods? 
If so, which are these instances? 
 
49. Could India explain what it means that produc ts purchased by the DGS&D "must be 'suitable 
for use' in India"? 
 
WTO Secretariat's Report, page 58, para. 71 
 
50. Is the use of international technical standards, where these exist, mandatory? 
 
51.  Which registration requirements do suppliers have to comply with in order to be eligible for 
tendering with the DGS&D? Does the DGS&D recognize as equivalent a supplier's technical expertise based on activities pursued outsid e India? How many non-Indian suppliers have 
successfully registered with the DGS&D? Is registration with the DGS&D a pre-requisite for registering with other procuring entities?  
 
WTO Secretariat's Report, page 58, para. 72 and 75 
 
52. Which requirements do suppliers have to comply with  in order to be eligible to participate in 
electronic tendering?  
 
WTO Secretariat's Report, page 58, para. 73 
 
53. Can India confirm that under the current law, all purchasing preferences for central public 
sector enterprises will automatica lly expire by 31 March 2008?  
 
54. Which are the award criteria employed by India? 
 
WTO Secretariat's Report, page 58, para. 74 
 
55. What is the level of "earnest money" (deposits ) which tenderers have to  pay, and how are the 
relevant amounts calculated?  
 
WTO Secretariat's Report, page 59, para. 76 
 
56. Which rules apply to public purchasing by entiti es in the utilities, such as for the generation 
and distribution of electricity, gas, oil and water, as well as in the transport sectors? 
 
(3) M
EASURES DIRECTLY AFFECTING EXPORTS  
(iii) Export taxes WTO Secretariat's Report, page 61, para. 85 
 
While noting that leather has been removed from th e reserved items list for SMEs, the EC wishes to 
stress the very high level of export duties maintained  by India on exports of hides and skins (10% to 
25% of the f.o.b. value of the product).  This practice is very deleterious to the leather sector and to its 
competitiveness while not being particularly help ful to the country maintaining such duties. 
 
57. Could India explain its plans and time line for the dismantling of the export duties in this 
sector? 
 WT/TPR/M/182/Add.1 
Page 20  
 
  The EC would like to draw the attention to the re cent introduction by India of an export tax on iron 
ore (Rs 300 per tonne). Although th is measure has been in place for only few months, it has already 
seriously disturbed global trade of this commodity .  In light of  the latest press reports, the EC 
understands that India is considering to  review the export tax on iron ore. 
 
58. Could India explain its plans regarding the e xport tax on iron ore? Is India considering the 
removal of this measure? 
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
(ii) Taxation and non-tax assistance WTO Secretariat's Report, page 74, para. 119-121 
 India’s tax regime is complex and burdensome for traders. 
 
59. Are there any measures taken or being prepared to address this issue? 
 
The recently announced annual supplement to th e Foreign Trade Policy included a service tax 
exemption to exports. However, there seems to be  uncertainty regarding the beneficiaries of the 
measure in question as it is not clear whether the measure will apply to both goods and services.  
 
60. Could India clarify this issue?  
 
(v) Intellectual Property Rights 
WTO Secretariat's Report, page 84, para. 153 
 
According to the statistics of the Federation of I ndian Chambers of Commerce and Industry, fake 
medicines are estimated to occupy between 15% to  20% of the total Indian market; 60% of motion 
picture and 40% of music industry’s production ends being copied and distributed illegally in India, 
one in three automotive parts are copied, 10% of major soft drinks are fake and 10%-30% of cosmetics, toiletries and packaged food are counterfeited.    
61. What measures is the government taking to address this issue?   
 
The EC has been following the public debate in India about the implementation of the 2005 Revised 
Patent Act, in particular the definition and application of patentability criteria.  
62. Could the Indian authorities elaborate on the po licy issues at stake and their proposed course 
of action?  
The Patent Act as revised in 2005 provides both fo r pre-grant and post-grant opposition in the Patent 
Office.  
63. Can India indicate which measures have been taken to prevent abusive use of pre-grant 
opposition to delay or even prevent the granting of a patent? 
64. For example, does India envisage introducing me asures that would ensure that the patent 
application enjoys preliminary patent prot ection until the granting of the patent?   WT/TPR/M/182/Add.1 
 Page 21 
 
 
  According to Article 39(3) of the TRIPS Agreemen t, WTO Members shall ensure protection against 
unfair use of clinical test data submitted to pub lic authorities for the purpose of obtaining marketing 
authorisation of pharmaceuticals.  
65. Can India indicate which measures have been taken to comply with this obligation?  
India's Report, page 30, para. 148  
 
The report states that the enforcement of IPR law is  the concern of State Governments and that the 
Central Government has set up an Inter-Ministeri al Coordination Committee on Intellectual Property 
Rights Enforcement Issues to have a focused approach. 
66. Could India provide more information about th e operation and work of this Coordination 
Committee?  Furthermore, what data is availa ble on the enforcement of IPR across the States? 
 
(vii) Competition policy 
WTO Secretariat's Report, page  95, para. 198 
 
67. Could an update be provided on the state of play of the Competition Amendment Bill 2006? 
 
IV.  TRADE  POLICIES   BY SECTOR 
 
(2) A GRICULTURE  
 India's Report, page 13, para. 50  
The EC notes a proposed amendment to the E ssential Commodities Act to remove existing 
restrictions on trade of agricultural commodities within the country.  
 
68. What are the current restrictions to the free movement of agricultural goods in India? What 
policies would the amendment propose to tackle them? 
 
WTO Secretariat's Report, page 104, para. 19-21 
 
Paragraph 19 describes tariff rate quotas India has ope ned for agricultural products and Table AIIL2 
specifies the volume and in-quota/out-quota tariff rates. Paragraph 19 also lays down: " Quotas are 
generally not issued because, according to th e authorities, there is no demand from importers ."  
 
69. Could India specify what is the fill rate of those TRQs and how the TRQs are being 
administered? Could India explain the possible reasons why the TRQs are underfilled? 
 Paragraph 21 refers to the promotion of expor t of agricultural products ands states that " the incentive 
is an import duty credit equivalent to 5% of the f.o. b. value of exports in the previous year beginning 
1 April 2004 ." This concept remains unclear. 
 
70. Could India provide some more details on how exactly this support scheme is implemented? 
What is the amount paid for the promotion of export under this scheme? Are export credits granted to agricultural exports or are exports subs idised by an amount equivalent to 5% of the 
f.o.b. value of exports?  
 WT/TPR/M/182/Add.1 
Page 22  
 
  (4) M
ANUFACTURING  
 WTO Secretariat's Report, page 119, para. 61 
 
The Indian authorities have declared the enhancem ent of the share of manufacturing in GDP as well 
as ambitions export targets for the coming two years ($160 billion and $200 billion for 2007/2008 and 
2008/2009 respectively) as two of its most important economic policy objectives.  
 
71. What measures are the Indian authorities pla nning to take to achieve those goals? In 
particular, would any of type of subsidies be provided to Indian companies? If yes, are these 
subsidies provided contingent upon exportation? 
 
(5) S
ERVICES  
 (i) Overview 
 
WTO Secretariat's Report, page 126, para. 90 
 
72. Could the Indian authorities explain the policy reasons behind recent proposals to place a 
49% FDI cap on courier services against the existing 100%?  
 
73. Could India inform about the legislation app licable to outsourcing services and the measures 
the government is taking to ensure non-di scrimination of foreign service suppliers? 
 
Distribution sector 
 
74. Could India indicate how many people work in the distribution sector and what has been the 
evolution in the last years? 
 
75. Could India explain how much of the FDI attracted  by the country in the last years has been 
in the distribution sector? 
 
76. Could India inform about the existing legi slation applicable to retailing services? 
 
Tourism  
 
77. Could India inform on how much of the FDI attracted by the country in the last years has 
been in the tourism sector? 
 
78. Could India inform about existing plans to promote the tourism sector, and what measures the 
government is taking to ensure effective non- discrimination of foreign service suppliers? 
 
79. Could India inform about plans for improving professional education and training related to 
the tourism sector? 
 
80. What is India's assessment of the effect of the tourism sector in overall economic growth and 
employment, and in particular in other ec onomic sectors like construction, transport, 
computer services, education and professional training?  
 
81. Could India inform about the existing legislati on applicable to tour managers (professionals 
accompanying groups of tourists in their trav el through the country) and tourist guides?  
  WT/TPR/M/182/Add.1 
 Page 23 
 
 
  82. Could India explain the plans that the government is considering to reduce or eliminate 
discrimination of foreign service suppliers in these fields? 
 
(iii) Financial Services 
 
WTO Secretariat's Report, page 129, para.98  
In spite of the guidelines issued by the Reserve Bank of India, the exact position the RBI will be 
taking regarding entry of foreign ba nks from 1April 2009 is not clear.  
 
83. Is there a possibility of further postponement in  allowing greater market access to foreign 
banks in India following a review by the Reserve Bank of India during 2009? 
 
WTO Secretariat's Report, page 129, para.99 
 
84. Could India please confirm that the bill amending the banking act will abolish the 10% cap on 
voting rights, as indicated by the Secretariat re port? Regarding the same bill, could India also 
explain whether the prior approval requirement for 5% or more of shares or voting rights in a 
bank is exclusively a prudential measure? 
 The WTO Secretariat's Report states that, so fa r, no foreign bank has set up a wholly-owned 
subsidiary in India.  
 
85. When did India issue implementing rules for the setting-up of wholly-owned subsidiaries? 
 
WTO Secretariat's Report, page 131, para.105 
 
Despite strong indication from certain members of the government to raise the FDI cap on insurance 
from 26% to 49%, the proposed bill on this issue is being delayed.  
 
86. What would be the timeframe to give effect  to this legislation bringing about higher 
participation of foreign players in India’s insurance sector?   
 
87. Has India abolished the controls on insurance tariff rates, something that according to the 
Secretariat report was foreseen for January 2007? 
 
(iv) Telecommunications 
 
WTO Secretariat's Report, page 131, para.115-116  
88. Which are the procedures for allocating frequencies for the provision of satellite services and 
especially in the Ku-band?  
 
89. Are foreign satellite operators free to contract directly with telecomm unications operators? Is 
the provision of VSAT services liberalised? 
 
90. Is it correct that the recommendations issued by TRAI related to the provision of satellite 
services need the prior approval of both the Department of Telecom and the Department of 
Space?  
 
91. Would India consider that having ISRO operati ng the domestic satellite system and being part 
of the DOS while the DOS participating in the approval of the recommendations by TRAI WT/TPR/M/182/Add.1 
Page 24  
 
  that all necessary guarantees are provided for th e effective separation between regulatory and 
operational functions? 
 
92. Does India provide for free market entry for the provision of mobile satellite services? 
 
93. Could India provide an update on the requirements  for the installation of a satellite gateway in 
the country? 
 
(v) Transport 
 
WTO Secretariat's Report, page 140, para 142-143  
 
Policy guidelines favouring the award of dredging contracts in major ports to the public sector, 
Dredging Corporation of India, restrict competition in this rapidly growing area. 
94. What steps can be expected in future  to revoke such preferential treatment? 
 
95. Could India indicate as to whether it intend s to abolish its remaining cargo sharing 
arrangements?  
 
96. Could India indicate whether it intends to re view its cargo reservation arrangements which 
reserve 40% of cargo carried to Indian flagged vessels? 
 
97. Could India indicate whether it intends to review the granting of the right of first refusal to 
Indian flagged vessels concerning the carriage of cargo? 
 
98. Could India indicate which cargos are considered government cargos? 
 
WTO Secretariat's Report, page 142, para 151. 
 
Persistent public debate and str ong indications from the Civil Aviation Minister suggest that the FDI 
cap in specific segments of air transport like air cargo carriers, helicopter and non-scheduled operations will be raised from the existing 49%.  
 
99. When is this expected to happen? 
 
According to a Press Release (dated 1 February 2007 ) by the Ministry of Civil Aviation, a new policy 
- to be accompanied by legislation - has been endorsed.  
 
100. Could India provide full details of its legi slative initiative concerning the ground handling 
market at airports? 
 Three types of handling arrangements are indicated as  permissible. Self-handling is not mentioned as 
an option. 
 
101. Could India explain whether the objective of the legislation is to deny air carriers the right to 
self-handle their ground handling arrangements? 
 
102. Could India clarify whether there is a limit on the number of ground handlers that can be 
selected on the basis of competitive bidding? If so, please explain the reasoning for such a 
limit, if other than due to space constraints on the airport premises. 
  WT/TPR/M/182/Add.1 
 Page 25 
 
 
  Indications from the press this year suggest th at the government is developing guidelines on the 
management of airports by private companies.   
103. Could India confirm this initiativ e and, if so, provide details? 
 
(vi) Professional Services 
 WTO Secretariat's Report, page 147, para 170  
 
The Advocates Act of 1961 provides in its Article 47  (2) titled "reciprocity" that the Bar Council of 
India can prescribe the conditions subject to which foreign qualifications in law obtained by persons 
other than citizens of India shall be recognised for the purpose of admission as an advocate under the 
Advocates Act.  
104. Could India explain what conditions the Bar Council of India has developed to allow for 
recognition of foreign qualifications as descr ibed in Article 47 of the Advocates Act? 
Furthermore, are the conditions prescribed by th e Bar Council, if any, publicly available? 
 
105. Could India explain how many foreign qualificati ons of persons that are not citizens of India 
have been recognised under the Advocates Act? 
 WTO Secretariat's Report, page 147, para 171  
 
Massive overseas operations by Indian companies, numerous leading global firms doing business in 
India and the huge potential of outsourcing legal services to India, demand efficient world class legal services and compliance to international legal practices.  
 
In this context, what are India's plan s for opening up the legal services sector? 
 
ADDITIONAL COMMENTS AND QUESTIONS
 
 
I.  ECONOMIC ENVIRONMENT 
(iii) Structural reform 
 
(d) Financial sector and capital market reform   WTO Secretariat's Report, page 13, para. 28 
1. Could India provide information on its plans a nd timetable for renewing its capital markets?  
2. Could India elaborate on whether measures have already been identified and are planned as 
part of this reform? 
II.
  TRADE  POLICY  REGIME:  FRAMEWORK  AND  OBJECTIVES 
(2) T RADE POLICY OBJECTIVES  
 WTO Secretariat's Report, page 22-23, para. 13, 15 
India's Foreign Trade Policy acknowledges the impo rtance of facilitating imports and calls for a 
simplification of import procedures and a reduction of import barriers, as well as coherence and 
coexistence between trade and other economic policies. WT/TPR/M/182/Add.1 
Page 26  
 
  3. Could India indicate whether specific measures in  this regard have already been identified?  
4. If yes, could India list the planned measur es and provide a timetable for these reforms?  
IV.  TRADE POLICIES  BY SECTOR 
 
(5) S
ERVICES  
 (iii) Financial services 
 
(a) Banking  WTO Secretariat's Report, page 127ff, para. 93ff 
 
It is a requirement of the Reserve Bank of India th at bank guarantees must be issued and/or confirmed 
through the Indian banks even when these guara ntees originate from first class foreign banks. 
 
Does India intend to re-evaluate this requirement? 
  
PREGUNTAS DE MÉXICO
 
 Se solicita a la India responder a las siguientes pr eguntas formuladas con base en lo señalado en el 
documento WT/TPR/S/182  del 18 de abril de 2007: 
 IV. POLÍTICAS COMERCIALES, POR SECTORES / 5)  Servicios / iii) Servicios Financieros 
 
1. En el párrafo 92 se menciona que se han atenuado las restricciones aplicadas a los bancos 
extranjeros. México quisiera una explicación más detallada respecto a qué tipo de medidas se 
han implementado para permitir  una mayor participación de la banca extranjera.  
 2. En el párrafo 94 se señala que el sector bancar io está dominado por bancos del sector público, 
los cuales representan el 72 por ciento de los ac tivos totales del sector. México está interesado 
en conocer si existen planes o estrategias gube rnamentales tendientes a fomentar una mayor 
participación del capital privado nacional y/ o extranjero en el sistema bancario. 
 IV. POLÍTICAS COMERCIALES, POR SECTORES / 5)  Servicios / iii) Servicios Financieros / 
b) Seguros 
 
3. En el párrafo 106 se señala que la competencia en el sector de seguros está limitada por los 
relativamente elevados obstáculos a la entrada.  México está interesado en conocer cuáles son 
estos obstáculos y cuál es su marco normativo, así como si existe algún proyecto gubernamental para permitir una mayor par ticipación de aseguradoras en el mercado.  
 
IV. POLÍTICAS COMERCIALES, POR SECTORES / 5) Servicios / iv) Telecomunicaciones. 
 
4. En el párrafo 116 se destaca que los servicios de telefonía fija siguen dominados por 
proveedores del sector público. México quisiera conocer si el Gobierno de la India planea permitir una mayor participación de proveedores privados y/o extranjeros para la prestación 
de este tipo de servicio.  
 5. En el párrafo 122 se menciona que la Ad ministración de Reglamentación de las 
Telecomunicaciones reglamenta las tarifas de los servicios en aquellos mercados que no son  WT/TPR/M/182/Add.1 
 Page 27 
 
 
  competitivos. México quisiera saber cuáles son los criterios que sigue esta Administración 
para determinar que un mercado es o no competitivo. 
 
IV. POLÍTICAS COMERCIALES, POR SECTORES / 5) Servicios / v) Transporte / a) 
Transporte por carretera y ferrocarril. 
 
6. En el párrafo 130 se menciona que el Gobierno tiene el propósito de sustituir la Ley de 
Transportistas de 1865 por el Proyecto de ley de transporte por carretera de 2005. México está 
interesado en conocer cuándo se dará de manera formal este cambio y qué ventajas tiene para 
el sector del autotransporte. 
 
7. México quisiera saber si se permite la participación del capital extranjero en el sector de 
autotransporte de carga y pasajeros y, de ser el caso, hasta qué monto de participación se permite. 
 
8. El párrafo 132 señala que se permite la partic ipación de la inversión extranjera en el 
transporte por ferrocarril en actividades tale s como hostelería, construcción y gestión de 
terminales de carga y operaciones de fletes. México quisiera saber si esta participación tiene restricciones o se permite de una manera total. 
 
9. México está interesado en conocer si se pl anean realizar mejoras en los sectores de 
telecomunicaciones, construcción, computación y transporte. 
  
ADVANCE WRITTEN QUESTIONS FROM THE SEPARATE CUSTOMS TERRITORY OF 
TAIWAN, PENGHU, KINMEN AND MATSU (CHINESE TAIPEI)  
 A. Secretariat Report: WT/TPR/S/182
 
I. ECONOMIC ENVIRONMENT 
 (2) R
ECENT ECONOMIC DEVELOPMENTS  
 
(iii) Structural reform 
 (e)  Labour market reform 
 
Question 1:  
(Page 13, paragraph 29)  
 As indicated, among the major problems facing India today are unemployment, underemployment and job creation. More general re form is probably needed as the labour market 
appears to be relatively inflexible. 
  It is widely recognized that India has put more emphasis on the liberalization of Mode 4 in the Doha Round services negotiations. We are interest ed in how India’s labour and manpower policies 
relate to its stance on Mode 4 liberalization. 
 
a) Does India regard the liberalization of Mode 4 as a useful policy instrument to make its 
labour market more flexible? If so, what is the rationale fo r such a policy? 
 WT/TPR/M/182/Add.1 
Page 28  
 
  b) Given the deficit in domestic professional  manpower (Indian Government Report, page 14, 
paragraph 57), could the increased mobility of  skilled workers from abroad also have a 
negative effect on India’s employment policy? If so, how would India tackle this problem? 
 
Question 2:  
(Page 13, paragraph 30) 
 
 The National Common Minimum Programme (N CMP) acknowledges that some changes in 
labour laws may be required.  
Could India please elaborate on the role the NCMP plays in labour market reform? Furthermore, 
what are the key elements of change in th e labour laws acknowledged by the NCMP?  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 
(iv) Role of state-owned enterprises and privatization 
 
Question 3:  (Page 83, paragraph 151 and Box III.2) 
  The recommendations of the Disinvestment Co mmission have focused mainly on minority or 
majority sales to a strategic partner. A foreign company, subject to the government’s sectoral policy 
on FDI, is eligible for consideration. 
Could India please elaborate further on the cond itions under which a foreign company would be 
regarded as a strategic partner?  
 
Question 4:  (Page 83, paragraph 152) 
  On 6 July 2006 the government announced that it had “decided to keep all disinvestment 
decisions and proposals on hold pending further revi ew.” The present government’s policy is not to 
continue privatization. 
 
a) We would appreciate some further explanation of the reasons behind India’s decision to keep 
all disinvestment decisions and proposals on hold. 
 
b) Could India please advise us of the timeline,  if it exists, for completing the reviews of the 
current privatization policy or for resuming the disinvestment practices? 
 
(v) Intellectual property rights 
 
Question 5:  (Page 86, paragraph 159) 
 
 As indicated, in accordance with the Patents Ac t, any person interested in working a patent 
can, after the expiry of three years from the date of grant of the patent, apply for the grant of a 
compulsory licence. Grounds for granting a compulsory licence are also provided in this paragraph.  
a) We are interested in knowing what is Indi a’s rationale for establishing the above-mentioned 
three-year period before a person may apply for a compulsory licence?   WT/TPR/M/182/Add.1 
 Page 29 
 
 
  b)   Could India please explain further what conditions would constitute grounds for claiming 
that “the reasonable requirements of the public  with respect to the patented invention have 
not been satisfied”? 
 
c)   What conditions would c onstitute grounds for deciding that “the patented invention is not 
available at a reasonably affordable price”? Do es this criterion have any anti-competition 
connotations? 
 
Question 6:  
(Page 91, paragraph 184) 
 
 Under the Customs Act, Customs may seize and hold goods “for a reasonable period”, 
including for suspected violations of intellectual property rights. 
 
We would appreciate knowing whether, in cases where pirated goods have been identified, India’s 
Customs Administration is allowed to provide the right- holder concerned with information about the 
exporter, importer and quantity of the ship ment, and, If so, on what legal basis? 
 
IV. TRADE POLICIES BY SECTOR 
 
(2) A GRICULTURE  
 (ii) Agricultural policies 
 
Question 7:  
(Page 107, paragraph 25) 
  As indicated, India last notified its AMS comm itments and its export subsidies to the WTO in 
March 2002 for the period 1996/97-2000/01. The notifica tion is to be updated as  soon as more recent 
data are collected. 
 
Would it be possible for India to inform us as to  when the updated notification will be available? 
 
Question 8:  (Pages 108-109, paragraphs 27 and 28) 
  A Price Support Scheme (PSS) and a Market In tervention Scheme (MIS) have been put in 
place for various crops. Under the PSS, Minimum Support Prices (MSPs) for major field crops are 
announced by the government following the reco mmendations of the Commission for Agricultural 
Costs and Prices (CACP). On the other hand, under th e MIS, the Market Intervention Price (MIP) is 
based on the cost of production. 
 
Could India please elaborate further on how the CACP would make its recommendations on MSPs 
under the PSS? Would the MSP of a crop also be referen ced to the cost of production, as is the case 
with an MSP under the MIS?  
Question 9:  
(Page 109, paragraph 29) 
  It is stated that the Indian Government gr ants price support to paddy (rice) through various 
agencies. An Indian farmer has the option to sell rice  to the government agencies at the MSP or in the 
open market. This procurement policy ensures that  farmers receive remunerative prices for their 
produce. WT/TPR/M/182/Add.1 
Page 30  
 
   We would appreciate knowing whether, apart from the above-mentioned procurement policy, 
there are other price support projects for rice? 
 
(3) E
NERGY  
 
(i) Oil and gas 
 
Question 10:  
(Page 114, paragraphs 40 and 42)  
 
 Foreign investment is restricted to 26% of to tal investment in public sector refineries. Apart 
from that refining sector, up to 100% foreign investment  is allowed in all activities in the oil and gas 
industry, including exploration, production, and marketing.   
a) Could India please inform us of the rational e for differentiating refining from other activities 
in oil and gas sector? 
 b) Does India have a timeline for the relaxation of this restriction on foreign investment? If so, 
details of the anticipated timing would be appreciated. 
Question 11:  
(Page 114, paragraphs 42 and 43) 
 
 It is stated that five private companies have been granted marketing rights for the 
transportation fuel. In addition, measures have been  taken to encourage exploration and production of 
oil and gas. Under the New Exploration Licensi ng Policy (NELP) announced in 1997, 100% foreign 
investment was allowed in all types of exploration.   Could India please to confirm whether:  a) oil production has been covered by the NELP? In other words, whether companies with 100% 
foreign investment would also be allowed to  join in oil and nat ural gas production? 
 b) companies dominated by foreign investment, wh ich have been allowed to join in oil and 
natural gas exploration and production, w ould also be granted marketing rights?  
 c) any of the above-mentioned five private co mpanies have been undertaking all the activities 
mentioned in a) and b) above?  
 
Question 12:  
(Page 115, paragraph 45) 
 
 It is stated that prices of kerosene and liquid petroleum gas (LPG) remain subject to government control. The government also continu es to monitor the prices of kerosene, LPG, motor 
spirit and diesel, in the interests of the weaker sections of society.  a) Could India please explain the difference between “price control” and “price monitoring?” 
 b) Would the measure for controlling or monitoring prices of kerosene and LPG be the 
equivalent of establishing minimum import prices on those products? 
 c) Does India have a timeline for the release of th e said price control or monitoring measures? 
If so, details would be appreciated.  WT/TPR/M/182/Add.1 
 Page 31 
 
 
  Question 13 
(Page 116, paragraph 49) 
 
 As indicated, the Indian electricity industry is  regulated by the Central Electricity Regulatory 
Commission (CERC) and the State Electricity Regulatory Commissions (SERCs) at the central and 
State level respectively. The CERC is also in char ge of regulating the tariff of generating companies 
that operate across States, as well as inter-State transmission. 
 
We are interested in knowing whether the CERC w ould have to consult with the SERCs concerned in 
matters involving more than one State? Is there  an established mechanism for the CERC to 
coordinate different views or even settle disputes between States? 
 
(ii) Electricity 
 
Question 14:  
(Pages 116-117, paragraphs 51- 53) 
 
 As indicated, amount of foreign investment attr acted in electricity generation, transmission, 
and distribution is low in India. The low foreign and private investment has to a certain extent 
constrained the growth of the electricity industry,  and even the development of the economy. One of 
the main reasons leading to the said low foreign pa rticipation is that generating companies could not 
choose their customers, and in practice they may have  to sell electricity to State Electricity Boards 
(SEBs). But, with financial difficulties, SEBs have not been able to pay fu lly for the purchase of 
electricity generated by private power producers.    
We are interested in knowing whether India has developed a plan to attract foreign investment more 
effectively in the electricity sector? For examp le, does the government intend to allow private 
generating companies to choose customers of their own free will? Or, what actions might be taken to 
improve the financial structures of SEBs? 
 
(5) S
ERVICES  
 
(iii) Financial services 
 
Question 15:  (Page 130, paragraph 100) 
  As a start-up contribution, the parent bank should provide a minimum of US$ 10 million to its 
offshore banking unit (OBU).    This above-mentioned capital requirement far exceeds the level that applies within our 
territory in similar situations, th erefore we would appreciate knowing: 
 a)  What is the reason for such a high threshold for setting up an OBU?  
b)  Under what conditions would India consider lowering the said threshold? 
 
(iv) Telecommunications 
 
Question 16:  
(Page 134, paragraph 118) 
  It is stated that the Indian Government a llows 100% foreign ownership for Internet service 
providers (ISPs) without gateways, infrastructure pr oviders providing dark fibre, and electronic and WT/TPR/M/182/Add.1 
Page 32  
 
  voice mail services. However, companies providing these services must divest 26% of equity to the 
Indian public in five years, if they are listed outside India.  
a)  Could India please explain the rationale for introducing the aforementioned requirement for 
lowering foreign equity participation? 
 
b) As also indicated in this paragraph, in No vember 2005 foreign investment equity restrictions 
were increased from 49% to 74% in certain area s, such as fixed line,  cellular, unified access 
services and national and international long-dist ance calls services. However, we have noted 
that this autonomous liberalization effort wa s not included in India’s revised services offer 
(TN/S/O/ IND/Rev.1). We would therefore appreciate knowing whether India has the intention 
of binding this autonomous liberalization effort in its second revised offer on services? 
 
(v) Transport 
 
Question 17:  
(Page 147, paragraph 141) 
 The Indian government has introduced a number of policy initiatives to deregu late and to encourage 
public-private participation in ports. For example, fo reign investment restrictions have been relaxed. 
We also note that that operational activities of the port are being increasingly transferred to the private 
sector through contractual agreements (G overnment Report; page  8, paragraph 22). 
 Could India please confirm whether private compani es are allowed to provid e the nine port services 
(pilotage, towing, tug assistance and pushing, port captain services, navigation aids, etc.) listed as additional commitments under the mari time transport services section of India’s revised offer? If so, 
are there limitations on foreign participati on for each of the above-mentioned services? 
 
B.  Government Report: WT/TPR/G/182
 
II. INDIA - FUTURE GROWTH PROSPECTS 
 
(b) Major challenges to growth  (i)  Infrastructure deficit 
 
Question 18:  
(Page 7, paragraph 15) 
  The Electricity Act, 2003, provides that the SERCs shall adopt tariffs through a transparent 
process of bidding. This approach to tariff determin ation is expected to encourage private sector 
investment.  
a) Could India please explain further how the ab ove-mentioned approach to tariff determination 
would encourage private sector investment? 
 b) Given the fact that the amount of foreign investme nt in the electricity industry still seems to be 
low (Secretariat Report; page 7, paragraph 15), could India please please provide details of 
any plans it might have to bridge the gap?    
  WT/TPR/M/182/Add.1 
 Page 33 
 
 
  Question 19:  
(Page 8, paragraph 21) 
 
 As indicated, the Indian government is encouraging the use of hydro and wind energy 
sources.  
 
Could India please provide further details of the me asures that have been taken  to encourage the use 
of hydro and wind energy sources so far?  
Question 20:  
(Page 8, paragraph 22) 
 
 The National Maritime Development Progra mme envisages an invest ment of over US$13.3 
billion for increasing the capacity of ports to bring them up to globally competitive levels. 
We are interested in receiving fu rther details of the National Maritime Development Programme. In 
addition to increasing the capacity, could efforts in other areas also be crucial to making India’s 
ports globally competitive? 
 
(iv) Skill deficit in manpower 
 
Question 21:  (Page 14, paragraph 57) 
 As talent supply shortages are emerging, India will undertake major reform at all levels of education 
aimed at ensuring that the quality and numbers of professionals needed by the country are met. We also note that India is trying to ensure that the IT sector does not face a shortage of quality manpower 
(Government Report; page 21, paragraph 99).   It would be appreciated if India could elaborate on whether any other professionals are on the priority list under India’s manpower policy relating to the knowledge services sector? 
 
V. TRADE FACILITATION 
 
Question 22:  
(Page 17, paragraph 73) 
 As indicated, the Indian government has taken many measures to expedite Customs clearance 
procedures. We have been informed by some of ou r traders, however, that they have experienced 
difficulties in re-exporting their goods as the buye rs in India failed to fulfill their payment 
responsibilities.  
 
Could India please elaborate further on exactly how Customs procedures for returned goods would 
be streamlined?  
 
VI. STRENGTHENING SECTORAL MARKETS 
 
(d) Information technology  Question 23:  (Page 21, paragraph 97)   
 
It is stated that since India is a member of th e Information Technology Agreement (ITA), tariffs on all 
the 217 tariff lines have been eliminated from Ma rch 2005. According to India’s “Customs Tariff WT/TPR/M/182/Add.1 
Page 34  
 
  2006-2007” (www.cbec.gov.in/customs/cst-0607/cst-main. htm), however, it seems that tariff rates on 
certain products covered by the ITA, say, aerials and other parts that fall under HS 8529, have not 
been eliminated.   
Could India please clarify whether all its commitm ents made under the ITA have been completely 
fulfilled?  
(f) Financial sector 
 
(i) Reforms in the foreign direct investment (FDI) regime  
Question 24:  
(Page 23, paragraph 109)  
As indicated in the Report, the foreign exchange regi me of India is now considered to be one of the 
most liberal amongst countries where restrictions on the capital account still exist. On the other hand, 
we have learned from the “Foreign Exchange Manageme nt Act” of India that all foreign investments 
and profits earned are freely repatriable, except those under non-repatriable schemes.  
 
It would therefore be appreciated if India could prov ide us with more detailed information about its 
foreign exchange regulations relating to non-repatriable schemes.   
Such information may include, but not be limited to, the following: 
 a) Whether non-residents could transfer or reduce their investments in India?   b) Whether non-residents could repatriate their ea rnings after a certain number of years of 
investment? 
 
(v) Insurance sector 
 
Question 25:   
(Page 28, paragraph 132) 
  As indicated, the insurance industry in India has witnessed very fast growth over the past five 
years. We understand that micro insurance is a vital vehicle in the provision of insurance cover to the 
poor, thus strengthening the social safety net. We ha ve also learned that ample experience now exists 
in India and remarkable progress has been made in  developing an enabling regulatory framework for 
micro insurance.  
 
It would be appreciated if India could please provide us with further details of its micro insurance 
regulations and practices?  
QUESTIONS FROM AUSTRALIA
 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE  (2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(iii) Tariffs 
 
1.  Australia commends India’s reduction of MF N tariff rates on non-agricultural products since 
the previous Review (WT/TPR/S/182, page 33 para 1).  Does India intend to make similar reductions  WT/TPR/M/182/Add.1 
 Page 35 
 
 
  to tariffs on agricultural products to reduce the leve l of variance between tariffs on agricultural and 
non-agricultural products?  2. We note the complexity in the way in which applied tariffs are determined and the numerous 
exceptions underlying this process (WT/TPR/S/182,  page 38 para 21).  Has India considered 
alternative methods in which dete rminations of applied tariffs are made to increase stability and 
consistency to local businesses?  3. India levies tariffs on most imports on an ad valorem  basis, but tariffs on two products are 
specific duties (WT/TPR/S/182, page 40 para 26).  What is the reason for these exceptions from 
India’s general approach of levying tariffs on an ad  valorem basis?  Has India considered converting 
these non-ad valorem tariffs to ad valorem tariffs?  
(v) Tariff-rate quotas 
 4. We note that India maintains tariff rate quot as (TRQs) on a number of products (milk powder, 
maize, crude sunflower seed and safflower oil and re fined rape, colza and mustard oil), but that there 
have been no requests from designated agencies for rape, colza or mustard oil since 2002/03 and the 
last request for milk powder was in 2003/04.  Australia is concerned that quota licences are 
consequently not being issued for some of these pr oducts, even though the fact that imports of some 
of these products has been occurring, presumably at the out-of-quota rate (WT/TPR/S/182, page 44 
para 33), shows that there is demand. 
 
(a) Can India provide further information on th e ‘designated agencies’ who can request TRQs? 
 (b) Can India explain on what basis these designate d agencies decide whether to request TRQs in 
a given year, including how they assess whether there is demand for the products covered? 
 5. We note that India is yet to submit notifi cations under Article 18.2 of the Agreement on 
Agriculture relating to tariff quota administration (Notification MA:1) and fill rates (Notification 
MA:2). Australia would appreciated India’s advice on when it intends ot make these notifications and provide Members with an opportunity to  review its tariff quota arrangements? 
 
(vii) Duty and tax concessions 
 
6. We understand that Indian Commerce Depart ment officials announced in 2005, 2006 and 
2007 (at the time of the release of the annual Fore ign Trade Policy Supplement) that the Department 
will finalise a 'WTO compliant' alternative to the 'Duty Entitlement Pass Book' scheme (see 
WT/TPR/S/182, page 180, Table AIII.4) for Indian e xporters within a year.  What is the progress on 
finalising the alternative to the DEPB scheme?  
(ix) Import licensing 
 
7. In responses to questions to the WTO Comm ittee on Import Licensing, India has informed the 
Committee that no imports are made into India on th e basis of export permits.  Australia understands 
that India maintains an advance licence (AL) schem e for some products, including sugar.  Australia 
also understands that imports under the AL scheme for sugar are conditional on the export of fixed 
quantities of sugar, in proportion to the quantity imported. 
 
(a) Could India provide a description of the AL sc heme, including the product coverage and any 
special product-specific arrangements, together w ith advice of any subsidies available for the 
exported product? 
 WT/TPR/M/182/Add.1 
Page 36  
 
  (b) Could India provide data on imports – on a product-by-product basis - of imports under the 
AL scheme, together with total imports of those products?  
 (c) Could India provide information on the basis fo r deciding eligibility of  a product under the 
scheme? 
 
(d) Is the grant of a licence under the AL scheme subject  to quantitative limits, either at the level 
of licence holder or within an overall fixed product ceiling?   
 
(xii) Sanitary and phytosanitary measures  
 
8. Australia welcomes India’s decision to consolidate 13 separate laws under a new Food Safety 
and Standards Act  2006 and that a National Food Safety and Standards Authority (‘the Authority’) 
will be established (WT/TPR/S/ 182, page 54, paragraph 57). 
 
(a) Could India provide more details about the exte nt to which imported goods will be regulated 
by the Authority under the new food regulation system? In particular, if any specific requirements and/or enforcement activiti es would apply only to imported goods. 
 (b) Could India indicate when the new regulation system will be in place? 
 
(c) Could India indicate the extent to which requirements under the new food regulation system 
will align with the standards, code of prac tices and other texts adopted by the Codex 
Alimentarius Commission (Codex).  
 9. Australia understands that India was cons idering implementing the issuance of electronic 
import permits across India to ensure consistency and validity of import permits. Can India outline 
what progress has been made regarding utilising electronic systems?  10. We note that India’s imports of livestoc k and meat products are regulated under the Livestock 
Importation Act  1898 and the Meat Food Products Orde r 1973 and require an import permit 
(WT/TPR/S/182, page 55, paragraph 59). Further, India’s Livestock Importation Act Schedule on the 
Procedure for Import of Livestock Products in to India, clause (3)(ii), requires that “ The import risk 
analysis shall be conducted by the concerned officers of the Department on the basis of 
internationally recognised scientific principles of  risk analysis and the analysis shall be conducted 
with reference to the specific product and the disea se situation prevailing in the exporting country vis-
à-vis the disease situation in India ”. 
 
(a) We would appreciate details on India's process for conducting science-based import risk 
assessments to establish quarantine requireme nts for animals and animal products. In 
particular, Australia seeks details of the sci entific risk assessments India has conducted to 
develop the current import conditions for anim als including cattle, sheep, goats and rabbits 
and meat products. 
 
(b) We would appreciate details of how these risk assessments take into account the different 
health status of exporting countries and how th ey are applied consistently when the disease 
status is the same.  
 
11. India's current import requirements for cattle a nd sheep include restrictions for pestiviruses, 
and for sheep there are restrictions for border disease s which are caused by a pestivirus. Pestiviruses 
are considered endemic in most major sheep produc ing countries. Australia would appreciate details 
of India’s health status regarding pestiviru ses and information on any surveillance programs to  WT/TPR/M/182/Add.1 
 Page 37 
 
 
  support claims for country or zone disease freedom, or animal health control programs in place to 
manage the disease.  12. Import Permits issued by India for pig and sh eep meat and meat products require certification 
attesting to freedom from many common animal dise ases that are endemic in both India and Australia. 
Australia seeks India’s advice as to the basis fo r such requirements and any available data to 
demonstrate that the disease agents may be tr ansmitted in the meat of healthy animals. 
13. Import Permits issued by India for pig and poultry meat and meat products require that the 
source animals have never been fed with feeds pr oduced from internal organs, blood meal and tissues 
of ruminant origin (ie. ruminant-derived meat and bone meal). Australia is not aware of any scientific 
information supporting a ban on the feeding of ru minant-derived meat and bone meal to pigs or 
poultry. Can India provide advice as to the basis (e g. scientific risk assessment) including whether it is 
based on OIE guidelines?  14. For more than three years now India has operated a prohibition on the import of dairy 
products made from milk derived from cattle which have had oestrogen treatment within the past 
90 days.  
(a) Australia seeks India's advice as to the basis of  this prohibition and the scientific evidence 
which justifies this requirement. 
 
(b) Can India advise whether oestrogen is permitted as a veterinary medicine in the country?  
o If oestrogen is allowed for u se in India, what measures ar e in place to ensure that 
consumers are not exposed to dairy produc ts made from milk derived from cattle 
which have been treated with oestrogen? How is the milk from cows treated with 
oestrogen disposed of for the 90 days following such treatment? 
o If oestrogen is not allowed to be used in India, does India have a testing program to 
regulate the ban, and if so, how does the testing differentiate between naturally 
occurring oestrogen and exogenous oestrogen?   
 
(xiv) Government procurement 
 
15. In the light of the observations in the Secret ariat’s report on this issue (WT/TPR/S/182, page 
59, para 78), could India advise whether it is giving  any further consideration towards accession to the 
WTO Agreement on Government Procurement.   
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 
(v)  Intellectual Property 
 
16. Since India’s introduction of the disclosure re quirement for patent applications involving 
traditional knowledge /genetic r esources, how many applications have been accepted under this 
provision and what did they covered? 
 
(a) How many applications have been rejected and what did they cover? 
 (b) What is the distribution between do mestic and foreign applicants?  
 
17. Can India provide information regard ing the operation of the Customs Act in 
prohibiting/restricting the import or export of goods that infringe IP rights (WT/TPR/S/182, page 91, 
para 184).  For example, can India provide any statistics on   WT/TPR/M/182/Add.1 
Page 38  
 
  (a) how many cases there have been and in which areas eg. patents, trade marks and copyright? 
 (b) how many cases have involved domestic or foreign individuals/companies? 
 18. Does India plan to accede to the WIPO Internet treaties? 
 
19. What legislative and law enforcement measur es does India have to address civil and criminal 
on-line infringement?  20. Does India have legislation that provides for the collective management of copyright? 
 
IV. TRADE POLICIES BY SECTOR 
 
(2) A
GRICULTURE  
 
(ii) Agricultural policies  
(a) General Framework  21. The Secretariat’s Summary Observations (WT/TPR/S/182 page vii) note that agricultural 
growth in India has remained slow and erratic, despite impressive overall economic performance with 
growth averaging over 8.5% since 2003/04. The low growth in the agricultural sector has occurred 
over a period when government support for the sector has increased substantially. 
 
(a) How does the Indian Government promote structur al adjustment in the agricultural sector to 
allow for improvements in productivity and competitiveness? 
 (b) What policies does India have in place or in pr ospect to address the “crowding out” of public 
investment in R&D and infrastructure by spending on direct and indirect subsidies, which the 
Secretariat’s report (page xi) identifies as a majo r factor in India’s low productivity in the 
agriculture sector? 
 
(c) Export Policy  22. We note (WT/TPR/S/182, page 106, paragra ph 21) that India has established agri-export 
zones to encourage exports of certain products, and these zones receive assi stance from central and 
state governments. Could India please provide further information on the specific measures taken? 
 (d)  Internal policies  23. We note (WT/TPR/S/182, page 108-9) that India provides, inter alia minimum support prices 
for 25 essential commodities, minimum intervention prices for other crops, input subsidies and 
consumer price subsidies  In its notifications  to the WTO Committee on Agriculture, India has 
provided some general information on support provided to the rice, wheat and coarse cereals sectors.  
Australia understands that domestic support is provided to the sugar sector, at both Central and State 
level. India has not recently notified any expor t subsidies to the WTO Committee on Agriculture 
 
(a) Could India provide a description and details of the  support arrangements provided for the 
sugar sector, including the types of measures and expenditure, at both Central and  State 
level? 
  WT/TPR/M/182/Add.1 
 Page 39 
 
 
  (b) Could India provide information on assistance me asure to sugar exporters  at both Central and 
State level?  In particular, could India provide full documentati on on freight and other 
transport subsidies for export shipments of sugar, at both Central and Stare level? 
 Notifications 
 
24. India has notifications pending for domes tic support (marketing years 1998/99 onwards) and 
export subsidies (marketing years 2001/02 onwards).  When does India plan to make these notifications and provide Members with an oppor tunity to review its domestic support and export 
subsidy arrangements for these years? 
 
(5) S
ERVICES  
 
25. In the context of the WTO Secretariat’s Repor t observation that “services have been the main 
engine of growth in recent years…largely due to greater progress in reform in certain services”, could 
India provide the trade policy rationale for not making offers in the WTO General Agreement on 
Trade in Services negotiations which reflect the cu rrent market access and openness in those sectors, 
for example the financial and telecommunications services sectors?   
 
(iii) Financial services  
 
26. On 28 February 2005 the Reserve Bank of India announced a more liberal approach to foreign 
banks entering India.  While foreign bank licensi ng procedures would continue as in the past, the 
number of branches permitted each year would be higher than the existing WTO commitment of 12 branches in a year and that a more liberal policy for under-banked areas of India would be 
followed. 
(a) What is the current quota on the annual numbe r of foreign bank branches approved?  Are 
foreign bank automatic teller machines included in  this quota?   How is an under-banked area 
in India defined?  What obligations are placed  on foreign banks seeking to establish branch 
networks in India, pa rticularly in relation to under-banked areas? 
 
(iv) Telecommunications   
27. When is the Telecom Regulatory Authority of India likely to release the recommendations of 
its review of Internet services, initiated in 2006? Will these recommendations assist in clarifying the 
status of pending Internet service provider licence applications? 
 
28. What is the Indian Department of Telecomm unications’ policy in respect of keeping licence 
applicants informed of progress w ith their applications, delays aff ecting processing, or the reasons for 
decisions? Is this policy inscribed in law?  29. Has India implemented all or parts of the International Telecommunication Regulations (ITR-
88) in domestic legislation? If so, through which pieces of legislation have they been implemented 
and where can these be obtained?  30. The Telecommunications Reference Paper requi res telecommunications interconnection to be 
provided at “cost-oriented rates that are transparen t, reasonable, having regard to economic feasibility, 
and sufficiently unbundled so that the supplier need  not pay for network components or facilities that 
it does not require for the service to be provided.” Does the price of international interconnection in 
India include elements not related to in terconnection costs? If so, please detail these. 
 WT/TPR/M/182/Add.1 
Page 40  
 
  31. To what types of telecommunications en terprise does India apply foreign ownership 
limitations? Does India have a short term or long term strategy to reduce or eliminate foreign 
ownership limitations in th e telecommunications sector? 
 
Mining 
 32. India is increasingly looking to improve the performance of its mining sector but the sector 
continues to be burdened with complex regulations  that increase the transaction costs of mining 
companies, encourages corruption.  Specific detrim ents include 77 agency approvals required to 
obtain a mineral licence, absence of provisions for au tomatic conversion of an exploration permit to a 
mining lease, and the Mines Minister’s power to revoke a mining lease without any explanation.  
Does India intend to address these issues and impl ement the Hoda Committee report reviewing the 
National Mineral Policy of India?   QUESTIONS FROM JAPAN
 
 
The Government Report (WT/TPR/G/182) 
 
VI. STRENGTHENING SECTORAL MARKETS  
(e) Telecommunications 
 (Question 1: page 22, paragraph 103) 
Please clarify whether the Indian authority has a domestic regulation on a fee of private leased circuits 
and imposes on a dominant carrier the obligation to offer private leased circuits. If yes, please explain those regulations, in particular the regulations  on the leasing fee, interconnection rules and the 
obligation to offer private leased circuits. 
 
(Question 2: page 23, paragraph 107) 
According to the Government report, Internet te lephony services were opened to the private sector in 
April 2002 and there are 385 Internet service provide rs and 125 Internet telephony service providers 
at present. 
(1) Please indicate whether a dominant carrier ex ists in the internet telephony services sector. 
 
(2) In the domestic regulations of India, ISP is categorized into two types: ISP with gateway and 
ISP without gateway. The limitation of foreign capit al participation on an ISP with gateway is 74%, 
while the limitation of foreign capital partic ipation on an ISP without gateway is 100%.  
 
Please specify how and where this regulation is described in the schedule of the GATS commitment 
and revised offer from India. Please provide the current  situation where foreign capital enters into the 
Indian ISP market.  
(3) Although the Internet telephony services were opened to the private sector in April 2002, 
opened sectors are limited only in such areas as ‘computer to computer’, ‘SIP to SIP’ and ‘computer 
to out side India’.  
 Please indicate any plan to review this regulation a nd allow the private sector to provide all Internet 
telephony services including ‘SIP to fixed ne twork’ and ‘computer to fixed network’. 
  WT/TPR/M/182/Add.1 
 Page 41 
 
 
  VIII. INDIA AND THE WTO 
 (a) Intellectual Property Rights 
 
(Question 3: page 30, paragraph 146) 
According to the Government report, “The Cust oms Act empowers the Central Government to 
prohibit or restrict import or export of goods in or der to protect trademarks, copyrights and patents.” 
 
(1) As for the protection of "Trademark", please clarify whether the protection is limited to the 
trademark registered under the Trademark Law, or whether the Central Government can prohibit or 
restrict import or export of goods to protect an unr egistered trademark and indications other than the 
registered trademark. 
 (2) If the latter is the case, please clarify a sp ecial requirement to protect an unregistered 
trademark and indications other than the registered trademark.  
The Secretariat Report (WT/TPR/S/182) 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 (2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(Question 4: page 33, 38, 41, paragraph 1, 2, 23, 28) 
While India’s average applied rate on non-agricultu ral products in 2006/2007 is 12.1% as a result of 
the tariff reductions, the average bound rate for non-ag ricultural products is 34.7%. In addition to the 
discrepancy between the applied and bound rates, low binding coverage for non-agricultural products 
(71.6%) is not predictable. In te rms of predictability, it is favorable to reduce as much as possible the 
discrepancy between the applied and bound rates, as well as to increase the coverage.  
The Secretariat report states that the tariff on non-ag ricultural products has been cut to meet India’s 
goal of achieving ASEAN levels of tariff prot ection for non-agricultural products by 2009.  
 
Japan would like to know what ‘ASEAN levels’ me an, as well as the tariff reduction schedule in the 
hereafter.  (Question 5: page 34, paragraph 8) 
Imposing central sales tax merely on the transporta tion of goods from one state to another could 
hamper the free business environment in India.  
 
Please explain the rationale for and the purpose of this tax.  (ii) Customs valuation and clearance  (Question 6: page 36, paragraph 16) 
(1) The Secretariat report touches upon the amendm ent of Rule 9(2) of the Customs Valuation 
Rules 1988. 
Please provide specific information on how the Rule 9(2) of the Customs Valuation Rules 1988 was 
changed. 
(2) Please clarify whether the landing fee, which is about 1 per cent of the Cost, Insurance and 
Freight (CIF) value, is included in the tax base of the customs tariff in India. 
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  (vi) Other charges affecting imports 
 (Question 7: page 44, paragraph 34) 
 
(a) Tariff structure 
 (1) Please confirm that it is right to understand th at the countervailing duty, which consists of the 
additional duty and the special additional duty, and the educati on-cess would be levied on imported 
articles in addition to the basic custom tariff. Is th ere any other duty on imported articles in addition to 
them? Please provide information on duties which have already been eliminated among those duties. 
 (2) Please provide detailed information on those duties, such as the countervailing duty (the 
additional duty and the special additional duty) an d the education-cess, and especially information on 
the background, objective, legal basis, governing au thority and procedures relevant to those duties 
respectively.  
 
(3) Please confirm that it is right to understand that  all duties, other than the basic custom tariff 
and the countervailing duty, are categorized as th e internal taxes in India. If some duties are 
categorized as customs tariffs, please specify these duties.  
(b) Additional Duty 
 
(1) Please clarify what kind of imported articles are subject to the additional duty.  
(2) The Secretariat report states the additio nal duty is in lieu of the excise duty. 
 
Please clarify whether the difference in the tax rat es between the additional duty and the excise duty 
exists. If the rates are different, please indicate the respective rates of the additional duty which are 
applied to imported goods. 
 
(3) Please confirm that it is right to understand th at the tax base of the additional duty is the total 
amount of accessible value of imported goods and its basic customs duty. 
 
(4) Regarding the imports of raw materials a nd intermediate goods, w ould the additional duty 
imposed on them be eligible for tax refund when they are used as inputs in the production of a finished product which is subject to the excise duty? Please clarify whether both cases exist in which 
the additional duty would be eligible for tax refund  and not eligible for tax refund. If yes, please 
provide information in which cases th e tax refund would be available. 
 
(5) Please provide India’s view on the consistenc y of additional duty with the WTO agreement, 
especially in terms of paragraph 1 of Article II and paragraph 2 of Article III of the GATT 1947. 
 
(6) Please clarify what kind of imported goods are subject to the special excise duty. 
 (7) Please provide information on the rate of the special excise duty. If the rate varies according 
to imported goods, please indicate the respective rates which are applied to imported goods. 
 
(8) Please indicate the tax base of the special excise duty. 
 
(c) Special Additional Duty 
 
(1) Please clarify what kind of imported goods are subject to the special additional duty.  WT/TPR/M/182/Add.1 
 Page 43 
 
 
  (2) Japan understands that the rate of the speci al additional duty is 4%. If this rate varies 
according to imported goods, please indicate the resp ective rates which are applied to respective 
imported goods.  (3)  If the special additional duty  is categorized as an internal duty rather than a customs duty, 
please specify what kind of internal tax is supposed  to be countervailed by the special additional duty. 
 
(4) Please confirm that it is right to understand th at the tax base of the special additional duty is 
the total amount of accessible value of imported goods,  its basic customs duty and its additional duty. 
 
(5) Please provide India’s view on the consistenc y of the special additional duty with the WTO 
agreement, especially in terms of  paragraph 1 of Article II and pa ragraph 2 of Article III of GATT 
1947. 
 
(d) Education Cess 
 (1) Japan understands that the education-cess is also levied on imported goods in addition to the 
basic customs duty, the additional duty, and the special additional duty.   
Please clarify what kind of imported goods are subject to the education-cess. 
 (2) Japan understands the rate of the educati on-cess is 3%. If this rate varies according to 
imported goods, please indicate the respective rates which are applied to respective imported goods. 
 
(3) Please explain why the education-cess is app lied twice to only imported goods along with its 
legal basis.  
(4) Please confirm that it is right to understand th at the tax base of the education-cess is the total 
amount of the basic customs duty, the additional duty and the special additional duty.   
(5) Please provide India’s view on the consistency of the education-cess with the WTO 
agreement, especially in terms of paragraph 1 of Article II and paragraph 2 of Article III of 
GATT 1947. 
(xi) Standards and other technical requirements 
 (Question 8: page 52, paragraph 54) 
(1) Please explain the legal basis of and the servi ces provided by the eight laboratories possessed by 
the BIS.  
(2) The Secretariat report describes that mo re than 60 licenses have been granted under 
the Foreign Manufacture’s Scheme in some 15 countries.  
Please provide specific names of the countries and licensed operators. 
 (3) M
EASURES DIRECTLY AFFECTING EXPORTS  
 (ii) Quality control and preshipment inspection 
 
(Question 9: page 61, paragraph 83) 
It is informed that India has introduced export tax measures on iron ore (about 7US$ per ton) and 
chromium ore (about 45US$ per ton) since March 1
st, 2007.  
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Page 44  
 
  Japan would like to know the details of the meas ures and the reason why India has introduced the 
measures.  (4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 (ii) Taxation and non-tax assistance 
 
(Question 10: page 76, paragraph 126) 
According to this paragraph and its  relevant footnote of the Secretariat Report, corporate tax for 
foreign branches amounts to 41.82%, whereas that for India’s domestic company amounts to 30%. 
Both domestic companies and foreign branches partic ipate in Indian economic activities in a similar 
fashion and should be dealt without distinction.   
 Please provide the details of the measures and th e reason why India has introduced the measures. 
 
(iii) Price controls 
 
(Question 11: page 80, paragraph 140) 
(1) Japan would like to know related inform ation on the background and objectives of the 
Maximum Retail Price (MRP) Scheme. 
 
(2) Please clarify what kind of imported articles are subject to the MRP scheme. Please explain 
why those specific articles are subject to the MRP.  
(3) In which case would the additional duty be calculated based on the MRP as its tax base? 
Please clarify what kind of imported articles are subject to this scheme. 
 
(4) When the imported article is actually sold in  India at the lower retail price than the MRP 
decided to pay the additional duty, would the ove rpaid amount of the additional duty be refunded? 
 
(v) Intellectual property rights 
 
(Question 12: page 84, paragraph 153) In order to facilitate the technological transfer by  utilizing intellectual property rights, Japan finds it 
desirable to remit the royalty of intellectual property rights to abroad freely. 
(1) Please indicate whether India has specific re gulations on such remittance of royalty. 
 (2) If yes, please provide any plan to dere gulate such legislation in the future. 
 
(Question 13: page 84, paragraph 155) 
(1) With the latest revision of the Indian Pate nts Act in 2005, Section 2(1) (ta) was introduced 
which sets forth that “(ta) “pharmaceutical substa nce” means any new entity involving one or more 
inventive steps.” The requirement of an inventive st ep is a general requirement applicable not only to 
pharmaceutical substances.   
 
Please explain why India introduced this provision to define "pharmaceutical substance" by using 
"inventive steps". Please indicate whether there are any differences in patent protection conditions 
applicable to pharmaceutical substa nce-related inventions and to ot her substances-rela ted inventions. 
  WT/TPR/M/182/Add.1 
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  (2) With the latest revision of the Indian Patents Act in 2005, a condition was added to the Indian 
Patents Act which goes as follows: “the mere disc overy of a new form of a known substance which 
does not result in the enhancement of the known efficacy of that substance….” 
 
Please indicate whether there is any criterion appli cable to the difference between a mere discovery 
(that is unpatentable) and a patentable invention. 
 
(3) Section 3(d) includes the following explanation; “For the purposes of this clause, salts, esters, 
ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, 
combinations and other derivatives of known substance shall be considered to be the same substance, 
unless they differ significantly in properties with regard to efficacy.”   
 
Please explain why this explanati on was added to Section 3(d). 
 
Is there any criterion applicable to the enhancem ent of a known efficacy of a known substance? If 
there are any criteria applicable to the conditions  mentioned above, please provide this information. 
 
(4) Section 64 sets out provisions on revocation of a patent by the Appellate Board. Section 66 
stipulates that “Where the Central Government is of opinion that a patent” “is” “generally prejudicial 
to the public,” “the patent shall be deemed to be  revoked.” Section 85 allows the Controller to revoke 
a patent on the ground of non-working. Under Section 117A, an appeal can be filed in any of these 
cases described in Sections 66 or 85.  
Is there an opportunity for a judicial review of a d ecision to revoke or forfeit a patent in any of these 
cases described in Sections 64, 66, or 85  (Article 32 of the TRIPS agreement)? 
 
(Question 14: page 91, paragraph 182) 
According to the Secretariat Report, “there is no sp ecific legislation regulating the protection of trade 
secrets or enforcement measures/penalties fo r violation of trade secrets” in India. 
 (1) This paragraph also menti ons, “Aggrieved parties can seek action through the Civil Court.”  
 
Although there is no specific legislation, please explain how a victim, who is aggrieved from acquisition or disclosure of information by measures in unfair business practice, seeks redress. If yes, 
please indicate what kind of system and legal basis on which such redress is based. 
 
(2) In relation to the above (1), are there any relevant common laws or case laws for protection 
against acquisition or disclosure of trade secrets by measures in unfair business practice in India? 
Please indicate the outlines and grounds for the judgment of major cases. 
(3) Are there any specific provisions or means to identify and protect the secrecy of trade secrets 
presented by the parties before the court in the civil procedures under the Law of India? 
 (4) Please indicate whether the criminal proce dures and penalties would be applied in cases of 
disclosure, acquirement or use by a third party without the consent of legitimate holders of 
Undisclosed Information. If yes, please indicate th e names or titles, and the outlines of the criminal 
procedures and penalties of the law. 
 (5) Please indicate any plan to prepare any kind  of domestic laws for civil and (or) criminal 
protection of trade secrets hereafter. If yes, please indicate the outlines of its laws. 
 WT/TPR/M/182/Add.1 
Page 46  
 
  (Question 15: page 91, paragraph 185) 
According to the Secretariat report, “the police al so have ex officio powers under the Trade Marks 
Act, 1999, which permits any police officer not belo w the rank of deputy superintendent of police or 
equivalent, to search and seize without warrant th e goods, die, block, machine, plate, and other 
instruments or goods suspected of infringing intellect ual property.  However, the police officer must 
obtain the opinion of the Registrar before any search and seizure.”  
 
(1) Please indicate whether the Indian Governme nt has the ex officio power to prosecute under 
the Trade Marks Act, 1999, in addition to the ex officio powers for the police to search and seize 
without warrant the goods, die, block, machine, pl ate, and other instruments or goods suspected of 
infringing intellectual property. If yes, please clar ify whether the prosecutor conducts such power.  
 
(2) Japan would like to be informed of the ex officio powers of search, seizure and prosecution 
under intellectual property Laws such as the Pa tent Law, Design Law and Copyright Law.  
 
(3) While the Secretariat report describes “the police also have ex officio powers under the Trade Marks Act, 1999, which permits any police officer not below the rank of deputy superintendent of 
police or equivalent, to search and seize without warrant the goods, die, block, machine, plate, and 
other instruments or goods suspected of infringing intellectual property, the report points out, “the police officer must obtain the opinion of the Re gistrar before any search and seizure.” Both 
descriptions look controversial in terms of the ex of ficio power to the police (the police has power to 
search and seize, while the prosecutor exci ses power to search, seize and prosecute). 
 
Japan would like to be informed of th e detailed structure of the legislation. 
 
(4) Please explain the specific reason why the police officer in India must obtain the opinion of 
the Register before any search and seizure, while the Japanese legislation grants the ex officio power 
of search, seizure and prosecution to the police.  
(Question 16: page 92, paragraph 187) 
The Secretariat report explains, “There is a growing realization of the need to sensitize the judiciary 
on the role of IPRs and the impact of IP viol ations on the economic climate, and creativity and 
innovation, including through seminars for the judiciary.” 
 Japan would like to be informed of the average term  of trial in Civil and Criminal judgments on IPRs 
matters, as well as detailed information on the burden of proof by the plaintiff.  
 
IV. TRADE POLICIES BY SECTOR 
 
(4) M
ANUFACTURING  
 
(iii) Automobiles 
 (Question 17: page 124, paragraph 83) 
According to the Secretariat report, the exports of auto components increased from US$578 million in 
2001/02 to US$2.1 billion in 2005/06, while exports  of automobiles as a proportion of total 
production increased from 3.5% to 8.9% during th e same time. This indicates that exports of 
automobiles play a significant role as an engine to promote the Indian economy.   
(1) In order to further promote these exports of automobiles, does India have any plan to 
participate in the UN/ECE framework (‘1958 Treaty’ ) regarding technical prescriptions for wheeled 
vehicles, equipment and parts, so that the vehi cles exported from India can enter foreign markets 
without re-examination of the importing countries, such as the EU?   WT/TPR/M/182/Add.1 
 Page 47 
 
 
  (2) Japan would appreciate it if India indicates future prospects of joining the 1958 Treaty. 
 
(iv) Information technology (IT) 
 
(Question 18: page 125, paragraph 86) 
(1) According to the Secretariat report, India h as eliminated all the specified 217 tariff lines since 
1 March 2005 as a member of the Information Te chnology Agreement (ITA). However, India still 
levies duties, such as the special additional duty a nd the education-cess on certain IT products, which 
are subject to the ITA.   
 Please provide India’s view on the consistency of imposing such duties with the ITA. 
 
(2) Japan understands that India levies bank gua rantee (10%) on the importation of any kind of 
digital camera which should be treated as the ITA product for more than two years, and it 
substantially works as a custom duty.  
 Please provide India’s view on the consistency of such bank guarantees with the ITA. Japan would 
like to know when India intends to eliminate such bank guarantee systems. 
 
(5) S
ERVICES  
 
(ii) Commitments under the General Agreement on Trade in Services 
 
(Question 19: page 127 paragraph 91) In paragraph 7(8) of the Indian Foreign Exch ange Management Regula tions, 2000 stipulates, "A 
national of a foreign state resident in India being an employee of a foreign company …may…, 
hold…a foreign currency account with a bank outside India and receive the salary payable to him for 
the services rendered to the office/branch/subsidiary /joint venture in India of such foreign company 
by credit to such account:  provided that, the amount  to becredited to such account shall not exceed 
75 percent of the salary accrued to or received  by such person from the foreign company."  
 
Please indicate the position of the Indian Government  to the consistency of this regulation with the 
GATS agreement.  (iii) Financial services  (Question 20: page 128, paragraph 94) 
(1) Please elaborate on the policy objective to maintain public sector banks (PSBs) 
 (2) Could India indicate any plan to privatize these public sector banks? 
 
(3) The Secretariat report explains that all comme rcial banks are still required to allocate a certain 
percentage of net lending to priority sectors.  
Please explain whether and how such an obligation is consistent with the obligations of market access 
under the GATS. 
 
(iv) Telecommunications 
 
(Question 21: page 133, paragraph 115 footnote 159) Footnote159 of the Secretariat report states that the majority of directors on the Board must be 
resident Indian citizens. In addition, PRES NOTE NO.3 (2007 SERIES) published on 19 April 2007, 
indicates that not only the majority of directors on th e Board but also the Chief Officer in charge of WT/TPR/M/182/Add.1 
Page 48  
 
  technical network operations and the Chief Security Officer should be a resident Indian citizen, and 
that the positions of the Chairman, Managing Dir ector, Chief Executive Officer (CEO) and/or Chief 
Financial Officer (CFO) would require to be secur ity vetted by the Ministry of Home Affairs (MHA) 
if held by foreign nationals.  
 (1) In India’s schedule of commitment under the GAT S and offer in this round, India maintains 
the reservation that the detailed terms and conditions  for providing the service will be as per license 
conditions in the MA column, and ‘Unbound’ in the NT column. 
 
Japan would like to clarify in which column (MA or  NT) of the schedule and the offer India maintains 
the reservations concerning footnote 159.  
 
(2) Please provide the outline of the “security bet.” Please provide detailed information on terms 
and conditions required from the viewpoint of security. 
 
(3) Please indicate any plans to eliminate the measures concerning nationality requirements of 
directors on the Board. 
 
(4) In the PRES NOTE NO.3 (2007 SERIES), it is also indicated as restrictions concerning 
Remote Access (RA) that RA to the Network would be provided on ly to approved location(s) abroad 
through approved location(s) in India.  
 Please provide specific examples and information a bout the terms and conditions required for the 
approval, and what kinds of operations th rough RA are allowed after the approval. 
 
(5) Please confirm that it is right to understand that the revision of nationality requirements and 
restrictions for RA have been put into effect by the PRES NOTE NO.3 (2007 SERIES). If not, please explain what procedures and processes will be taken to put the revision into effect. 
 
(6) In the other conditions stipulated in the licensing agreement, please provide all non-
conforming measures to MA or NT, excep t for nationality requirements and RA. 
 
(Question 22: page 133, paragraph 115 footnote 160) 
Footnote 160 of the Secretariat report describes that the MTNL is majority government-owned 
(56.25% of total equity). 
 (1) Japan understands that the government also holds all shares of the BSNL. Please indicate 
which authority or ministry of the Government hol ds the shares of the BSNL and the MTNL. Please 
provide information on any plan to sell off the shares.   
(2) Please provide specific provisions of laws  and regulations s tipulating government 
shareholdings.  (Question 23: page 134, paragraph 116) 
While the expansion for the market share of privat e service providers in the mobile sector, public 
company has still kept 92.6% of the market share in the fixed phone sector.  
 (1) Please provide the names of service suppliers designated as major suppliers in fixed (local, 
long distance, international), mobile and ISP sectors and indicate specific criteria of the designation. 
 (2) Please provide information on the regulations  regarding major suppliers in each sector. 
   WT/TPR/M/182/Add.1 
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  (3) Please provide information on the regulati ons to prohibit cross-subsidization from a 
monopolistic sector to a competitive sector (information including specific provisions and their outline). 
 
(Question 24: page 134, paragraph 117) 
As for the simplification of licen sing regime through the UAS license, 
 
(1) Please provide information on the specific provisi ons of regulations to establish the period of 
time normally required to issue a license (not only the UAS license but all kinds of licenses). 
 (2) Please provide information on the specific provi sions of regulations to set down responsibility 
to provide reasons for the denial of a license to the applicant upon request. 
 (3) Please clarify in what sub-sector the UAS is classified under the W/120. 
 
(Question 25: page 134, paragraph 118) 
Although the Secretariat report explains the gradua l relaxation of the limitation of foreign capital 
participation, India’s domestic telecom market is not adequately open to foreign service suppliers, as 
the scope and level of relaxation remains limited.  
(1) Please indicate any plans to further relax the lim itation of foreign capital participation? If yes, 
please provide information on the scope  and level of the relaxation. 
 
(2) Some reservations of domes tic non-conforming measures in India were not written in India’s 
schedule of commitment under the GATS and revised offer, based on Article 14 of the GATS 
regarding security reasons.  
 Please provide all domestic non-conforming measures which are not described in India’s schedule of 
commitment under the GATS and revised offer.  
 
(Question 26: page 134-135, paragraph 117, 119,120) 
(Government report: page 22, paragraph 103) The Secretarial report describes that entry fees and licensing fees have been reduced on Unified 
Access Service (UAS), national long-distance (NLD) and international long-distance (ILD).  
 
(1) Japan would like to know whether or not India intends to keep reducing the requirements and fees in these areas. 
 
(2) Japan understands that the adjusted gross re venue (AGR) is different from “gross revenue”. 
Please explain the methodology to calculate the AGR. 
 
(3) Under the licensing criteria, telecom carriers are obliged to deposit a “Bank Guarantee” and 
“Financial Bank Guarantee”. Please elaborate on the methodology to calculate these Guarantees. 
 
(4) According to paragraph 124 of the Secretar ial report, telecom carriers are obliged to 
contribute 5% of their AGR to the Universal Servic es Fund. Japan would like India to clarify whether 
or not the contribution for the Universal Services Fund (5% of AGR) is included in the license fee 
(6% of AGR), and also to elaborate on the legal gr ounds of the obligation by briefing and specifying 
the articles. 
 
(Question 27: page 135, paragraph 121) 
The Secretarial report points out that the broa dband policy announced by the DOT on 14 October 
2004 allows service providers to access mutu ally agreed commercial arrangements. WT/TPR/M/182/Add.1 
Page 50  
 
  (1) Japan would like to know whether or not the Indian authority establishes domestic regulations 
on these commercial arrangements. If yes, please provide information on the name and related article of the regulation. 
 
(2) Please indicate whether the dominant carrier is subject to any extra regulation by these kinds of regulations when the dominant carrier agrees to a commercial arrangement with a non-dominant 
carrier. If yes, please elaborate on the extra regulation imposed on the dominant carrier.  
 
(3) Japan would like to know whether or not the I ndian authority ensures any arrangement within 
the dictates that keep interconnection charg es cost-oriented and sufficiently unbundled. 
 
(4) Please provide a standard form of this kind of arrangement. Please provide information as to 
whether, under the agreement, a telecom carrier is allowed to provide broadband services by such 
forms as dry-copper, line-sharing or bit-stream access scheme. 
 
(5) Please elaborate on the procedure to revi ew the interconnection charges on the facilities 
possessed by a dominant carrier. What regulations ar e established in order to keep interconnection 
charges reasonable and fair for all carriers? 
 
(Question 28: page 135, paragraph 122) 
According to the Secretarial report, TRAI regulates tariffs for services where markets are not 
competitive.   
(1) Please indicate what criteria the Indian aut hority has to determine whether the market is 
competitive or not. 
 
(2) If the Indian Government has a system to evaluate the competitiveness of the market, please 
elaborate on the evaluation methodology, the segmentation of the market and results of evaluation of 
each segmentation. Please clarify whether TRAI  is responsible for the evaluation.  
 
(v) Transport 
 
(Question 29: page 141, paragraph 146) 
The Secretariat report states, "In 1977 and a Tariff Authority of Major Port (TAMP) was established 
to regulate tariffs for all major ports;  non-major ports are administered by respective state 
governments."  
Japan believes that Freight Tax (Income Tax) is exempted reciprocally under the bilateral tax 
agreement between India and Japan. At Haldia Port and Paradip Port in Eastern India, which are two 
of 12 major ports in India, however, there are many cases in which a taxman tries to impose Freight 
Tax if the taxman finds that a vessel is register ed in other countries (e.g. Panama) which India does 
not conclude such a tax agreement but is owned by a Japanese shipping company. In such cases, if the 
shipping company submits additi onal documents requested by the taxman, the payment will be 
exempt; yet such a situation has not occu rred in the other ports in India.   
 
Please explain why such unreasonable practices are undertaken at those two ports. 
   WT/TPR/M/182/Add.1 
 Page 51 
 
 
  QUESTIONS FROM THE UNITED STATES  
 I. ECONOMIC ENVIRONMENT  (4) D
EVELOPMENTS IN FOREIGN INVESTMENT  
 
Paragraph 39 (page 29) of the Secretariat report say s “that, despite economic liberalization, foreign 
direct investment (FDI) had not entered India to the degree expected…”  The United States welcomes 
India’s efforts and notes that the sectors that have been liberalized the most, such as IT and services 
(as described in section IV, “Trade Policies by Sector”) are recording the highest rates of growth in 
India.  
-- Please provide an update on India’s plans to eliminate FDI caps in the insurance and multi-
brand retail sectors.    
-- Does India plan to allow greater foreign inv estment in sectors, whether directly and/or 
indirectly, where growth rates are lagging, su ch as in the agriculture sector and in major 
services sectors like banking?   Increased liberalization in such areas as multi-brand retail, capital markets, basic infrastructure, food pro cessing and distribution networks would help to 
create the conditions necessary for further investment in the Indian economy.   
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
 (2) T
RADE POLICY OBJECTIVES  
 
--Page 23, Para. 15:   According to the Secr etariat’s Report, India has introduced “duty-
neutralizing” measures in addition to measures ex isting at the time of the previous TPR.  These 
reportedly include “sectoral initiatives in agriculture ...” and other products, such as footwear, that 
India has targeted for further export growth .  Please describe the nature of the new duty-
neutralizing measures.   
 
(3) T RADE AGREEMENTS AND ARRANGEMENTS  
 
(ii) Regional Trade Agreements  
 
Pages 24-25, Table II.1:   We thank India for Table II.1, summarizing its current commitments under 
regional trade agreements.  In addition, we commend India for the transparency of its Department of 
Commerce website, on which many of its RTAs can be found.  However, of the nine arrangements 
listed in the table, India has notified only fo ur to the WTO (SAFTA, APTA, Sri Lanka and 
Singapore).  When does India plan to notify the re maining five of its agreements to the WTO? 
 (4) F
OREIGN INVESTMENT REGIME  
 
(iii) Incentives 
 
Page 30, Para 43 :  Please explain how it is determined if  a “value-addded” norm will be met by a 
particular proposed project.  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(2) M EASURES DIRECTLY AFFECTING IMPORTS  
 
(i) Procedures WT/TPR/M/182/Add.1 
Page 52  
 
  Page 35, Paragraph 12
:  The report states that all importers and exporters must obtain an importer-
exporter code (ICE) number from the Director Gene ral of Foreign Trade (DGFT) in order to conduct 
business.  Are there restrictions on who may apply to  be an authorized importer/exporter and receive 
an ICE number?  What criteria does the DGFT use to authorize and issue an ICE number?  Please describe the process that a company or individual must follow in order to receive an ICE number. 
 
(v) Tariff Rate Quotas  Paragraph 33 on page 44 of the Secretariat’s report provides a brief description of India’s tariff rate 
quotas.  The paragraph also states that certain quotas are issued “on the basis of requests from 
designated agencies.” 
 
--  How does India determine which agen cies are allowed to request quotas?  
 
--  Please identify these “designated agencies.” 
 
The paragraph highlights that, although there app ear to be no quotas assigned for certain products 
(milk powder, for example), imports have occurred at out-of-quota rates.    
-- Why does this happen and why are the quot as for these products not being allocated?  
 
-- Our traders advise that quota announcements are often delayed as a matter of procedure.  
How does India currently announce and allocate quotas?   What steps has the Directorate 
General of Foreign Trade consider ed to improve quota allocation?  
 (vi) Other Charges Affecting Imports  
 
Page 44, Paragraph 34
:  The report states that the VAT is not levied on imports or exports.  However, 
is the VAT levied on imported products  when transferred within India? 
 Page 44, Paragraph 34
:  The report notes that differences remain between the special duty applied to 
imports and other domestic taxes and that while the special duty is 4%, like domestic products may be 
subject to a tax rate less the 4%.    For each state,  please identify: (1) the speci fic internal tax or taxes 
that the special duty on imports allegedly counterbala nces, (2) whether any of these internal taxes also 
apply to imported products , and (3) whether any of these internal taxes subject imports to taxation in 
excess of like domestic products.   Please explain how India determined that a special duty on imports 
of 4% is appropriate to counterbalance intern al taxes on domestic products when some domestic 
products are subject to taxation at less than 4%.      
 Annex III.1, paragraph 3 of the report states that th e additional duty rates charged on imports are the 
same as the excise duties charged on domestic product s.  The report further states that the additional 
duty is calculated as a percentage of the value of the import plus any applicable tariff.  How does 
India ensure that the effective rates of additional duty on imports are the same as the excise duties 
charged on like domestic products, if only the former  include applicable tariffs in the calculation of 
the amount of duty owed?  (vii) Tariff Preferences  
In several instances (page 44, paragraph 35; page  45, table III.2; page 121,  paragraphs 69-70), the 
Secretariat report refers to tariff preferences provi ded by India to certain partner countries in the 
textile and apparel sector, indicating that the actual level of preference is low.  But the report does not 
provide a comprehensive list of whic h textile and apparel products are e ligible for prefer ential access.   WT/TPR/M/182/Add.1 
 Page 53 
 
 
  India is an important and potentially large market  for developing and least developed countries’ 
exports of textile a nd apparel products.   
 
-- Please provide a comprehensive list of specific textile and apparel produc ts that are eligible 
for preferential access into India under each of India’s preference programs or regional 
agreements.  Also, please list for each product the preferential rate of duty, qualifying rule of 
origin and any other conditions or limitations on preferential access.    -- What are the Indian government’s current plans to provide unilateral tariff preferences to least developed countries, in terms of specifi c product coverage in th e textile and apparel 
sector, preferential rate of duty, qualifying ru le of origin and any other conditions or 
limitations on such access.    
(ix) Import Prohibitions, Restrictions, and Licensing  
Paragraph 37 on page 46 outlines some of the re asons why India maintains imports or export 
prohibitions.    
-- One justification given for import prohibitions  is “prevention of agricultural surpluses.”  
Please explain.  
 
In paragraph 37, page 46, Table III.4, the Secretaria t report mentions the prohi bition of animal rennet. 
 
--  The World Organization for Animal H ealth (OIE) code for Bovine Spongiform 
Encephalopathy (BSE) clearly states that no B SE-related requirements should be applied to 
milk or milk products.  Why does India prohibit animal rennet as it relates to dairy products?   
 
Paragraph 39 on page 47 of the Secretariat report notes that India maintains import restrictions on 
about 415 tariff lines at the HS-8 digit level under Articles XX and XXI of the GATT.   
-- Please provide a complete list (HS-8 digit level)  of India’s current import restrictions under 
Article XX and XXI?   
 
-- Outside of restrictions under Article XX and XXI, what other import restrictions does India 
currently maintain?   
 Page 47, paragraph 40 contai ns the following statement:  
 
“Imports of certain items, including second-hand cars (over three-years old) and imports from Sri 
Lanka subject to preferential tariffs (such as tea) , must be imported through specified ports (Mumbai 
for second-hand cars, Kochi and Kolkata for tea and Chennai, Mumbai and Jawaharlal Nehru Port Mumbai for garments)”.  
--Please clarify whether the requirement to import through specified ports (Chennai, Mumbai 
and Jawaharlal Nehru Port Mumbai) applies to all garments from all sources, or only 
garments from Sri Lanka subject to preferential tariffs.    -- In either case, what is the rationale for such a requirement? 
 
In paragraph 40 on page 47, the Secretariat report in dicates that India also monitors imports of about 
300 items considered “sensitive.”  
-- How does India define “sensitivity” and wh at becomes of products so defined?  WT/TPR/M/182/Add.1 
Page 54  
 
  What guidelines or criteria does India use to de termine whether or not an item is “sensitive”? 
 -- Is there an open process?  Is the public  allowed to participate in the process?  
 -- How often are products on the “sensitive” list reviewed?  Are they ever removed from the 
list?  What is the process for seeking and obtaining removal of a product from the sensitive 
list?  
(xi) Standards And Other Technical Requirements   
The supplement to the Government of India’s Fo reign Trade Policy (2004-2009), notified to the WTO 
Technical Barriers to Trade Committee on May 23, 2 006, requires that all imports containing products 
of modern biotechnology receive prior approval from the Indian Genetic Engineering Approval 
Committee, and that all imports would, on a shipment -by-shipment basis, be required to document the 
“genetic content” of the commodity.  
 
-- Please provide details regarding the com position of the Indian Genetic Engineering 
Approval Committee, its authority and the scope of this regulation.  Will India implement a 
testing regime in relation to this regulati on and which entity would hold responsibility for 
implementing this testing?  Further, would results of tests conducted by this entity be 
recognized across all Indian States? 
 
(xii) Sanitary and Phytosanitary Measures  Paragraph 57 on page 54 of the Secretariat report describes India’s current efforts to streamline the enforcement of SPS procedures and enforcement by consolidating 13 laws under the Food Safety and 
Standards Act.  We understand that the Food Safe ty and Standards Act would actually consolidate 
seven laws.    
-- Please confirm how many laws and which on es will be consolidated under the new act. 
 
--Please provide further details regarding th e envisioned role of the Food Safety and 
Standards Authority (FSSA), slated to be estab lished under this act.   Particularly, will FSSA 
become part of an existing specific Ministry?  What will be the jurisdiction and role of the 
Authority?  How will it interact with other Ministries?   --Will FSSA have a role in the areas of bio-engi neered foods, feeds, and seeds?   Will this 
Authority develop new regulations?  On what existing standards will it base its regulatory 
requirements?  --What is the current status of this Act?  Wh at is India’s timeline for implementing this Act 
and establishing the FSSA?    
In paragraph 61, page 55
, the report states that, according to the authorities, India’s restrictions on 
imports of live birds, fresh poultry meat, and meat products due to avian infl uenza (AI) have been 
resolved amicably.  By India’s WTO notificati on (April 17, 2007), we recognize its steps towards 
bringing AI policies for dried processed pet food in to line with the recommendations of the World 
Organization for Animal Health (OIE). 
 
--What risk assessment did India use to support the current ban on processed poultry, meat, live pigs and pig meat products? 
  WT/TPR/M/182/Add.1 
 Page 55 
 
 
  --The World Organization for Animal health (OIE) does not recommend nationwide 
restrictions on commercial poultry due to AI findings in wild birds.  What is India’s policy on poultry and meat products from countries free of notifiable avian influenza (NAI) and free of highly pathogenic notifiable avian influenza (H PNAI)?  How does India ensure that such 
import policies are applied on a non-discriminatory basis?  
 
--What is the relationship between India’s curren tly applied AI measures and those laid out in 
the OIE guidelines, pertaining to acceptable intern ational measures to prevent the spread of 
this disease through commercial poultry trade?  
 
Paragraph 61, page 55: 
 The Secretariat states that  according to authorities, the ban on the use of food 
grade waxes has been resolved amicably.  We r ecognize India’s steps toward bringing policies on 
food grade waxes into line with those of Codex Alimentarius for beeswax and carnauba wax. 
 
--Why has India not approved shellac as a f ood grade wax, recalling that the Codex 
Alimentarius recommended it be approved as such?   
 
--What risk analysis did India perform that led to  this exclusion?  Is shellac approved for use 
in food products domestically—including in pharmaceutical products?   
 Paragraph 61 on page 55
 of the Secretariat report mentions India’s “best before” date labeling 
requirement for fresh fruit. 
 
--Codex standard 1-1985 (Rev. 1-1991) 4.7(vi) states that an indication of minimum durability shall not be required for fresh fruits and vegetables.  To our knowledge, no other 
country requires a “best before” date on perish able commodities.  What safety concerns is 
India trying to address with this measure?   
 
--How does India intend to enforce such a requi rement with respect to domestic produce?   
 
-- What steps is India’s Ministry of Health and Family Welfare taking to align these requirements with international guidelines? 
 
(xiii) Labeling  In paragraph 65, page 56, t
he Secretariat report briefly ment ions the proposed broad labeling 
requirement for genetically modified food.   
 
--Given the broad definition of biotech-enhanced  food under this proposed amendment, what 
is India’s rationale for requiring biotechnolog y labeling, even if the end-product does not 
contain any genetically engineered material and how will India be able to enforce such 
requirement?  
 
-- Why would India base labeling requirements on process of production, rather than on food 
safety considerations?   
  (xiv) Government Procurement   
Regarding paragraph 78 on Page 55 of the Secretariat’s report: 
  
--Is India considering becoming an observer in the WTO Committee on Government Procurement? 
  WT/TPR/M/182/Add.1 
Page 56  
 
  --Does India have plans or a timetable for commencing its accession to the WTO Agreement 
on Government Procurement?   
(3) M
EASURES DIRECTLY AFFECTING EXPORTS  
(vii) Duty And Tax Concessions 
 
Page 64, Para. 94:   According to the report, the Advance Au thorization Scheme and the DFIA Scheme 
require “positive value added” and “minimum  value added of 20%” in exports.  Please  
explain how it is determined that these requirements are met. 
 
(4) M EASURES AFFECTING PRODUCTION AND TRADE  
Page 79, paragraph 138:   Is India undertaking efforts to reform its fertilizer subsidy policy?   
 Page 80, Para. 139
: The Secretariat’s report mentions that, in addition to direct subsidies, “transfers 
are made to state governments and by individual government ministries and agencies, including to 
state-owned enterprises and for research and development.” 
 
-- What is the nature and scope of these transfers? 
 
-- Please explain why these transfers are not s ubject to the notification obligation under 
Article 25 of the SCM.  Otherwise, pl ease provide the relevant notification. 
 
(v) Intellectual Property Rights 
 
Patents 
 Standards of patentability :  Does India plan to consider any am endments or further modifications to 
the patent law, including with respect to patentability criteria?   
Pre-grant opposition:   In paragraph 157 of the Secretariat’s Report, it is noted that the Patent Act 
provides for pre-grant opposition to the granting of a patent.  How does India ensure that the pre-grant 
opposition procedure does not unreasonably delay the grant of a patent? 
In paragraph 158 of the Secretariat’s Report, it is  noted that efforts are being made to clear the 
backlog of patent applications.  Please confirm wh ether India is considering technical assistance to 
address the shortage of patent examiners.  If so, pl ease provide information about the nature of such 
assistance.  
Paragraph 161 of the Secretariat’s Report notes that  appeals will be made to the newly established 
Intellectual Property Appellate Board., Is the Inte llectual Property Appellate Board (IPAB) in India 
fully operational?  Have all IP-related appeals been handed over from the High Court to the IPAB?  
 
Data Protection 
 
Does India, as a condition of approving the marketing of pharmaceutical or of agricultural chemical 
products which utilize new chemical entities, require th e submission of undisclosed test or other data 
to establish that the product is safe and/or effectiv e?  If so, how does India protect such data against 
unfair commercial use?   WT/TPR/M/182/Add.1 
 Page 57 
 
 
  Trademarks/Geographical Indications 
 
Paragraph 173 of the Secretariat’s Report relates to protection of ge ographical indications.  Please 
clarify how an application for a geographical indi cation is treated by the Controller General of 
Patents, Designs, or Trademarks (or other competen t authority), if it conflicts with a prior-in-time 
trademark.  Copyright 
 
In paragraph 154 of the Secretariat’s Report, it is noted that there are proposals to amend further the 
Indian Copyright Act, in light of the WIPO Copyright Treaty and the WIPO Performances and Phonograms Treaty (WIPO Internet Treaties).  When does India plan to revise the Copyright Act to 
implement adequately the provisions of the WIPO Internet Treaties?  
 
In paragraph 169 of the Secretariat’s Report docume nt, India notes that "compulsory licenses may be 
issued for works withheld from the public . . . ."  Can compulsory licenses be issued for non-Indian 
works that are withheld from the public?  Does  “Indian works” include U.S.-produced works, 
performances and phonograms that are recorded or ma nufactured in India?  Please explain the scope 
of Sections 31 and 31a of the Copyright Act a nd how many licenses have been granted by the 
Registrar of Copyrights, pursuant to these provisions , within the last 5 years.  Of those licenses 
granted, please provide information as to the typ es of works, uses of the works sought by the 
complainants, and any additional inform ation on how these licenses are granted. 
 
Enforcement 
 
Paragraph 184 of the Secretariat’s Report notes that an  amendment is currently under consideration in 
India that would transfer the power of banning impor t of IPR-infringing copies from the Registrar of 
Copyrights to the Commissioner of Customs.  Please provide information on how the proposed 
amendment improves India’s customs enforcement system, including the timetable for 
implementation of the amendment.  Are there a ny other improvements to the customs enforcement 
system that India is currently considering?  Paragraph 185 of the Secretariat’s Report suggests that the courts are backlogged and there are 
significant delays in bringing criminal and civil case s to final judgment.  Please provide information 
on how India plans to improve the efficiency of court proceedings in IPR cases. 
 Paragraph 148 of the Indian Government Report re fers to State Governments’ responsibilities for 
enforcement and the establishment of IPR Cells.  Please provide information on how enforcement 
statistics from the State level IPR Cells ar e conveyed to the Central Government.   
 
-- Further, is the information provided on a regula r basis, and is it available to the public?  Do 
the State-level IPR Cells collect information on the number of IPR cases settled through the 
courts, whether sentences and/or fines were imposed in criminal cases, and how much time was served in cases involving sentencing?  Is th is information made available to the public, 
and if so, how?  If this information is not curre ntly collected by the State-level IPR Cells, are 
there plans to begin to systematically collect this information? 
Paragraph 148 of the Indian Government Report furt her refers to an Inter-Ministerial Coordination 
Committee on IPR Enforcement Issues.  Please pr ovide information on the composition of this 
Committee, how often it meets, whether it produces or plans to produce a report of its work, and the role of State Governments with respect to the Committee.  WT/TPR/M/182/Add.1 
Page 58  
 
  IV. TRADE POLICIES BY SECTOR 
 (4) M
ANUFACTURING  
(ii) Steel 
 Page 123 paragraph 78:  Please provi de detailed information about (1) India’s export credits for steel 
and (2) how steel exports benefit from the Advance Authorization Scheme and Duty Entitlement Pass 
Book Scheme.  How will the government help steelmakers reduce the “high cost of capital 
resources”?  
 
(5) S
ERVICES  
(iii) Financial Services 
 Banking:   Paragraph 99 (page 129) of the Secretariat report describes gradual measures India is taking 
to lift restrictions on foreign banks.  We note th at India has met its minimum WTO commitment by 
approving only 13 and 12 foreign branch licenses in th e past two years.  We also appreciate the steps 
India is taking to improve its prudential require ments, based on recommendations from the Financial 
Action Task Force (FATF), as described in paragra ph 122 (page 26) of India’s report.  However, we 
are concerned that the Reserve Bank of India is re fusing applications for more foreign bank licenses 
in India due to Indian branch licenses put on hold  until effective anti-money laundering provisions are 
in place.  
-- Will India extend national treatment considera tion to foreign banks applying for branches 
in India? 
 
-- What is the status of India’s implementation of FATF recommendations for an effective anti-money laundering scheme? 
 
Insurance:   Paragraph 106 (page 131) states “Foreign inv estment is restricted to 26 percent of total 
investment; an amendment to increase the restric tion to 49 percent is under consideration by the 
Government.”  Please provide an update on In dia’s consideration of this amendment. 
 Securities:   Paragraph 112 (page 133) describes the leve ls at which foreign institutional investors 
(FIIs) are permitted to invest in the securities sector.  Paragraph 114 of India’s report states that “the 
limits for FII investment in government securities and corporate debt have been gradually enhanced in 
order to provide more investment opportunities to FIIs and greater depth to the Indian debt market.”   
We agree that FIIs can invest in debt securities,  but these limits, although enhanced, are still too low 
for India's needs and the interest of foreign capital, t hus maintaining a barrier to greater capital flows.  
What steps is India taking to further liberalize th e securities sector to allow for greater investment 
flows?   
(iv) Telecommunications 
 Paragraph 115, page 133:
 This paragraph indicates that the De partment of Telecommunications is 
responsible for policy formation and the granting of licenses.   
--What role does the Department of Space play in the licensing of satellite services in India?  
Specifically, why must licensees obtain foreign space segments through the Department of Space’s domestic satellite system operator ISRO?  What are India’s plans to permit more flexible commercial arrangements? 
  WT/TPR/M/182/Add.1 
 Page 59 
 
 
  Paragraph 118, page 134:   We commend India for increasing foreign equity limits from 49% to 74% 
in telecommunications services such as internati onal and domestic long distance calls.  Does India 
intend to bind these commitments in the WTO/GATS?  Paragraph 121, page 135:
  Does India’s Department of Tel ecommunications plan to revisit the 
Broadband Policy recommendations issued by the te lecom regulator TRAI in 2004, which advocated 
an Open Skies policy with respect to the u se of foreign satellites for VSAT services?  
 We note that the Broadband Policy issued by the De partment of Telecommunications in 2004 did not 
include such a provision.  
 
 
QUESTIONS FROM THE REPUBLIC OF KOREA
 
 
1. Tariff Structure  
 (WT/TPR/S/182 pp.39~40 para.25, p.98 Annex III.1) 
 
 The Indian government levies additional duti es and special additional duties over and above 
the normal customs duties. There are some cases wh erein the sum of those duties is higher than the 
bound duty rate of India to the WTO.    The argument put forward by the Indian government in favor of the imposition of these additional and special additional duties is that, wh ile the former are levied as a compensation for 
domestic excise duty from which imported products are exempted, the latter are charged in order to 
bring the overall tax burden on domestic products  in line with that of imported ones.  
  However, as the Secretariat report point ed out, the special additional duties are 
"not harmonized with internal taxes, making it uncl ear to what extent the taxes on imports and on 
domestic goods are equivalent". In addition, it is not yet clear whether exactly the same rate of 
additional duty is applied on the imported produc ts as that of the excise duty on like domestic 
products.  
 (1) What is the basis of the specific 4% special additional duty?  
 
(2) How does the Indian government ensure that  both domestic and impor ted products have the 
same tax burden with the system of the additional and the special additional duty?  
 (3) What is the Indian government's position on reforming the current additional and special 
additional duty system into a more WTO consis tent one of imposing the same domestic tax on 
both domestic and imported products? If such reform is difficult, what is the reason? 
 2. The Corporate Tax 
 (WT/TPR/S/182 pp.76~77 para.126~128)  
 In India, the corporate tax deduction rate at the source is applied differently for Indian and 
foreign companies. The rate is fixed for Indian co mpanies in the Income Tax Act but is not clearly 
defined for foreign companies. Accordingly, the tax offices in India apply different tax rates at their 
own accord for foreign companies. In many cases, th e deduction rate applied to foreign companies is 
far greater than that for the Indian companies.  
 WT/TPR/M/182/Add.1 
Page 60  
 
   Such arbitrary application by the tax offices lo wers the foreign companies' ability to forecast 
their cash flow and profitability and makes their bus iness plans very unpredictable. In addition, the 
unfair large number of deduction rates bring about huge financial costs.  
 (1) Korea requests the Indian government to intr oduce a uniform corporate deduction rate system 
and incorporate it into the Income Tax Act for bot h Indian and foreign companies. What is the 
view of the Indian government on this request?  
 (2) The corporate tax rate for Indian companies in the fiscal year 2007- 2008 is 30%, whereas that 
for foreign companies is 40%. The different application of corporate tax rates is 
discriminatory treatment to foreign companies, and therefore, contrary to the WTO rules. 
Does the Indian government have any plans to introduce uniform corporate tax rates for both 
Indian and foreign companies alike?  
 
3. Export Subsidy  
 
(WT/TPR/S/182 p.77 para.129)  
 
 It is our understanding that the Indian gove rnment maintains the EPCG (Export Promotion 
Capital Goods) Scheme, which allows a lower ra te of tariff for capital goods imported by the 
companies who have met certain export targets for a specified period. It also has the DEPB (Duty 
Entitlement Pass Book) Scheme, which exempts tariffs on raw material imports for export.  
  These schemes appear to be inconsistent with  the WTO subsidy rules, which prohibit export 
subsidies. What is the position of  the Indian government on the in consistency of these measures with 
WTO rules?  
 
4. Anti-dumping Measures: Trade Remedy Policy  
 (WT/TPR/S/182 pp.48~50, WT/TPR/G/182 p.32) 
  According to para 44 of the Secretariat's repor t, India has initiated a total of 176 anti-dumping 
investigations since 2002 (as of June 30, 2006). Furt hermore, India undertook a total of 171 final anti-
dumping measures since 2002 (as of June 30, 2006), which places India near the top of the list of countries that frequently resort to such measures.  
 
 Contingency trade measures should be take n to protect domestic industries from unfair 
foreign trade practices in exceptional cases. Moreover,  given that the initiation of the investigation 
will affect the business activities of the investigated exporters by imposing an additional burden, more 
prudential approach is required in  initiating such investigations.   
  Korea also requests that these cases be handled  in a more transparent way and with due 
consideration of consumers' interest.  
Korea is concerned about India's frequent an ti-dumping measures. As such, Korea hopes that 
India will review and improve the anti-dumping related system.  
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 Page 61 
 
 
  5. Labeling  
 (WT/TPR/S/182 p.56 para.64~65)  
 
 Although India liberalized its regulations on imports in 2001, the Indian government's 
requirements regarding the labeling of imported goods  have expanded. The Standard of Weights and 
Measures Rules of 1977 has been applied to all imported retail goods since that time.  
  Current Indian government regulations requi re exporters to attach a label including 
information on the product and impor ter to products before they are exported. Specifically, exporters 
must include the maximum retail price, taking into  consideration anticipated expenses accrued in 
India such as customs duty, domestic taxes, additi onal charges, marketing and distribution expenses, 
as well as importer's name, address, product name, quantity and date of packaging.  
  These requirements place an undue burden on ex porters. Because the maximum retail price 
marked on the products is considered the actual reta il price in India, calculating the price is time-
consuming and requires exporters to employ additional resources.  
  Does the Indian government plan to harm onize its labeling requirements with the 
international standard, which demands onl y "a reasonable amount" of information?  
 
6. Delays in permitting Branch Offices  
 (WT/TPR/S/182 p.30 para.40~43) 
 
 Many Korean companies interested in maki ng investments in India establish their branch 
offices or liaison offices in India as a preparatory step.  
  The procedure to establish a branch office in India is lengthy and time consuming. In order to establish those offices, foreign companies should get permission from the RBI and the Reserve Bank of India. Normally the RBI, before providing perm ission, requests the opinion of the Indian Ministry 
of Finance (MOF), and the MOF in turn requests opinions from relevant Ministries including the 
Ministry of Home Affairs and the Ministry of Commerce.  
 
Thus, investing companies face huge problems in setting their investment plans in India due 
to lengthy delays, sometimes as long as 10 months.  
 
 Does the Indian government plan to introduce a scheme to enhance the predictability of 
business activities in India for foreign investors?  
  Korea suggests the following scheme: A certain time limit should be fixed to complete the 
process, and if it is difficult to meet this time line du e to the need for further investigation, this fact 
should be communicated to the relevant companies with the reason for the delay.  
 
What is the view of the Indian government on this suggestion?  
 
7. Double Guarantee System in Construction  
 
 When India's state-owned enterprises orde r major projects that require construction 
guarantees, they recognize only local banks as the guarantee bank, but do not extend such benefit to 
foreign banks.  
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Page 62  
 
  As a result, foreign companies that have manage d to get orders in India have to submit a 
Counter Bank Guarantee to a local bank and then re ceive a Bank Guarantee from the local bank. This 
double guarantee requirement is a burden to many foreign companies as it raises costs, such as the guarantee commission, and acts as a barrier to investment in India.  
 
 Korea hopes that the Indian government will expand the eligibility of the banks entitled to 
issue guarantees to foreign banks with high credit ratings.  
ADDITIONAL QUESTIONS FROM THE REPUBLIC OF KOREA
 
 
1. Standards (WT/TPR/S/182 pp.52~53 para.52~54)  
 
(1) Paragraph L of Annex 3, which is a code of good practice for the preparation, adoption and 
application of standards, of the WTO Agreemen t on Technical Barriers to Trade stipulates the 
following:  
  "Before adopting a standard, the standardizing body shall allow a period of at least 60 days for the submission of comments on the draft standard by in terested parties within the territory of a Member 
of the WTO. This period may, however, be shortene d in cases where urgent problems of safety, health 
or environment arise or threaten to arise." 
  However, in the case of India, draft standard s on the Bureau of Indian Standards website are 
published for a minimum of one month. This period appears to be inconsiste nt with the above WTO 
rules. How much time does India grant on average for comments on draft standards and what is the 
position of India on this inconsistency? 
 
(2) Paragraph F of Annex 3 of the WTO Agreement on Technical Barriers to Trade stipulates the following:   "Where international standards exist or their completion is imminent, the standardizing 
body shall use them, or the relevant part of th em, as a basis for the standards it develops, ~." 
 
But, according to paragraph 53 of the Secretariat's report, the number of corresponding 
ISO/IEC standards is only 5,821 and accounts for 32% among the total of 18,219 in 2005/2006. The 
other standards account for 12,398.  
 
Are the standards that correspond to other in ternational standards such as ITU, CODEX 
included in the 12,398 standards?  Korea also expe cts India to make efforts to harmonize the 12,398 
standards with international standards fo r trade facilitation among the WTO members.  
 (3) The items required for ISI compulsory certifi cations were reduced from 133 at the time of the 
last Review to 66 at that of this Review. ( http://www.bis.org.in/cert/man.htm)  Thus, trade is expected 
to be further promoted. But, the number of items under mandatory certification published by the Bureau of Indian Standards* is different from 66 in paragraph 54 of the Secretariat's report. Korea 
requests an explanation regarding this  difference between the two numbers.  
  
PREGUNTAS PLANTEADAS POR LA REPUBLICA DE COLOMBIA
 
 
Reporte de la Secretaría WT/TPR/S/182 
 
EL Gobierno de Colombia presenta al Gobierno de la India, las siguientes inquietudes con respecto a 
su examen de política comercial: 
  WT/TPR/M/182/Add.1 
 Page 63 
 
 
  I. ENTORNO ECONOMICO 
 4) Evolución de las Inversiones Extranjeras  
“40. El fuerte aumento de las entradas de inve rsiones de cartera, de unos 944 millones de dólares 
EE.UU. en 2002/2003 a unos 12.500 millones en 2005/2006 (más del doble que las entradas de IED), 
se debe a factores tanto mundiales como internos.   Los mercados emergentes en su conjunto se han 
beneficiado de los bajos tipos de  interés a largo plazo aplicados en las economías adelantadas.  
Además, los buenos resultados obtenidos por las empresas en la India y el firme crecimiento 
consiguiente del PIB, unidos a la elevación de los límites impuestos a los inversores institucionales 
extranjeros, pueden haber impulsa do las inversiones de cartera.”. 
 
• ¿Existe la posibilidad de adelantar operaciones (i ncluyendo inversión) en  moneda extranjera? 
 
5) Perspectivas  
“43. Si bien las reformas más estructurales ha n tendido a concentrarse en la manufactura y en 
algunos servicios (servicios financieros, telecom unicaciones y algunos servicios de transporte), es 
necesario abordar los problemas subsistentes en la infraestructura (especialmente los relativos a la 
electricidad y el transporte) y en la agricultura.  La reforma del sector eléctrico, en particular, 
contribuirá en cierta medida a resolver las limi taciones de productividad en la manufactura y los 
servicios.  Por lo que se refiere a la agricultura , aunque se están tomando medidas para reducir los 
obstáculos a la comercialización de productos agrop ecuarios, las subvenciones continúan excluyendo 
la inversión pública en infraestructura e investig ación y el sector sigue siendo relativamente poco 
productivo.  Existe también un subempleo sustanci al en la agricultura, y es necesario redoblar los 
esfuerzos orientados al desarrollo de industrias conexas, como la elaboración de alimentos, que 
podrían absorber los excedentes de mano de obra agrícola.”. 
 
• Además de los criterios mencionados (costo , el empleo propuesto y las exportaciones, 
necesidades de divisas  y datos financieros) ¿cuáles son las consideraciones que tiene el 
gobierno indio para la aprobación de las solic itudes de inversión? ¿Existe un procedimiento 
establecido o depende de un análisis caso a caso? 
 
• ¿Cómo es la política de transferencia de lo s capitales relacionados con una inversión 
(incluyendo la liquidación de la misma)? ¿E xiste un impuesto a la salida de dividendos? 
 “44. Para lograr un crecimiento sostenido más alto es imprescindible una mayor inversión pública 
y privada en capital tanto físico como humano (así como en nuevas tecnologías, que son la principal 
fuente de crecimiento a largo plazo).  Según la Co misión de Planificación, la principal fuente de 
inversión física adicional sería la inversión interna bruta, que debería aumentar del 30 por ciento del 
PIB actual al 35 por ciento y tendría que proceder tanto del sector público como del privado.  Sería 
necesario facilitar la inversión del sector priv ado mediante una reducción de las limitaciones 
relacionadas con las políticas y los excesivos costos de transacción, lo que favorecería la adopción de 
medidas destinadas a mejorar el entorno para lo s inversores (incluidas la ley de competencia 
promulgada recientemente y las medidas para mejo rar la gestión empresarial).  También se podrían 
hacer esfuerzos para movilizar recursos mediante un aumento de las entradas de IED que, a pesar de 
las importantes reformas en el régimen correspondiente , se han mantenido en torno al 1 por ciento del 
PIB.  Esto parece indicar que otros obstáculos,  entre ellos las limitaciones infraestructurales y 
administrativas, continúan disuadiendo a los invers ores extranjeros.  También sería deseable un 
aumento de la inversión pública en esferas de im portancia decisiva, como la agricultura, la 
infraestructura y otros servicios públicos esenciales, en  particular la educación y la salud, para lograr 
que las altas tasas de crecimiento económico registra das recientemente en la India beneficien a más WT/TPR/M/182/Add.1 
Page 64  
 
  gente, que es uno de los principales objetivos de la política del Gobierno.  La inversión pública en 
educación y formación y en salud contribuiría además al  crecimiento, al facilitar la mejora del capital 
humano.”.  
• ¿Existen incentivos específicos para sectores o actividades determinadas?  
 
• Los sectores hacia los que se dirige principalmente la inversión extranjera en la India han sido 
receptores de inversión de manera espontánea? O ¿Hubo un proceso de selección por parte de 
la India para atrae inversión extranjera hacia ellos?.  En caso afirmativo explicar ¿cómo fue el proceso de selección? 
 
• ¿A cuánto asciende la inversión de India en el extranjero? ¿En qué sectores? 
II. RÉGIMEN DE POLÍTICA COMERCIAL: MARCO Y OBJETIVOS 
1) M
ARCO CONSTITUCIONAL Y JURÍDICO GENERAL  
 i) Marco institucional y jurídico 
“4. En virtud del artículo 123 de la Constitución, si el Presidente considera necesario promulgar 
legislación durante los períodos de inactividad de l Parlamento, se puede promulgar una orden, que 
tiene la misma fuerza lega l que una ley parlamentaria.   Sin embargo, expirará seis semanas después de 
la reapertura del Parlamento, salvo que sea sancionada como ley por ambas cámaras”.  
• ¿Esta facultad del Presidente incluye la aprobación de Acuerdos Internacionales de 
Comercio? 
• De ser así,  ¿Qué pasa con el Acuerdo, al cabo de las 6 semanas, si no es sancionado por 
ambas cámaras? 
ii) Formulación y aplicación de la política comercial 
“9. El Departamento de Comercio del Minister io de Comercio e Industria sigue siendo la 
institución responsable de formular y aplicar la po lítica comercial, en consulta con otros ministerios 
fundamentales como los de Hacienda y Agricultura , los ministerios relacionados con los servicios, y 
el Banco de la Reserva de la India.  La política comercial se formula y prepara en consulta con los 
gobiernos de los Estados y de los Territorios de la  Unión, asociaciones industriales y de agricultores, 
organismos comerciales, instituciones académicas y de  investigación y otras partes interesadas.  Las 
políticas se anuncian para un período quinquenal, junto con exámenes anuales, en la Política de 
Comercio Exterior (denominada anteriormente Política de Exportación e Importación), acompañada 
del Manual de Procedimientos.  La Dirección Gene ral de Comercio Exterior se encarga de la 
aplicación de la Política de Comercio Exterior y de  los Procedimientos y la Comisión de Aranceles 
brinda asesoramiento sobre los aranceles y cuestio nes conexas.  Ambos organismos dependen del 
Ministerio de Comercio e Industria….”   
• ¿El Manual de Procedimientos para el comercio exterior (importaciones y exportaciones), 
cambia cada 5 años?  
• ¿Se publican tales cambios antes de entrar en  vigencia y se informan oportunamente a la 
OMC?   WT/TPR/M/182/Add.1 
 Page 65 
 
 
  “10. El Departamento de Comercio también tiene a su cargo la política relacionada con los 
cultivos de plantación (té, café, caucho, cardamomo  y tabaco), las zonas económicas especiales y los 
programas de promoción de las exportaciones y de ga rantía del crédito a la exportación, a través de 
una serie de órganos autónomos y empresas del Es tado.  Las empresas del Estado son la Corporación 
de Comercio de Estado de la India (STC), la STCL Limited, la MMTC Limited, la PEC Limited, la 
Corporación de Garantía del Crédito a la Export ación (ECGC), y la Organización de Promoción del 
Comercio de la India (ITPO).  La STC, la STCL, y la MMTC también participan en actividades de comercio de Estado).”  
• ¿Las zonas económicas especiales y los programas de promoción de las exportaciones y de 
garantía del crédito a la exportación, otorgan beneficios económicos u operativos, de derecho 
o de facto (de hecho) en proporción o relación con las exportaciones que se realicen?  
III. POLITICAS Y PRÁCTICAS COMERCIALES POR MEDIDAS 
 
Panorama general 
 
“1. Además de los aranceles, se aplica a las im portaciones un derecho adicional (en lugar del 
impuesto especial central aplicado a la producción n acional) y un derecho adicional especial del 4 por 
ciento (para compensar parcialmente impuestos internos tales como el impuesto sobre el valor añadido, el impuesto municipal, los "derechos de los comités de mercado", etc.), con el fin de dispensar trato nacional a las mercancías importadas.”.    
• ¿El derecho adicional a las importaciones que se menciona en este párrafo, se aplica a todos 
los productos que se importan en la India? 
• ¿Cuál es el monto del “derecho adicional”? ¿E s un derecho específico o un porcentaje ad-  
valorem? 
• ¿Se aplica el derecho adicional, así como el derecho adicional especial a los productos 
originarios de países con los que tienen negociadas preferencias arancelarias? 
2. Medidas que afectan directamente a las importaciones. 
 
xi) Normas y otras Prescripciones Técnicas  
“48.  La Oficina de Normas de la India (BIS) (a nteriormente Institución de Normas de la India), 
establecida en virtud de la Ley relativa a la Of icina de Normas de la India, de 1986, y en 
funcionamiento desde el 1º de abril de 1987, está encargada de la formulación y aplicación de normas 
en 14 sectores…” 
 
• ¿La Oficina BIS es un organismo público, privado o mixto? 
 “54.  En virtud de la Ley relativa a la Oficina de  Normas de la India, de 1986, y sus correspondientes 
reglamentos y normas, la BIS administra un sistema de  certificación de productos.  Se otorga la marca 
de la BIS (ISI) a los productos que cumplen las prescr ipciones de las normas pertinentes de la India.  
Aunque la certificación ISI es voluntaria, se le ha dado carácter obligatorio en el caso de 66 productos relacionados con la salud y la seguridad de los c onsumidores (133 en la fecha del anterior Examen).
1  
No está claro qué productos se han suprimido de la list a.  Los productos que figuran en ella, tanto si 
son importados como si son de producción nacional, deben estar en conformidad con los requisitos de 
                                                      
 1 Apéndice III de la Clasificación Co mercial de la India según el SA.  
 WT/TPR/M/182/Add.1 
Page 66  
 
  certificación.  La BIS tiene ocho la boratorios que realizan pruebas de  la conformidad de los productos 
importados y de los de producción nacional.  Por otra parte, la BIS ha aprobado una serie de 
laboratorios independientes acreditados que han demo strado tener un sistema en  conformidad con la 
Guía 17025:1999 de la ISO/CEI y de laboratorios bajo  el control del Gobierno Central y los gobiernos 
estatales, y los utiliza para llevar a cabo pruebas de conformidad.
2  También puede obtenerse la 
certificación de productos fuera de la India una  vez aprobadas y autorizadas por la BIS las 
instalaciones de producción del fabricante de que se trate.  En el marco de ese sistema para fabricantes extranjeros se han otorgado más de 60 licencias en unos 15 países.  Los derechos de licencia incluyen 
el costo de la visita y estancia del inspector, un derecho anual de 1.000 rupias (20 dólares EE.UU.) y 
un derecho anual de marca do de 2.000 dólares EE.UU., que ha de pa gar el fabricante.  La licencia es 
válida inicialmente por un año y puede renovarse anualmente (previo pago de un derecho de 500 
rupias, alrededor de 10 dólares EE.UU.).
3  Los importadores indios pueden obtener también una 
licencia de la BIS siempre que tengan la infraestructura necesaria para realizar pruebas de cada envío cuando llegue a la India.  La BIS aplica sistem as de certificación internacional CEI y ha sido 
designada organismo nacional de certificación para el  reconocimiento y la expedición de certificados 
en el marco de los sistemas CEIEE-CB y CEIQ.
4  Además de la certificación de productos, la BIS 
otorga licencias y la ECOMARCA con respecto a lo s productos favorables para el medio ambiente.”. 
 
• ¿La India no tiene reglamentos técnicos vigent es? ¿Ha tenido en el pasado? ¿O, con carácter 
obligatorio solamente existe la certificaci ón exigida en el caso de los 66 productos 
relacionados con la salud y la seguridad de lo s consumidores, mencionados en este numeral? 
 
• ¿La India cuenta con un inventario de regl amentos técnicos vigentes y de productos con 
certificación obligatoria? ¿En qué sectores de la economía se concentran? 
 
• ¿La India publica las observaciones que formulan los interesados sobre un proyecto de 
reglamento técnico? 
 
• ¿En qué ramas de la industria cuenta la India con laboratorios acreditados? 
 
• ¿La India ha suscrito acuerdos de reconocimiento mutuo? 
 
4) Medidas que afectan la producción y el comercio. 
 v) Derechos de propiedad Intelectual 
 
• ¿Existe en India una política nacional en materia de Propiedad Intelectual? 
 
IV. POLITICAS COMERCIALES, POR SECTORES  
 
2) Sector Agropecuario 
 
                                                     
 
 2 Para obtener una lista completa de los laboratorios reconocidos, véase la información en línea de la 
BIS en la siguiente dirección:  http://www.bis.org .in/lab/osladd1.htm  [1 3 de junio de 2006].  
 
 3 Información en línea de la BIS, consultada en:  http://www.bis.org.in/cert/fm.htm [13 de junio 
de 2006].  
 
 4 Sistema de la CEI de pruebas de conformidad y cer tificación del equipo eléctrico y Sistema de la CEI 
de evaluación de la calidad de los componentes electrónicos, respectivamente.  
  WT/TPR/M/182/Add.1 
 Page 67 
 
 
  ii) Políticas Agrícolas 
 
“ 14.  El Ministerio de Agricultura formula y aplica de manera centralizada la política agrícola, 
siguiendo las directrices generales del Plan Quinquenal sobre dicha política y sobre la asignación de fondos.  De conformidad con la Constitución, la agricultura es una cuestión que compete a los 
Estados, pero es el Gobierno central el que adopta la s decisiones importantes, como las relativas a la 
investigación y el desarrollo, la facilitación de la in fraestructura y las inversiones, el crédito y el 
comercio…  La Comisión de Costos y Precios Agrícolas (CACP) fue creada en 1965 con el fin de asesorar al Gobierno sobre el establecimiento de los precios mínimos de sostenimiento para diferentes productos básicos (25 en la actualidad) y los mecanis mos destinados a aplicar estos precios.  Además 
del Ministerio de Agricultura y la CACP, hay vari os organismos públicos en cargados de aplicar las 
políticas agrícolas y alimentarias.  El más importante de ellos es la Corporación de Alimentos de la 
India (FCI), establecida en 1964 para aplicar las políticas alimentarias, incluida la adquisición y mantenimiento de existencias reguladoras de cereales alimenticios y su distribución a través del Sistema de Distribución Pública y diversos programas sociales de mitigación de la pobreza.  Recibe 
apoyo de la Corporación Central de Depósito, creada  en 1965.  La FCI adquiere cereales alimenticios 
al precio de compra establecido por el Gobierno y lo s vende al precio central de venta, fijado también 
por el Gobierno…”.  
• ¿Cuáles son los productos básicos sujetos a precios mínimos de sostenimiento? 
 
• ¿Cómo determinan los precios mínimos de so stenimiento para los productos agrícolas? 
 
• Agradeceríamos información más detallada sobre la forma como opera el mecanismo 
utilizado para la aplicación de los precios mínimos de sostenimiento.  
 
• ¿Cómo el gobierno determina o establece el precio de compra así como el precio central de 
venta, para la adquisición y posterior vent a de cereales alimenticios por parte de la 
Corporación de Alimentos de la India (FCI)? 
 
“17.  El promedio aritmético de los aranceles NMF aplicados a la agricultura (definición de la OMC) 
aumentó ligeramente, pasando del 40,7 por ciento en 2001/2002 al 40,8 por ciento, frente a un promedio aritmético de los tipos arancelarios consolidados del 117,2 por ciento.  Todos los aranceles 
aplicados a los productos agropecuarios son ad va lorem, a excepción de dos (las almendras con 
cáscara y sin cáscara), no habiendo cambiado la situación desde el examen anterior.  Los tipos 
arancelarios aplicados varían entre el 0 y el 182 po r ciento...  Sin embargo, en la mayoría de los 
aranceles sigue habiendo diferencias considerables entre los tipos aplicados y los consolidados, que 
oscilan entre el 10 y el 300 por ciento.  La India u tiliza también "precios de referencia" para calcular 
los derechos de aduana aplicables a las importacione s de productos como el a ceite de palma (en bruto 
y refinado, blanqueado y desodorizado) , el aceite de oleína de palm a (en bruto y refinado, blanqueado 
y desodorizado) y el aceite de soja en bruto.  De  conformidad con lo dispuesto en el párrafo 2 del 
artículo 14 de la Ley de Aduanas, la autoridad pued e fijar precios de referencia "si tiene la certeza de 
que es necesario o conveniente hacerlo";  los derec hos de aduana aplicados a estas importaciones se 
calculan teniendo en cuenta el precio de refere ncia y no el precio indicado por el importador.
5 
 
• Podría la India señalar, ¿Si la utilización de pr ecios de referencia para calcular los derechos 
de aduana aplicables a las importaciones de productos como el aceite de palma resultan 
compatibles con lo establecido en el Acuerdo del Valor de la OMC? 
                                                      
 5 Según las autoridades, los precios están en consonancia con los precios internacionales y se revisan 
frecuentemente para evitar toda discrepancia con ellos. 
 WT/TPR/M/182/Add.1 
Page 68  
 
   
“21.  … Como país productor de una amplia vari edad de productos agropecuarios, la India está 
también interesada en ampliar sus exportaciones, especialmente de productos hortícolas.  Existen 
políticas específicas para estos productos cuya finalid ad es mejorar la producción y la productividad, 
inclusive mediante el aumento de las in versiones en investigación y desarrollo…” 
 
• ¿Teniendo en cuenta la importancia que reviste para la India el sector hortícola, podría este 
país suministrar información detallada en materia de investigación y desarrollo de este sector de la agricultura? 
 “30.  A raíz de las críticas al Sistema de Distri bución Pública, en 1997 se introdujo el sistema dirigido 
para atender mejor a los sectores más pobres de la  población… En el marco del Sistema Dirigido de 
Distribución Pública, el Gobierno fija los precios centrales de venta, que entrañan una subvención, 
especialmente para los consumidores que vive n por debajo del umbral de pobreza y los que 
pertenecen a la categoría antyodaya anna yojana.  La consignación presupuestar ia para subvenciones a 
productos alimenticios en 2006/2007 es de 239.860 millones de rupias, es decir, el 4,3 por ciento del 
gasto público total.  La compra de arroz y azúcar  está sujeta a "gravámenes", consistentes en una 
proporción determinada de la producción que debe ser vendida al Gobierno central a los precios fijados para el Sistema Dirigido de Distribución Públ ica.   Los Estados, en consulta con el Gobierno 
central, fijan la cantidad de arroz que debe compra r el Gobierno mediante un gravamen reglamentario 
sobre los molturadores y comerciantes de arroz, que varía de un Estado a otro;  actualmente está comprendida entre el 10 y el 75 por ciento del a rroz comprado por los molturadores y comerciantes de 
arroz…” 
 
• ¿Cómo se establece el gravamen reglamentario sobre los molturadores y comerciantes de 
arroz?  ¿Existe este mecanismo para algún otro producto?  ¿Cuál? 
 “36.  Se otorgan subvenciones indirectas a la agricu ltura por diversos medios , como la facilitación del 
acceso al crédito y la suscripción de pólizas de segur os, incluido el acceso al crédito en virtud de la 
obligación de conceder préstamos a los sectores prioritarios impuesta a los bancos comerciales (que deben destinar al sector agrícola al menos el 18 por ciento de sus préstamos totales).  Sin embargo, parece ser que los bancos comerciales han incump lido sistemáticamente este objetivo y han permitido 
que hasta el 1,5 por ciento de esa diferencia en el importe neto de los créditos bancarios a la 
agricultura se deposite en el Fondo para el Desarrollo  de la Infraestructura Rural desde su creación en 
1995/1996.  Este Fondo se estableció para ayudar a los Estados a invertir en infraestructura rural y es 
administrado por el Banco Nacional de Desarrollo  Rural y Agrícola (NABARD).  Hasta 2001/2002, 
los tipos de interés para los bancos que depositaban en el F ondo para el Desarrollo de la 
Infraestructura Rural esa diferencia eran un 0,5 por ci ento menores que los tipos de interés aplicados 
por ese Fondo a los préstamos a los gobiernos de los Estados, pero actualmente se basan en el tipo 
bancario vigente, siendo el tipo de interés inversamen te proporcional a la cuantía de la diferencia en 
los créditos al sector agrícola.”.  
• ¿Existen otros medios de subvenciones indirect as mediante los cuales la India otorga a la 
agricultura, además de las mencionadas en este párrafo? ¿Cómo opera cada uno de estos 
medios de subvención?   
 
Pregunta General. 
 
 
• Como se puede observar, en diversos apartes del Informe de la Secretaría se menciona que la 
India otorga subsidios a una gran cantidad  de actividades relacionadas con el sector 
agropecuario. ¿El monto que destina este país para este objetivo, sobrepasa actualmente el 
nivel de mínimis (10% para países en desarrollo )?. Podría la India explicar su respuesta?.  WT/TPR/M/182/Add.1 
 Page 69 
 
 
  5) Servicios 
 iii) Servicios financieros 
 
“92. Aunque en la esfera de los servicios financ ieros, en especial la banca y los seguros, siguen 
predominando las empresas estatales, se han adopta do medidas para fomentar la competencia del 
sector privado.  Por ejemplo, se han atenuado las restricciones aplicadas a los bancos extranjeros.  
También se han realizado esfuerzos por mejorar la g estión empresarial en los servicios financieros.  
Por ejemplo, el Banco de la Reserva de la Indi a introdujo prescripciones cautelares para acomodar las 
normas del sector bancario a las prácticas internac ionales, aunque se aplazó su aplicación.  Además, 
todas las bolsas de valores deben constituirse en soci edades y, a partir de enero de 2006, todas las 
empresas que cotizan en bolsa deben adoptar las prescripciones sobre gestión empresarial especificadas en el acuerdo de cotización.”.  
• ¿Las instituciones financieras de carácter est atal cuentan con algún tipo de beneficio o 
tratamiento especial con respecto a l as instituciones financieras privadas? 
 
iv) Telecomunicaciones 
 b) Reformas estructurales 
 
“117. Para simplificar el régi men de licencias, en noviembre de 2003 se introdujo un régimen de 
licencias de servicio de acceso unificado para los servici os de línea fija y de teléfonos celulares.   El 
régimen de servicio de acceso unificado permite a un operador suministrar cualquiera o todos los tipos 
de servicios permitidos en la licencia;  por c onsiguiente, ya no se exige a los operadores que tengan 
licencias separadas para cada tipo de servicio sumini strado.  Además, en abril de 2004, los derechos 
de licencia se redujeron un 2 por ciento;  los derechos  actuales oscilan entre el 6 y el 10 por ciento de 
los ingresos brutos ajustados para los servicios de acceso unificado prestados en la zona de servicios 
designada.”  
• ¿El régimen de licencias de servicio de acceso unificado comprende los servicios VozIP?  
 
• ¿Cuál es el régimen aplicable a estos servicios? 
 
“118. Las restricciones a la inversión extranjera se han suavizado desde 2000, cuando se permitió el 
100 por ciento de inversión extranjera para los pr oveedores de servicios de Internet que no disponen 
de cabezas de línea, los proveedores de infraestructura que dispongan de fibras oscuras, y los servicios 
de correo electrónico y correo vocal;  no obstante, las empresas que suministren estos servicios deben desinvertir el 26 por ciento de su capital social a fa vor del público indio en un plazo de cinco años, si 
cotizan fuera de la India.  Desde 2001, se permitió el  74 por ciento de inversión extranjera para los 
proveedores de servicios de Intern et que disponen de cabezas de lín ea, los servicios de radiobúsqueda, 
y los servicios de ancho de banda de extremo a extremo.   En noviembre de 2005, se aumentaron las 
restricciones a la inversión extranjera en capital soci al del 49 al 74 por ciento en determinadas esferas, 
como las líneas fijas, los teléfonos celulares, los servicios de acceso unificado, y los servicios de 
llamadas de larga distancia nacionales e internacionales.” 
• ¿Cuál es el régimen aplicable a los proveedores  de servicios de Internet y quién los regula? 
 
• ¿Existen obligaciones diferentes para los prov eedores de estos servicios que poseen cabezas 
de línea y los que no poseen?  
 WT/TPR/M/182/Add.1 
Page 70  
 
  • ¿A qué obedece el aumento de las restricciones a la inversión extranjera en capital social?  
Qué se busca con tal restricción? 
 
PREGUNTAS ADICIONALES DE COLOMBIA
 
 
DOCUMENTO WT/TPR/G/182 
 
Facilitación Del Comercio  73. ……… Todos ellas se caracterizan por los siguiente s rasgos: i) la evaluación de riesgos se 
basa en el sistema;  ii) aplican el principio de "n i evaluación ni examen" a los clientes con un historial 
limpio;  y iii) recurren a la intervención de manera excepcional.  La introducción del sistema de 
gestión del riesgo ha permitido reducir considerablemente el tiempo de permanencia de las 
mercancías entrantes.  El Departamento también ha  introducido en Delhi, con carácter experimental, 
un sistema de pago electrónico de los derechos de importación para permitir el rápido despacho de las 
mercancías. 
Podrían ilustrarnos con un flujograma e indicar nos ¿cuál ha sido la reducción de tiempo de 
permanencia logrado con la aplicación del sistema de gestión de riesgos? Es decir, informarnos cuanto 
tiempo tomaba entes de la utilización del sistem a y ahora con la aplicación plena del mismo. 
 
DOCUMENTO WT/TPR/S/182 
 
14. Para acelerar el despacho de aduana, en mayo de 1995 se estableció un sistema de 
intercambio electrónico de datos (EDI) que se aplica en todos los puertos y terminales de carga aérea 
importantes. Según las autoridades, ese sistema y un  sistema de gestión de riesgos aplicado en los 
puertos aduaneros importantes han reducido considerablemente el tie mpo empleado en el despacho de 
aduana (sección ii) b) infra ) 
  
¿En cuanto tiempo se despacha en c ondiciones normales una mercancía?  
 
19. El RMS usa un módulo de evaluación de riesgos a efectos de valoración (VRAM) para 
utilizar un valor medio ponderado de importaciones simi lares recientes de mercancías sensibles.  
Según las autoridades aduaneras, el establecimiento  de esas bases de datos electrónicas ha contribuido 
a un despacho más rápido de las mercancías importad as sobre la base de autoevaluación, sin que se 
requiera intervención alguna de la Aduana con resp ecto a "un porcentaje considerable" de la carga 
total;  el porcentaje no puede revelarse po r motivos de observancia de las normas. 
 
¿No obstante la precisión de no revelar el porcentaje  de mercancías importadas sobre la base de la 
autoevalaución, sería viable saber cuál es el por centaje de mercancías inspeccionadas físicamente con 
la utilización del sistema de gestión de riesgos?  
 
Finalmente, podrían informarnos si la utilización del agente de aduanas es ob ligatoria para todas las 
operaciones de comercio exterior o si existe  alguna posibilidad de que los importadores o 
exportadores la puedan actuar ante la  aduana de manera directa?  
 
  WT/TPR/M/182/Add.1 
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  QUESTIONS BY BRAZIL  
 
WT/TPR/S 182 III (2) (viii)  Page 45 Paragraph 36 
 
 Could the Government of India inform us wh at authority is responsible for issuing the 
certificate of origin when it is required from importer countries? 
 
WT/TPR/S 182 III (2) (ix) Page 46 Paragraph 40 
 
 India informs that there are three hundred products subject to import licensing. Could India inform us which products are those in terms of harmonized system? 
 
WT/TPR/S 182 III (2) (ix) Page 46 paragraph 39 
 
 Could the Government of India inform us  the administrative procedure costs on the 
processing of licenses.  WT/TPR/S 182 III (3) (viii) 
 
 According to paragraphs 96-99, pages 65 and 66  of the Secretariat’s report, since 1965 India 
has export processing zones (EPZs) in place. In 1980 export oriented unit (EOU) schemes were 
introduced and, more recently (2001), the Indian  Government further expanded the network by 
establishing Special Economic Zones (SEZs). Indus tries located within EPZs, EOUs and SEZs are 
provided with incentives (income tax relief; exempt ion of import licenses; exemption from customs 
duty for industrial inputs) contingent upon export performance (either there are minimum export requirements or industries are required to  be net foreign exchange earners). 
 
 Export subsidies are prohibited under Art. 3.1(a) of the Agreement on Subsidies and 
Countervailing Measures (ASCM). For some devel oping country Members, such as India, the 
prohibition shall not apply (Art. 27.2), unless the c ountry has reached “export competitiveness” in one 
or more products, when export subsidies on such pr oducts shall be gradually phased out (Art. 27.5). 
  Could India indicate if any of the products  exported from EOUs and SEZs have reached 
“export competitiveness”? 
 
WT/TPR/S/182 III (4) (V) Page 84 
 
 It is clear in note 146, related to paragraph 156, Chapter III, of document WT/TPR/S/182, that 
traditional knowledge is not patentable.  In that sense, please explain how India is granting protection 
to traditional knowledge.   Concerning paragraph 157, Chapter III, of doc ument WT/TPR/S/182, please confirm that the 
titleholder of a patent granted from the some 8, 000 applications that were made through the 
“Mailbox” facility (Articles 70.8 and 70.9 of the TRIPS Agreement) are not able to prohibit or 
prevent third parties exploiting the patent if they  had been already producing the patented product 
when the patent was granted even if the titlehol der does not agree with the amount of royalties 
defined?   What is the actual exhaustion of rights regime for marks in India? 
 
 Concerning paragraph 169, Chapter III, of document WT/TPR/S/182, please explain what are “works withheld from the public”. WT/TPR/M/182/Add.1 
Page 72  
 
   When the author is dead, who is the licenso r (e.g. successor) and who is able to be the 
licensee? And when the author is unknown?   Please inform if and how India is dealing with the mutual existence of geographical 
indications and marks which would result in a likelihood of confusion? 
 
 Concerning paragraph 176, Chapter III, of document WT/TPR/S/182, besides the Protection of Plant Varieties and Farmers' Rights Act, is ther e any other intellectual property legislation in India 
providing for the benefit sharing?  
 What are the statistics concerning the registers of integrated circuits layout-design since the 
Semiconductor Integrated Circuits Layout -Design Act was passed in September 2000? 
  Concerning paragraph 154 of document WT/ TPR/S/182 (p. 84), could India provide further 
information on the amendments it intends to pursue in its copyright legislation with a view to 
complying with the WCT and WPPT provisions? 
  Is there any legislative initiative under discu ssion regarding the implementation of specific 
legislation for the protection of trade secrets (paragraph 182 of WT/TPR/S/182)?   QUESTIONS FROM CANADA
 
 Report by the Government (WT/TPR/G/182)
 
 
Part III – Developments in Trade Policy a nd Continuous Liberalisation of Tariffs, 
paragraph 60, page 15:  
 
Paragraph 60 of the Government Report indicates that India has been working to liberalize their 
import policies.  However, Indian tariffs on impor ted lumber and value-adde d wood products remain 
high.  
  
1. Could India please explain the reasons for con tinuing to have high tariffs on these items? 
 
Part VIII - India and the WTO, (b) Services, paragraph 152, page 31: 
  The Government Report notes that within the GA TS context, India is seeking improved modal 
commitments from developed countries in Cross Border  Supply of Services (Mode 1), and that these 
objectives are driven by its strong competitive ed ge in Information Tec hnology and Information 
Technology Enabled Services. Canada  notes, however, that India has not taken commitments in mode 
1 for Telecommunications Services.   
2. Could India please provide further informa tion on the domestic sensitivities related to 
commitments in Mode 1 for Telecommunications Services? 
 
Report by the Secretariat (WT/TPR/S/182)
 
 
Part II -Framework and Objectives, (4) Foreign  Investment Regime, (i) Overview, paragraph 
38, page 29: 
 
The Secretariat Report notes that the Foreign In vestment Implementation Authority (FIIA) was 
established and provided with "Fast Track Author ity" in order to address constraints, such as  WT/TPR/M/182/Add.1 
 Page 73 
 
 
  the complexity of procedural requirements and a lack of transparency in approval processes, which 
have in the past resulted in lower levels of FD I than could have reasonably been expected.   
 
3. (a) Could India comment on the impact that the creation of the FIIA has had on 
addressing the abovementioned impediments to FDI? 
 
(b) Could India please also elaborate on the specifics of the FIIA's "Fast Track 
Authority"? 
 
Part II - Framework and Objectives, (4) Fore ign Investment Regime, (ii) Legislation and 
approval procedures, paragraph 43, page 30:  
The Secretariat Report indicates that according to Indian officials, 90% of decisions related to 
investment proposals submitted to the Foreign Investment Promotion Board (FIPB) are communicated to potential investors within 4-6 weeks.  The Repor t also notes that subsequent to receiving a positive 
decision from the FIPB, approval from other central or state government agencies must often be 
sought by the investor.    
4. Given the length of time currently required to  complete the review and approval process, 
could India please indicate what steps (in additi on to the measures outlined in the report) are 
being taken/contemplated in order to reduce th e amount of time associated with the review 
and processing of investment proposals?  
 
Part II - Framework and Objectives, (4) Foreign Investment Regime, (iii) Incentives, paragraph 
44, page 31: 
 The Secretariat Report notes that investors ma y receive a number of incentives for making an 
investment in a Special Economic Zones (SEZs).    
5. Could India please elaborate on the incentives ava ilable to investors who invest in a SEZ? 
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, 
(iii) Tariffs, (a) Overview, paragraph 21, page 38:  
The Secretariat Report states that, “the applied tari ff is complex in addition to being announced with 
the annual Budget, rates are changed on an ad hoc  basis through gazetted notifications, with the 
approval of Parliament; numerous exemptions render the system complex to administer, and therefore 
more susceptible to administrative discretion."   
  
6. (a) Could India indicate whether there are plans to simplify their applied tariff regime in 
the near future? 
 
India has been applying a different tariff regime  for refined canola oil as it has for substitutable 
products - namely refined soybean and sunflower oil.  The current applied tariff on refined soybean 
oil is 45%, and the recently announced reduction of  tariff for refined sunflower oil will bring the 
latter down to 60%.  Meanwhile, the tariff for refined canola oil is still at 75% and there has been no 
indications that it would be lowered to be brought in line with like-products.  
(b) Could India please explain why it is applyi ng a different and discriminatory treatment 
to refined canola oil? 
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  Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, 
(iii) Tariffs, (c) Applied MFN tariff, paragraph 25, page 39-40:  
The Secretariat Report states that "in addition to customs duty, importers are required to pay an 
additional duty (countervailing duty) and a speci al additional duty in place of local taxes."  Regarding 
the wine and spirits duty regime , the European Communities (EC) and the US claim that India 
applies "additional duties" and "extra duties" on wine and spirits imports from their countries 
in excess of India's obligations under the GATT 1994.    
7. Could India comment on the rationale for its wine  and spirits duty regime and its consistency 
with India's WTO obligations? 
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, (x) 
Contingency Measures, (a) Anti-dumping and countervailing measures, Measures, paragraphs 
41-49, page 49: 
  
The number of trade remedy cases being initiated by India continues to be very high and injury 
findings are very high in relation to the number of  cases initiated.  Canada notes that in certain 
sectors India suffers from inefficiencies due to infr astructure bottlenecks, high input and freight costs 
and the high cost of capital.    
8. (a) Could India explain to what extent these factors, or economic factors other than 
imports, are taken into c onsideration during the injury phase of trade remedy 
investigations?  
 
(b) In addition, do Indian authorities see a co rrelation between efforts to address these 
problems and the number of trade remedy investigations being initiated?  
 
(c) Could India comment on the relationshi p between tariff levels and the number of 
trade remedy complaints and investigations?  
 
(d) Finally, do Indian authorities see a decline in the number of invest igations in the short 
and medium terms?   
 
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requiremen ts, paragraphs 48-55, pages 50 to 53:  
 The Secretariat Report makes no mention of the pr ocess undertaken by India to develop and adopt 
technical regulations and conformity assessment pro cedures, nor any mention of which Ministry has 
regulatory authority.  
9. (a) Could India explain how its technical  regulations and conformity assessment 
procedures are developed and adopted? 
 
(b) Could India please explain which of its ministries has authority to create technical 
regulations and conformity assessment procedures? 
 
Part III – Trade Policy and Practices by Measure, (2) Measures Directly Affecting Imports, (xi) 
Standards and Other Technical Requirements , (a) Standards, paragraph 48, page 50:  
  
According to the Secretariat Report, the Bureau of  Indian Standards (formerly the Indian Standards 
Institution) established under the Bureau of Indian  Standards Act, and operational since 1 April 1987 
is responsible for formulating and enforcing standards for 14 sectors.  In addition to the BIS standards  WT/TPR/M/182/Add.1 
 Page 75 
 
 
  for 14 sectors, a number of sector-specific standard s for the automobile industry, pollution, food, 
drugs and cosmetic, as well as atomic energy and civil aviation.   
10. (a) Could India explain which of the standards developed by the BIS are voluntary and 
which are mandatory? 
 
(b) Could India explain who develops the other “sector-specific” standards (i.e. those not 
developed by BIS) and which of these standards are voluntary and which are 
mandatory? 
 
(c) Does India develop standards related to wood products?  If so, which organisation(s) 
are the developed by? 
 
(d) What is the Indian Government’s appr oach to adopting wood construction codes and 
standards? 
 
This section of the Secretariat report also stat es that BIS is India’s WTO/TBT Enquiry Point; 
however, no information is provided rega rding BIS’ notification procedures. 
 
(e) Could India please explain how authorities (e.g. WTO Enquiry Point) monitor the 
creation or modification of TBT measures nati onally in order to determine whether to 
notify WTO Members of draft or modified me asures in keeping with the transparency 
obligations established by TBT Agreement?   
 
(f) Additionally, when a determination is made to make a WTO notification, what is the 
mechanism used to prepare it (e.g. interdep artmental/inter-ministerial collaboration, 
etc.)? 
 A quick survey of notifications made by India during the review period indicates that 68% of its notifications were issued after the measure was in force.   
(g) Could India please indicate what steps are be ing taken to ensure that, in keeping with 
the TBT Committee’s Recommendation on the normal time limit for comments on 
notifications, 60 days are provided to Me mbers to comment on draft notifications 
under normal circumstances, and that comments submitted by Members are taken into account 
 Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requi rements, Paragraph 50, page 51: 
 
According to the Secretariat report BIS has concl uded a number of bilatera l cooperation agreements, 
some of which contain provisions for mutual accepta nce of test reports and inspection reports. In 
addition, this section of the Secretariat Report notes that BIS has established Memoranda of 
Understanding (MOU) with a number of countries su ch as Germany, Brazil and the United States.  
 
11. (a) Could India provide a list of the bilatera l cooperation agreements that BIS has signed 
which contain provisions for mutual acce ptance of test and inspection reports?  
(b) Could India provide information on the natu re and coverage of the MOUs that BIS? 
 WT/TPR/M/182/Add.1 
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  Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (a) Standards, paragraph 52, page 52: 
 
The Secretariat Report notes that BIS develops sta ndards through 14 Division Councils and that draft 
standards are published for comments on the BIS website for not less than one month. 
 
12. Could India please identify the policies BIS has in place to ensure that a 60 day comment 
period is provided for all draft standards as s tipulated by the Code of Good Practice (Annex 3 
of the TBT Agreement)? 
 Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (a) Standards, paragraph 53, page 52: 
 
According to the Secretariat Report, 5,821 of the 18,300 standards (approximately) that are in place in 
India have corresponding ISO/IEC standards and of these, 4,307 (or 73%) are harmonized with 
ISO/IEC standards. This section of the Report also st ates that India is expediting its review process of 
existing standards and that a greater number of sector al standards, including in the area of electrical 
safety, tend to be aligned with ISO/IEC standards.  
13. (a) How many of India’s 18,300 (approxima te) standards were developed by BIS? 
  
(b) Are India’s electrical safety standards based on ISO/IEC standards? 
 
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (b) Pr oduct Certification, paragraph 54, page 52: 
 
According to the Secretariat Report, BIS operates as both a standards development organization and a 
certification program under which it manages the application of the Bureau of Indian Standard Mark (ISI). The ISI mark is granted to products both on a voluntary and mandatory basis. There are 66 products which must receive ISI certification due to health and safety concerns (i.e. where its 
application is mandatory). Manufacturers, including foreign manufacturers, are able to apply the ISI 
mark if they have been certified by BIS. And,  BIS has been designated as a National Certification 
Body for recognizing and issuing certificates under the IECEE CB Scheme. 
 
14. (a) Could India explain how BIS’ standa rds development body and its conformity 
assessment body operate as distinct, separate and independent entities in keeping with 
international best practic es for good governance?  
 
(b) Could India indicate if BIS has been  accredited to ISO/IEC Guide 65, the 
international conformity assessmen t standard for bodies operating product 
certification programs?  
 
(c) Does India recognize testing and certification by foreign certification bodies to 
India’s mandatory requirements? 
 
(d) Could India please provide a list of the 66  products that require ISI certification? 
 
(e) Is the ISI mark designed for the purposes of health and safety?  
 
(f) Given that the ISI mark is applied both in a voluntary and mandatory fashion; could 
India indicate how consumers distinguish between products which must contain the 
ISI mark and those which do not? 
  WT/TPR/M/182/Add.1 
 Page 77 
 
 
  (g) Could India please explain to what extent it recognizes certificates issued by other 
National Certification Bodies under the IECEE CB Scheme?  
 
Part III – Trade Policies and Practices by Measure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 56, page 54: 
 
Mention is made in paragraph of 56 of the va rious Indian WTO/SPS Enquiry Points; however, no 
information is provided regarding the coordination among these authorities.   
 
15. (a) Could India explain how the authorities coordinate amongst themselves to respond to 
WTO SPS enquiries?   
 
(b) Could India explain how authorities (e.g. WTO Enquiry Points) monitor the creation 
or modification of SPS measures in their country in order to determine whether a WTO notification is required under the transparency obligations of the SPS 
Agreement?   
 
(c) Following this, when a determination is made, what is the mechanism (e.g. 
interdepartmental/inter-ministerial colla boration, etc.) for preparation of 
notifications? 
 
Part III – Trade Policies and Practices by Measure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 57, page 54: 
 
The Secretariat’s Report states that, “in an attemp t to streamline SPS procedures and enforcement, the 
Food Safety and Standards Act was passed by Parlia ment in August 2006, although it is yet to be 
enforced”.   
 
16. (a) Could India please explain what the required steps in enforcing the legislation are?  
 
(b) Will India be implementing regulations to enforce the legislation? 
 
(c) Will India be notifying the WTO SPS Co mmittee of any changes to its SPS measures 
resulting from the legislation and/or regulations? 
 
Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 61, page 55: 
 
The Secretariat Report notes that in the WTO Committee on SPS Measures, “[s]ome Members also 
expressed concerns about the lateness of India's no tifications on new fumigation requirements in place 
since January 2004, as this did not allow sufficient time for comment; there was also concern that the 
measures deviated from international standards.  Non-notification of various SPS measures was also 
raised by several Members.” 
 
17. (a) Could India please provide information on what measures it is implementing to 
respond to concerns raised by WTO Member s related to India’s ad hoc compliance 
with WTO SPS transparency obligations, in  particular notification of draft trade-
related measures when comments can still be  taken into account (Annex B, paragraph 
5b)? 
(b) Can India explain why several of its SPS notifications issued during the review period 
were issued several months after the measures were in force?   
 WT/TPR/M/182/Add.1 
Page 78  
 
  Canada acknowledges India's effort to adjust its overall SPS regime to international standards.  
However, we note that the response time is unusua lly long for requests for certificates for new 
products, and that it is difficult to obtain a timely response from Indian officials.  For example, a 
Canadian exporter of bovine semen applied last year  for a permit to import into India and has still not 
received the import permit.  Since to our knowle dge no SPS issues have arisen, the permit should 
have been issued within 5 days.   
(c) Could India explain why most requests for consideration of certificates for new 
products face such long delays? 
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, 
(xi) Standards and other technical requirements, (a ) Standards, page 50, paragraph 48, and (xii) 
Sanitary and phytosanitary meas ures, paragraph 62, page 55: 
  
Canada understands that only some low technology  medical devices are certified by BIS, while 
some sterile devices are regulated under the Drugs and Cosmetics Act, and certain medical imaging 
devices are regulated by the Atomic Energy Regulatory Board. 
 
18. (a) Could India please provide greater clarity with respect to existing standards and other 
technical requirements applicable to medical equipment/devices?   
 
(b) Would India please identify what steps it is taking to harmonize its regulation of 
medical devices with international best  practice approaches, such as those 
recommended by the Global Harmonization Task Force (GHTF)? 
 
Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (V) Intellectual property rights, (a) Overview, paragraph 154, page 84: 
Canada notes that according to the Secretariat Repor t “there are proposals to further amend the Indian 
Copyright Act in light of the WIPO's WCT and WPPT treaties.”   
19. Could India please provide more information rega rding the proposals to amend the Copyright 
Act and when it foresees that the Copyright Act will be amended? 
Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (IV) Intellectual property rights, (b) Indus trial property, Patents, paragraph 157, page 
85:  
 
Canada notes that according to the Secretariat Report  “[f]or patents relating to pharmaceuticals filed 
before 1 January 2005 (the "Mailbox "), the rights of the patentee accrue from the date of grant of the 
patent, but the period of protection remains 20 years from the date of filing.  Moreover, the patent 
holder may not institute infringement proceedings  against manufacturers already producing the 
patented product when the patent is granted; in such cases, the pa tent holder is entitled to receive 
reasonable royalties. The law does not define "r easonable", which depends on the circumstances of 
each case, like royalty payment under Article 31 (h ) of the TRIPS Agreement. ” The Secretariat 
Report also notes that “[t]he law also does not defi ne the authority for determining the royalty.”   
 
20. Could India please elaborate upon who determines the royalties due to the patent holder?  
 
Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (V) Intellectual property rights, (b) I ndustrial property, Trade marks, paragraph 164, 
page 87:  
Canada notes that according to the Secretariat Repor t “[r]egistration is not compulsory, but the owner 
cannot bring a legal case against an infringer if the ma rk is not registered. The law also enables a suit  WT/TPR/M/182/Add.1 
 Page 79 
 
 
  for passing off to be filed for the use of any trade ma rk that is identical or deceptively similar to the 
plaintiff's trade mark, whether registered or unregis tered.”  The first sentence seems to prohibit legal 
cases for all unregistered trademarks while the second allows suits in some instances such as passing 
off of unregistered trademarks.    
21. (a) Canada would be grateful if India could clarify the limitations on the right to bring 
legal cases for unregistered trademarks.   
 
(b) Would India please identify if there are a dditional instances (i.e. other than passing 
off) in which the owner of an unreg istered trademark can bring suit? 
 Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (V) Intellectual property rights, (c) Copyright, paragraph 169, page 88:  
 
Canada notes that according to the Secretariat Re port “[c]ompulsory licences may be issued for works 
withheld from the public or for unpublished ‘Indian wo rks’, where the author is dead or unknown.  In 
such cases applications may be made to the Copy right Board, which after holding an inquiry, may 
direct the Registrar of Copyright to issue the licence under specified terms and conditions. "    
 
22. Could India please advise what steps are taken to identify the copyri ght holder before a 
compulsory license is issued?   
 Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (V) Intellectual property rights, (d) Other Intellectual Property, Trade secrets, paragraph 182, page 91:   
The Secretariat Report states that “[t]here is no specific legislation regulating the protection of trade secrets nor enforcement measures/penalties for violations of trade secrets.  However, aggrieved 
parties can seek action through the Civil Courts.”     
23. Would India please detail what actions can be take n by aggrieved parties in Civil Court in the 
absence of specific legislation?  
 Part IV – Trade Policies by Sector, (2) Agricult ure, (ii) Agricultural Policies, (a) General 
Framework, paragraph 15, page 103:  
  
The Secretariat Report says that, India's first Na tional Agricultural Policy aims “to raise annual 
growth in agriculture over the next two decades to over 4% based on an efficient use of resources 
while conserving India's soil, water, and biodi versity and equity across the regions...”  
  India's National Forest Policy (1988) goals were “to have a minimum of one - third of the total land 
area of the country under forest or tree cover. In the hills and in mountainous region, the aim should 
be to maintain two-third of the area under such cover in order to n India aims at maintaining a 
minimum of 33 percent of country’s geogra phical area under forest and tree cover.” 
  
24. (a) Could India provide information on current policies with respect to maintaining or 
increasing their forest land cover and work  in the area of sustainable forest 
management of their existing forest resources? 
Canada notes India's strong desire to see increase gr owth in the agricultural sector at all levels of the 
value chain, including the production, processing and di stribution levels.  However, there has been no 
sign of allowing greater foreign par ticipation in the retail sector.   
 WT/TPR/M/182/Add.1 
Page 80  
 
  (b) Would India please explain to what extent it intends to remove the barriers to foreign 
direct investment in the food retail sector? 
 
Part IV - Trade Policies by Sector, (2) Agricultur e, (ii) Agriculture policies, (b) Import Policy, 
paragraph 16, page 104: 
 The Secretariat Report notes that India continues to  use trade policy to support its overall goals of 
food self-sufficiency and price stability. Accordingly, tariffs are adjusted from time to time to ensure 
sufficient domestic supply of key products. For example, in 2006 India granted a tariff duty 
exemption for imports of wheat. 
 
Wheat exporting countries welcomed the trade opportunity created by this tariff exemption.  
25. Could India please identify when it will be adjus ting its trade policy towards more permanent 
tariff reductions and a predictable trade envir onment for wheat and other similar agricultural 
products? 
 
Part IV - Trade Policies by Sector, (4) Manufa cturing; (iv) Information Technology (IT), 
paragraph 85, page 125: 
 
The Secretariat Report notes that the information te chnology (IT) industry is comprised of software 
development, IT enabled services (ITES), busin ess process outsourcing (BPO), and hardware 
manufacture.  
26. Could India please provide further detail on how ITES is defined? 
 Part IV - Trade Policies by Sector, (4) Manufa cturing; (iv) Information Technology (IT), 
paragraph 86, page 125: 
 
The Secretariat notes that FDI of up to 100% throug h the automatic route is permitted in electronics 
and information technology hardware manufacturing,  software development, and ITES sector, except 
business-to-consumer (B2C) e-commerce. 
 
27. (a) Could India provide further information on what is meant by the “automatic route”? 
 
(b) Could India please provide information on the FDI threshold for B2C e-commerce?  
 
(c) Could India please provide further detail on  why B2C is subject to a different FDI 
threshold than other IT sub-sectors?  
 
Part IV - Trade Policies by Sector, (5) Servi ces, (ii) Commitments under the General Agreement 
on Trade in Services, paragraph 91, page 127:  
 With regard to the statement in the Secretariat Report on India’s current GATS commitments and its 
initial and revised offers, Canada seeks the following clarifications from India:  
28. Could India please explain if the following Mode 3 limitations in India’s schedule/offer are a 
reflection of India’s domestic legislative st atus quo:  foreign equity limitations for 
engineering services, legal entity requirements for computer and related-services, commercial 
presence restrictions for environmental services and foreign ownership in respect of travel agencies and tour operator services? 
  WT/TPR/M/182/Add.1 
 Page 81 
 
 
  The horizontal limitation on taxation (added in India’ s initial offer) states that “Taxation laws for 
domestic and foreign service suppliers, as per the pr ovisions of the Income tax Act, 1961, shall 
apply.”    
29. Could India please provide for more clarity with respect to the new limitation in its revised 
offer relating to taxation?  
 
30. (a) With respect to the temporary entry of business persons, does India's domestic 
regulatory regime allow for the spouses of qualifying Contract Services Suppliers (both employees of a juridical person a nd independent professionals) and Intra-
corporate Transferees to work in India for the duration of their contract?   
 
(b) If so, is this employment subject to a labour market test?   
 
(c) Would India consider binding th is access in a revised GATS offer? 
  
31. (a) With respect to the temporary entry of business persons, does India's domestic 
regulatory regime allow for a service s upplier providing after-sales or after-lease 
services in conjunction with a pre-existing c ontract to work in India without the 
requirement of a labour market test or work permit?   
 
(b) If so, is India considering binding this access in a revised GATS offer? 
 
Part IV - Trade Policies by Sector, (5) Serv ices, (iii) Financial Services, (a) Banking, 
paragraph 94, page 128: 
 Paragraph 94 of the Secretariat’s report indicates that the level of non-performing assets (NPAs) in 
priority sector lending has declined in recent years.  
32. Could India please identify if the level of NPAs in priority sectors is higher than non-priority 
sectors? 
 Part IV - Trade Policies by Sector, (5) Serv ices, (iii) Financial Services, (a) Banking, 
paragraph 97, page 129: 
 
Paragraph 97 of the Secretariat Report indicates that the requirement for banks to implement the Basel 
II capital adequacy framework by March 2007 has been postponed by one year. 
33. (a) Could India provide an explanation for the delay? 
 Paragraph 97 also indicates that the pilot pr oject on risk-based supervision will continue. 
 
(b) Would India please identify if the project  will be expanded to more than 23 banks? 
 
(c) By being chosen for this project, c ould India explain if these banks enjoy an 
advantage with respect to their comp etitors (e.g. less regulatory burden)? 
 
Part IV - Trade Policies by Sector, (5) Serv ices, (iii) Financial Services, (a) Banking, 
paragraph 98, page 129: 
 
The Secretariat Report indicates that the bill to amend the Banking Regulation Act is currently in 
Parliament. Canada understands that  a similar bill was in Parliament in 2005, which was met with 
significant opposition.   WT/TPR/M/182/Add.1 
Page 82  
 
  34. (a) Would India please elaborate on any diff erences between the two proposed bills? 
 
(b) Could India clarify when this bill is expected to become law? 
 
Part IV - Trade Policies by Sector, (5) Serv ices, (iii) Financial Services, (a) Banking, 
paragraph 99, page 130:  
Paragraph 99 of the Secretariat Report indicates that  foreign banks may be permitted to enter into 
mergers and acquisitions with private banks in India,  subject to a 74% overall investment limit, as of 
April 2009. 
  
35. (a) Could India clarify whether such mergers and acquisitions would also be subject to 
any of the individual ownership limits India maintains? 
 Paragraph 99 of the Secretariat Report also indicates  that the 49% limit on private-sector banks will 
remain until 2009. 
 
(b) Does India expect that this restriction will be raised in 2009? 
 
Part IV - Trade Policies by Sector, (5) Serv ices, (iii) Financial Services, (a) Banking, 
paragraph 101, page 130: 
 
Paragraph 101 indicates that recommendations re garding corporate governance issues were submitted 
in 2002.  
36. (a) Could India please define the other recommendations in the report? 
 
(b) Would India please elaborate on if the RBI is planning to implement any of these 
recommendations in the near future? 
 
Part IV - Trade Policies by Sector, (5) Servi ces, (iii) Financial Services, (b) Insurance, 
paragraph 106, 131: 
 
Paragraph 106 indicates that foreign investment is r estricted to 26% in insurance.  In the banking 
sector, the limit is 49%.  
37. Could India please identify if there is a policy r eason for the different ownership restrictions? 
Part IV - Trade Policies by Sector, (5) Servi ces, (iii) Financial Services, (c) Securities, 
paragraph 112, page 133:  
Paragraph 112 of the Secretariat’s report states that FIIs may invest in all types of securities, but are 
generally restricted to 24% of a company’s paid-up capital.  
38. (a) Could India explain whether the 24% limit re presents an individual or aggregate FII 
investment threshold and if the limit is an  aggregate level of FII investment, could 
India indicate whether any individual FII limits apply? 
  WT/TPR/M/182/Add.1 
 Page 83 
 
 
  Part IV - Trade Policies by Sector, (5) Services,  (v) Transport, (c) Air transport, paragraphs 
150-153, pages 142 and 143:    
 
39. Canada would be appreciative if India could pr ovide detailed information about the plans of 
the Indian government to address the issue of congestion at India's main airports in the 
coming years.  
 
Part IV - Trade Policies by Sector, (5) Services, (v) Transport, (c)Air tr ansport, paragraph 156, 
page 144:  
 
40. Could India please provide detailed information about the legislative regime in place in India 
governing the foreign ownership level in Indian air carriers?  
 
Part IV - Trade Policies by Sector, (5) Services,  (v) Transport, (c) Air transport, paragraphs 
160-161, page 144: 
 
41. Could India please provide Canada with de tailed information about any recent or 
contemplated changes to India's international air policy? 
 
Part IV - Trade Policies by Sector, (5) Services,  (vi) Professional Services, (b) Legal services, 
Paragraph 171, page 147: 
 
Paragraph 171 states that "Foreign law firms ar e not permitted to open offices in India and are 
prohibited from giving any legal advice that coul d constitute practicing of Indian law."   
 
42. Could India please identify if foreign lawyers a nd law firms are able to provide advisory 
services on foreign and international law on a cross-border basis, provided that they are 
qualified and licensed to practice these types of law in their home jurisdiction? 
 
Part IV - Trade Policies by Sector, (5) Services,  (vi) Professional Services, (b) Legal services, 
paragraph 172, page 147: 
 Paragraph 172 states that "Legal services can be pr ovided only by natural persons who are citizens of 
India, and who are on the advocates roll in the state where the service is being provided."    
43. Could India please explain if this restriction is  limited to the practice of domestic (Indian) 
law, or does the nationality/citizenship requirement  also apply to a foreign lawyer who wishes 
to provide foreign legal consultancy services (advisory services on foreign and international 
law in India), provided they are qualified and li censed to practice these ty pes of law in their 
home jurisdiction?   
 
Appendix Tables, Table AIII.2, “ Tariff Rate Quotas Issued, 2002/03-2006/07”, page 178: 
 
Although a tariff rate quota (TRQ) of 150,000 MT exis ts at 45% import duty for canola oil, Canadian 
exporters are unable to access this quota. In fact , as illustrated in AIII.2, this quota has not been 
utilized at all since 2002/03. 
44. Could India please explain the process for accessing the canola oil TRQ?  
   
India ratified the Cartagena Protocol on Biosafety (BSP) in 2003. Canada would be interested in 
finding out what India's plans are with respect to  implementation of its obligations under the BSP. 
 WT/TPR/M/182/Add.1 
Page 84  
 
  45. Will India be notifying the WTO once any new regul ations with respect to its BSP obligations 
are developed? 
 
SUPPLEMENTAL QUESTIONS FROM THE GOVERNMENT OF CANADA ON 
AGRICULTURAL BIOTECHNOLOGY  
 Report by the Secretariat (WT/TPR/S/182)
 
 
Part III – Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xiii) 
Labelling, paragraph 65, page 56: 
 
Paragraph 65 of the Secretariat’s report (WT/TPR/S /182) refers to a draft regulation (GSR 152(E)) 
which would put in place a comprehensive labelling re quirement for genetically modified food. When 
India first notified this proposed regulation to the WTO in 2006 as notification G/TBT/N/IND/12, 
Canada posed questions which Canada woul d like ask again at this juncture.  
 Canada notes that while the draft notification provi des a definition of “genetically engineered and 
genetically modified foods,” the text of the notifi cation makes use of the term “genetically modified” 
and does not make use of the term “genetically engineered”. The terms genetically modified and 
genetically engineered organisms are not synonymous.  
 
1) (a) Could India please explain how it defines “genetically modified” and how does India 
define “genetically engineered”? 
 
(b) Could India please provide more information regarding the timetable for 
implementation of regulation GSR 152(E)? 
 In addition, Canada would like to know more about  the changes notified to the WTO via notification 
G/TBT/N/IND/17 and regarding the regulation of imports of Genetically Modified Food, Feed, 
Genetically Modified Organisms (GMOs) and Living Modified Organisms (LMOs). 
 
2) Could India please provide more detailed information on the changes notified to the WTO 
and the regulation of imports of Genetically Modified Food, Feed, Genetically Modified 
Organisms (GMOs) and Living Modified Organisms (LMOs)? 
 
In reference to Condition No. 18(d) in Paragr aph 4 of Notification No. 2(RE-2006)/2004-2009, 
Canada notes that India may encounter difficulties in the implementation of this requirement for 
processed products, such as oils. Refined oils cont ain residual DNA and denatured protein resulting in 
difficulty in detecting these analytes. Protein- or DNA-based detection methods may also be difficult 
to implement successfully for other highly processed food products.   
3) Could India please explain how it India proposes to implement this requirement? 
  QUESTIONS FROM NORWAY
  
 Question 1: 
 
Paragraph 133 (p.28) of the Government  Report (WT/TPR/G/182) indicates that a 
comprehensive amendment to the Insurance Act is envisaged. Norway would appreciate if India could 
provide more details on the elements likely to be included in such an amendment. In particular, 
Norway would be interested to know whether Indi a plans to allow cross-border supply of insurance  WT/TPR/M/182/Add.1 
 Page 85 
 
 
  for large commercial risk for relatively sophisticated  consumers, for instance within marine, aviation 
and transport insurance.    
Question 2: 
 
"In para 142 it is said that "carriage of government cargo remains reserved first for the 
Shipping Corporation of India (SCI), then for vessel s chartered by the SCI". We would like to receive 
an explanation on the coverage of the definitio n of government cargoes, and if it has a broader 
coverage than would be provided for by GATS ar ticle XIII on government procurement. Could you 
also provide information on the cargo volumes carried  by SCI under these rules in volume terms, and 
as a percentage of total seaborne import/export to India.  
  
Question 3: 
 
We would also appreciate information on any othe r flag preferences for India flagged vessels, 
including information and explanation on the polic y applicable in relation to FOB/FAS (Free On 
Board/Free Alongside Ship) import and export, and how this affect  the ability for Indian importers/exporters to choose transport alternatives."  
  
QUESTIONS FROM CHILE
 
 1. ENTORNO ECONÓMICO. Política industrial.  Reducción del número de productos 
reservados a las pequeñas empresas . Párrafo 26. Página 14.  ¿Podría India entregar antecedentes 
sobre los fundamentos de la decisión de disminui r el número de productos cuya producción estaba 
reservada a las pequeñas empresas?  
 
2. ENTORNO ECONÓMICO. (4) Evolución de las inversiones extranjeras. Párrafo 38. 
Página 18. En relación al límite de participación de capital extranjero en el sector de las 
telecomunicaciones, ¿estaría India en condiciones de elevar el actual umbral de 74%?  3. RÉGIMEN DE POLÍTICA COMERCIAL. Mecanismos que han generado "derechos 
no percibidos" por programas de fomento a  las exportaciones Párrafo 15. Página 27. Se señala 
que los derechos no percibidos como consecuenci a de los programas de fomento a las exportaciones 
aplicados en 2004-2005 se estimaron en más de 354. 000 millones de rupias (unos 7.878 millones de 
dólares).  ¿Podría India indicar cuáles fueron los principales programas de fomento a las 
exportaciones durante ese período y explicar  brevemente en qué consisten?  
 
4. RÉGIMEN DE POLÍTICA COMERCIAL. (4) Régimen de inversiones extranjeras. (ii) 
Legislación y procedimientos de aprobación. Párrafo 40.  Página 35 . ¿Cuáles son las razones que 
explican la prohibición de participación de capital extranjero en el sector de venta al por menor? 
¿Considera India la posibilidad de eliminar dicha prohibición? 
 
5. RÉGIMEN DE POLÍTICA COMERCIAL. Anexo II.I, Asistencia Técnica relacionada 
con el comercio. Párrafo 2. Página 38.   Chile desearía disponer de más antecedentes sobre la idea de 
India de crear una base de datos mundial sobre prescripciones relativas a las MSF y OTC.  6. POLITICAS Y PRÁCTICAS COMERCIALES POR MEDIDAS. Medidas que afectan específicamente a las importaciones, xi, Normas y otras prescripciones técnicas. Párrafo 48-53. 
Página 60. ¿ En qué medida las normas internacionales s on utilizadas en los reglamentos técnicos 
nacionales de India?  Chile desearía saber si los or ganismos regulatorios de India aceptan, en el área 
regulada, los resultados de la evaluación de la co nformidad efectuada por organismos de terceros 
países y que estén acreditados por organismos pert enecientes a Acuerdos de  Reconocimiento Mutuo. WT/TPR/M/182/Add.1 
Page 86  
 
  7. POLITICAS Y PRÁCTICAS COMERCIALES POR MEDIDAS, Medidas que afectan 
específicamente a las importaciones, xiii, so bre etiquetado. Párrafo 64-65. Página 64.  Chile 
desearía saber si el proyecto de reglamento referido a etiquetado de productos genéticamente 
modificados ya se encuentra vigente y acerca de la experiencia que ha significado este proceso. 
 
8. POLÍTICAS COMERCIALES, POR SECTORES. (3) Sector energético. (i) Petróleo y Gas. Párrafo 40.  Página 139 . Teniendo en consideración que en cu anto a la refinación del petróleo 
sólo el 26% de la actividad se en cuentra en manos del sector privado, ¿estaría India en condiciones de 
revisar el límite a la inversión extranjera del 26% sobre la actividad de refinación en el sector público? 
 9. POLÍTICAS COMERCIALES, POR SECTORES. (5) Servicios. (v) Transporte.  (b) 
Transporte marítimo. Párrafo 142. Página 175.  En relación a la reserva sobre el transporte de 
mercancías oficiales en favor de la Corporación de Transporte Marítimo de la India y, teniendo en 
cuenta el Proyecto de política para el sector ma rítimo presentado el año 2005, ¿consideraría India 
eliminar tal  restricción? Adicionalmente, ¿podría India entregar mayor información acerca de las 
actividades específicas que se verán bene ficiadas por la nueva política naviera?  
  
PREGUNTAS DE ARGENTINA
 
 
WT/TPR/S/182, INFORME DE LA SECRETARIA 
 II: RÉGIMEN DE POLÍTICA COMERCIAL: MARCO Y OBJETIVOS   4) Régimen de inversiones extranjeras   
 
ii) Legislación y procedimientos de aprobación  Párrafo 41, página 36 
¿Podría la India explicar cuál es el segundo mét odo al que se hace referencia en este párrafo en 
relación a la Inversión Extranjera Directa? ¿Podría  brindar estadísticas acerca de la cantidad de casos 
en los que se ha aplicado cada uno de los métodos durante el periodo bajo examen? 
 
iii) Incentivos 
 Párrafo 44, página 37 
¿Podría la India confirmar si todos los Estados del país otorgan los incentivos a las inversiones a los 
que se hace referencia en este párrafo? ¿Qué otros incentivos a las inversiones otorgan los diversos 
gobiernos estatales?  
III: POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS  
 
2) Medidas que afectan directamente a las importaciones   
 v) Contingentes arancelarios  Párrafo 33, página 51 
¿Podría la India explicar las razones por las que los contingentes arancelarios mencionados en este 
párrafo no han sido aún notificados a la OMC? ¿Tiene previsto realizar estas notificaciones? 
  WT/TPR/M/182/Add.1 
 Page 87 
 
 
  vi) Otras cargas que afectan a las importaciones 
 Párrafo 34, página 53  
¿Podría la India informar cuál es la base sobre la que se aplica el derecho adicional denominado 
CVD? ¿Con qué periodicidad se establece la tasa y cu ál es la metodología de cálculo con la que se 
establece la misma? ¿En que proporción puede variar la tasa de Estado a Estado? 
 
ix) Prohibiciones y restricciones a las impo rtaciones, y licencias de importación  
 b) Restricciones a las importaciones y licencias de importación 
 
Párrafo 40, página 56 
¿Podría la India explicar en qué consiste el mecan ismo de control a las importaciones de determinados 
productos considerados “sensibles” y cuál es el obj etivo por el cual se aplica? ¿Existe un lista 
disponible de estos 300 productos? 
 
3) Medidas que afectan directamente a las exportaciones  
 vii) Concesiones en materia de derechos e impuestos  Párrafo 91, página 76 
¿Podría la India informar cuál ha sido la tasa de devolución de derechos en los años del periodo bajo 
examen? ¿Cuáles son los requisitos que debe cumplir  el exportador para acceder a este beneficio? 
¿Son aplicables a una cantidad limitada de productos? ¿Existen diferencias en cuanto al beneficio de 
acuerdo al producto que se trate? ¿Existen dife rencias en su aplicación de acuerdo a cada Estado? 
¿Existen otros sistemas de reducción y exención fiscal además de estos últimos?  xi) Promoción de las exportacion es y ayuda a la comercialización 
 Párrafo 105, página 83 
¿Podría la India informar cuáles son los productos cuya exportación los EPC (Consejos de Promoción 
de Exportaciones) y las Juntas de Productos B ásicos están promoviendo actualmente?¿En qué 
consisten las actividades de pr omoción de estos organismos? 
 
4. Medidas que afectan a la producción y el comercio   ii) Ayuda fiscal y de otro tipo  
 
a) Política fiscal   Párrafo 130, página 94 
¿Podría la India brindar más información acerca de l Impuesto Alternativo Mínimo, particularmente la 
base de su aplicación, la metodología de cálculo y la tasa del mismo? ¿Podría informar si se han 
previsto medidas para simplificar la estructura fiscal del país? 
 
b) Subvenciones  Párrafo 138, página 96 
¿Podría la India informar a qué se refieren las s ubvenciones “encubiertas” mencionadas en el informe 
de la Secretaría?  
 WT/TPR/M/182/Add.1 
Page 88  
 
  IV: POLÍTICAS COMERCIALES POR SECTORES  
 5) Servicios   iv) Telecomunicaciones  
 
b) Reformas estructurales 
 
En el párrafo 118 , se lee “ In November 2005, foreign investment equity restrictions were increased 
from 49% to 74% in certain areas, such as fixed lin e, cellular, unified access services, national and 
international long-distance services”,  
 ¿Podría la India informar las razones por las que en 2005 se aumentaron las restricciones a la inversión extranjera en determinadas esferas del sector de telecomunicaciones? 
 
v) Transporte  
 b) Transporte marítimo 
 
En el párrafo 143 , respecto del transporte de cabotaje,  
 
¿Podría la India informar si existen inversiones extr anjeras directas para el transporte de cabotaje?  
 La tercera oración del párrafo mencionado menci ona que, “Cabotage is reserved for Indian-flag 
vessels, but foreign-flag vessels are permitted to ca rry coastal cargo when no Indian-flag vessesl is 
available” ,  
 
¿Existen casos en que se han autorizado este tipo de transporte ante la falta de disponibilidad de 
embarcaciones locales?  
PREGUNTAS ADICIONALES DE ARGENTINA
 
 
WT/TPR/S/182, INFORME DE LA SECRETARIA  III: POLÍTICAS Y PRÁCTICAS COMERCIALES, POR MEDIDAS   2) Medidas que afectan directamente las importaciones 
xii) Medidas Sanitarias y Fitosanitarias 
 Párrafo 58, página 54 
¿Podría la India especificar si el análisis de riesgo de plagas al que se hace referencia en este párrafo 
resulta exigible para cada importación del producto de  que se trate o si, por el contrario, en los casos 
en los que ya existe comercio establecido éste no se interrumpe?    Párrafo 60, página 55 
¿Podría la India definir el “período de cuarenten a” al que se hace referencia en este párrafo? ¿Cuáles 
son los motivos por los que se implementa? ¿A qué productos alcanza? En cuanto a la fumigación mencionada en el mismo párrafo, ¿en qué casos debería aplicarse?  
  WT/TPR/M/182/Add.1 
 Page 89 
 
 
  IV: POLÍTICAS COMERCIALES POR SECTORES 
 2) Agricultura  Párrafo 17, página 104 
¿Podría la India explicar en qué casos la Aduana ap lica el precio de referencia para la importación de 
determinados productos?¿Cuáles son sus fines? ¿Res ulta previsible su aplicación? ¿De qué manera se 
instrumenta?  
Párrafo 19, página 104 
¿Podría la India describir el mecanismo de implem entación de los contingentes para productos lácteos 
a los que se hace referencia en este párrafo?  
Párrafo 25, página 107 
¿Podría la India enunciar los productos que recibi eron subvenciones a través del sostenimiento de 
precios durante el período 2002-2006? ¿Podría describir cómo funciona el sistema?  
 
Párrafo 26, página 108 
¿Podría la India informar cuál fue la cuantía de s ubsidios totales (sostenimien to de precios + subsidios 
a los insumos) otorgados a productores de trigo, arroz y cereales secundarios durante el período 2002-
2006? 
 
Párrafos 27 y 28, páginas 108 y 109 
Teniendo en cuenta que la India no tiene disponibles subvenciones de  caja ámbar bajo el Acuerdo 
sobre la Agricultura ¿de qué manera garantiza la I ndia que los subsidios totales para cada producto no 
sobrepasen los niveles de mínimis?  
 
¿Podría la India informar cuáles han sido los precios  de intervención y los precios de mercado en la 
India para los principales cultivos durante el período 2002-2006? ¿Podría indicar cuáles fueron los precios de compra y de venta establecidos por el  Gobierno para cada cereal durante el período 2002-
2006?  Párrafo 29, página 109 
Teniendo en cuenta que “el agricultor tiene la opci ón de vender a los organism os de los gobiernos o 
en el mercado libre” ¿podría la India ofrecer algún ejemplo de casos en los que el agricultor hubiera 
elegido la primera opción, puesto que los precios de  intervención deben necesariamente ser inferiores 
a los de mercado, toda vez que la India no tiene MGA disponible? 
 
 
QUESTIONS FROM HONG KONG, CHINA
 
Anti-dumping (AD)  
(WT/TPR/S/182, P. ix, Para. 12, P. 49, Para. 44; and P. 51, Chart III.5) 
1. We note that India initiated fewer AD investig ations during this revi ew period but is still a 
major user of the trade remedy.  According to th e WTO statistics, 21 cases and 28 cases were initiated 
by India respectively in 2004 and 2005, and during the first six months of 2006, there were already 20 
initiations.  We would like to know whether the Indi an authorities consider this a reversal of the 
declining trend of the use of AD actions and whether there are any reasons or factors, such as changes 
of governmental policies or rules, that may lead to the recent upsurge. 
 2. We also note that the majority of AD cases of India involved chemical products, plastics, base 
metal, etc.  We are in terested to know whether and if yes ho w India would take into account the WT/TPR/M/182/Add.1 
Page 90  
 
  impact of AD measures on downstream users a nd consumers in India before initiation of 
investigations or imposition of measures.  India’s GATS Commitments
 
(WT/TPR/S/182, P. 127, Para. 91; and WT/TPR/G/182, P. 30 - 31, Para. 151) 
3. We welcome India’s introduction of a broa d number of new commitments in its initial and 
revised services offers. At the same time, we note th at for most of the services found in India’s offers, 
it has been inscribed in mode 3 of the market access column that Foreign Investment Promotion 
Board (FIPB) approval would be required in the case of foreign investors having prior collaboration in 
that specific service sector in India.  This new in scription has also been adde d to some of the existing 
mode 3 commitments found in India’s GATS schedule.   We would be grateful for India’s advice as 
to: 
(a)  how to define whether or not a foreign investor is having prior collaboration in a specific 
service sector; 
 
(b)  the rationale behind for imposing the requirement in the case of foreign investors having 
prior collaboration in a specific service sector; and 
 
(c)  whether the granting of the relevant approva l by FIPB entails any market access or national 
treatment limitations. 
 
Banking  
(WT/TPR/S/182, P. 129, Para. 98) 
4. As noted from the Secretariat Report, it seems  that a Bill will be introduced to abolish the 
restriction on the 10% ceiling in respect of: (a) the paid-up capital of a private sector bank to be 
owned or controlled by a single entity; and (b) voting rights of an individual. We would be grateful 
for India’s advice on the latest progress of the B ill and the expected timeframe for the passage and 
enactment of the Bill.   
(WT/TPR/S/182, P. 130, Para. 99, Footnote 138; and WT/TPR/G/182, P. 25 - 27, Paras. 119 - 126) 
5. We note from the Secretariat Report and India’s existing GATS schedule that both new 
entrants and existing banks are subject to a limit of twelve licences per year, whereas in India’s 
revised services offer the annual licence limit has b een increased to twenty. We would like to know 
whether the licence limit is actually in place under India’s de facto banking regime and if so, what the 
annual limit currently in force is.  In case a more  liberal regime is indeed in place, would India 
consider binding its existing regi me in its future services offers? 
 Insurance
 
(WT/TPR/S/182, P. 131, Para. 106) 
6. We are pleased to learn from the Secretariat Report that the Indian Government is considering 
raising the foreign investment cap for the insurance sector from currently 26% to 49%.  Would India 
share with us the latest progress of the proposed re laxation, the expected timeframe for a decision to 
be made by the Government, and the timetable for the implementation of the higher cap should a 
positive outcome transpire eventually? 
 
Telecommunication Services  
(WT/TPR/S/182, P. 134 - 135, Para. 118) 
7. As set out in the Secretariat Report, r estrictions to foreign investment in the  WT/TPR/M/182/Add.1 
 Page 91 
 
 
  telecommunication sector have been relaxed sinc e 2000, which has resulted in higher foreign 
investment caps for the different types of serv ices. Would India consider further increasing the 
relevant foreign investment caps in its future offers especially to services such as voice telephone, 
pocket switched data transmission, radio paging and cellular mobile telephone so as to align them 
with the ones actually in place?   Maritime Transport Services
 
(WT/TPR/S/182, P. 140, Paras. 140 & 143; and WT/TPR/G/182, P. 8, Para. 22) 
8. We note from the Secretariat Report that around 95% of India’s trade in good is seaborne. To 
increase the competitiveness of maritime transporta tion services, reform measures have been adopted 
(e.g. 100% foreign investment is allowed in the sh ipping sector in India). We would like to know if 
India would consider reflecting its de facto more liberal regime in maritime transport services in its 
next offer.   
9. We note that the supply of maritime auxiliary services through commercial presence under 
mode 3 could only be through Indian registered company.  We would appreciate if India could 
elaborate the requirements to be an “Indian registered company”. 
 
QUESTIONS BY PAKISTAN
 
 
NAMA:  
  
1. Beside basic customs duties, India also le vies Counter veiling duties, special counter veiling 
duties, special excise duty and education cess on importe d products. Invariably such duties are levied 
on duty paid value. Hence their impact is more th an the scheduled rate. Would India like to justify 
levy of such duties with respect to its obligation re garding 'other duty and charges" in terms of Art II 
of GATT?   2.  India is one of the competitive producers of  Textile and Clothing. However, India maintains a 
very high tariff on T&C including the levy of non ad valorem duty. Such a tariff regime raises 
questions of transparency and is likely to be used  as an instrument of protection. Could India please 
clarify and justify such trade policy measure?  
Agriculture: 
 3. Average applied rate for agriculture products is 3-4 times higher than that of non-agriculture 
products. How does India foresee its tariff reforms in this sector?  4. There are certain tariff rate quotas where impor ts have occurred but no TRQs were issued; 
meaning thereby that out-of-quota rates were paid for such imports. Can India identify the reasons for 
non-issuance of these quotas? Does India also feel ob liged to notify TRQ utilization to the WTO?  
 
5. What is the procedure for grant of G.Is or  collective trade marks? Does India take into 
consideration the international registration/use of such marks?   WT/TPR/M/182/Add.1 
Page 92  
 
  QUESTIONS AND COMMENTS FROM THAILAND
 
 
WTO Secretariat Report (WT/TPR/S/182) 
 
II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
(6) FOREIGN INVESTMENT REGIME  
 
(ii) Incentives 
Para 44: The Secretariat Report states that  the Central Government's incentives include a 100% tax 
exemption on profits for infrastructure developmen t and operation. Does this exemption also include 
profits for infrastructure maintenance?   
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(1) O VERVIEW  
Para 2:  The Secretariat Report states that Indian authorities have raised tariffs substantially on 27 
agricultural products during the period under review. Could India please identify those products, their respective tariff rates (before and after the tariff increase), and the reasons for the tariff increase? 
(2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 
(iv) Tariff exemptions 
Para 31: According to the Secretariat Report,  India has a wide range of tariff exemptions which are 
both product-specific and based on industrial use.  Could India please identify agricultural products 
that receive tariff exemptions, if any, including the reasons for such exemptions? 
(v) Tariff-rate quotas 
Para 33: The Secretariat Report indicates that “While TRQs  were not issued for some of these products 
for certain years, imports have occurred over rece nt years, presumably at out-of-quota rates.”   Please 
specify those products for which this has occurred.  Under its FTAs, has India granted quota-free status 
for any agricultural products currently subject to  WTO TRQs?  If so, could India please identify the 
product and relevant FTA? 
(vi) Other charges affecting imports 
Para 34: According to the Secretariat Report,  as of  1 March 2006, all imports are subject to a special duty 
of 4% comparable to the rates applied on domestic  products for VAT, municipal tax, market committee 
fees, etc.  Could India please explain its calculation of  this special duty and how it is equivalent to 
domestic rates? 
(ix) Import prohibitions, restrictions, and licensing 
Para 40: The Secretariat Report states that imports of certain items must be imported through specified 
ports.  Do these items include those products monito red by the committee chaired by the Department of 
Commerce Secretary? Please clarify.   WT/TPR/M/182/Add.1 
 Page 93 
 
 
  (xv) State Trading 
Para 79 and Table III.6: Indian state trading enterprises such as Food Corporation of India have 
played a key role in the importation of wheat, ri ce, maize, grain and othe r products in order to 
maintain India’s food secu rity and to enable better marketing and pricing.  Could India please 
elaborate more on the procedure of state tradi ng control over imported agricultural goods? Are STEs 
open for private bidding or do they allocate goods by themselves? 
(3) M EASURES DIRECTLY AFFECTING EXPORTS  
 
(ix) State Trading 
Para 100 and Table III.8: The Secretariat Report states that Indi an preferential sugar quotas to the 
EC and the United States are subject to state trading.   Are other Indian sugar exports also subject to 
state trading? 
(x) Export finance, insurance, and guarantees 
Paras 101-102 : India provides a range of financing products , support programmes, and export credit.  
India’s Exim Bank also provides various export guarantee schemes and fee-based services to support 
international trade and investment . Are agricultural products the ma in users of export subsidies, 
export credit, export insurance, and export guaran tees?  Does the payment program of internal 
transportation and freight charges for exporting su gar comply with Article  9.4 of AOA since the 
implementation period has expired in 2005?   
IV. TRADE POLICIES BY SECTOR 
(2) A GRICULTURE  
 
(i)  Overview 
Para 8:  According to the Secretariat Report, some factors that have dissuaded private sector 
investment include low productivity due to regulati on of agricultural markets and the movement of 
major crops.  Could India please provide more details  on how these factors have negatively affected 
private investment in agriculture, including how the movement of major crops affects agricultural 
productivity?  We would also appreciate further details on India’s land ownership ceiling laws, 
succession patterns, tenancy laws and regulation of agricultural markets. 
(ii) Agricultural policies 
 
(a) General framework 
Para 14: The Secretariat Report states that the Food Corporation of India (FCI) purchases foodgrains 
at procurement prices set by the Government and sells them at the Central Issue Price (CIP) also fixed 
by the Government. Please provide more details on procurement prices and the Central Issue Price. 
When are procurement prices and the Central Issu e Price applied? How does the government release 
the stocks resulting from procurement under mi nimum support price schemes? How does the public 
distribution system operate when the Government procures food grains?  
Para 15: As the first National Agricultural Policy’s objec tive of raising annual growth in agriculture 
are being pursued through  programmes like Bharat Nirman, we would appreciate clarification of the 
Bharat Nirman programme.  We are particularly in terested in learning more about sectors or products WT/TPR/M/182/Add.1 
Page 94  
 
  under this programme, methods or steps for ach ieving programme objectives, impact of the 
programme, and its expected duration.  
(b) Import policy 
Tariffs  
Para 17: The Secretariat Report states that India uses “reference prices” to calculate customs duty 
applicable on imports of, inter alia , palm oil (crude and RBD), palm olein oil (crude and RBD), and 
crude soybean oil.  
- When does India use “reference prices” to calcu late customs duties and when are the reference 
prices fixed by the authorities? 
- Is there any formula used to calculate reference prices?  Please provide further details, if possible, on 
the background and data source used to establis h reference prices, including from exporters. 
(d) Internal policies 
Overview 
Para 25 : The Secretariat Report states that India’s in ternal measures to support agriculture include 
direct subsidies for inputs and indirect assistan ce through price support. Could India please identify 
the most highly subsidized products under its price support programme during 2001-2006? 
Support for agricultural crops 
Para 30: The Secretariat Report states that “Procurement  of rice and sugar are subject to ‘levies’, 
which are fixed shares of output that must be sold to the Central Government at fixed prices for the 
TPDS [targeted public distribution system].”  It also states that  “Rice procured by the Government through a statutory levy on rice millers and rice de alers is fixed by states in consultation with the 
Central Government and varies from State to State.”  
Please provide further details on the above processes.  We would also appreciate, if possible, a 
detailed breakdown of the rice procurement process.   QUESTION FROM THE UNITED ARAB EMIRATES
 
 
The UAE Government has sought clarification fro m the Indian Delegation concerning the latter's 
Tariff Regulations impacting Port Services – Cu rrent Tariff setting principles in erosion of 
equity and unviable investment climate.  
 
QUESTIONS BY THE ARAB REPUBLIC OF EGYPT
 
 Related to the Report by the Secretariat (WT/TPR/S/182)
 
 
• Concerning Import License 
 I- Page 35,  III-Trade Policies And Practices By Measure, (2) Measures Directly Affecting Imports, (i) Procedures, (a) Registration and Documentation:   WT/TPR/M/182/Add.1 
 Page 95 
 
 
  Paragraph 13 states that for some imported goods "Import permits for products subject to 
restrictions and health and sanitary certificates mu st be obtained prior to import from the relevant 
Government departments and submitted along with the Customs declaration." 
 
Question:   
 
- It would be appreciated if a list of those products be provided. 
 
II- Page 46, (ix) Import prohibitions, restrict ions, and licensing, (a) Import prohibitions:  
 
Paragraph 37  states that  "Import prohibitions are maintained under Section 11 of the Customs Act 
1962.  Under the Act, the Government may, by notifi cation in the Official Gazette, impose absolute or 
conditional import (or export) prohibitions.  Such measu res can be maintained fo r, inter alia, security, 
public order and standards of decency or morality , prevention of smuggling or shortage of goods, 
foreign exchange and balance of payments reasons, prevention of ag ricultural surpluses, standards, 
intellectual property, and the conser vation of exhaustible resources."  
 
Questions:  
 - A clarification is needed on those products on which absolute import prohibitions are 
imposed, to distinguish them from those on whic h a conditional import prohibition is imposed, and 
what are the conditions calling for conditional import prohibition. 
 - Would import licences required for the importa tion of goods classified under Exim codes 
2515 11 00, 2515 12 10, 2515 12 90, 6802 10 00, 6802 21 10, and 6802 21 20 fall under the classification of imports subject to conditional prohib itions? And if so what is the reason behind such 
a measure? 
 - Would India clarify whether imports of products  falling under Exim codes  6802 10 00, 6802 
21 10, and 6802 21 20   of a cif value below USD 2700 per cubic meter, are prohi bited or not ? And if 
not, what is the basis for determining the thres hold of USD 2700 per cubic meter for free importation? 
What are the requirements for importing products falling under Exim codes  6802 10 00, 6802 21 10, 
and 6802 21 20   of a cif value below  USD 2700 per cubic meter.
6 
 
III- Page 47, (ix) Import prohibitions, restrictions, and licensing, (b) Import restrictions and licensing  
Paragraph 39 states that  "Import restrictions can be imposed under the Customs Act, 1962 and the 
Foreign Trade (Development and Regulation) Act,  1992.  Some 415 tariff lines (around 3.5% of the 
tariff) at the HS 8-digit level are currently subject to import restrictions under Articles XX and XXI of the GATT.  The items are mainly in sections 19 (arms and ammunition), 1 (live animals), 21 (works 
of art), 5 (mineral products) and 2 (vegetable products) (Chart III.4).  
 
Questions:
 
 - Where do the import restrictions imposed on goods classified under Exim codes 2515 11 00, 
2515 12 10, 2515 12 90 fit in the sections identified in (Chart III.4)? What is the basis for imposing such a restriction?  
 
                                                     
 
 6 NOTIFICATION No. 23 ( RE-2005)/2004-2009, NEW DELHI: Dated August, 2005 & No. 26 
(RE-2005)/2004-2009, NEW DELHI: Dated 2nd September, 2005. WT/TPR/M/182/Add.1 
Page 96  
 
  - What are the eligibility criteria for obtaining licences for imports of products falling under the 
above identified Exim codes? How were the fl oor prices, for which such licences are subject, 
determined and what is the basis for imposing such a requirement?   
 
Paragraph 40 states that  "India also monitors imports of some 300 items that are considered to be 
sensitive.  The monitoring mech anism was set up after the removal of quantitative restrictions on 
imports in 2002.  The products, which are monito red by a committee chaired by the Secretary of the 
Department of Commerce, include edible oil, cotton, silk, milk  and milk products, cereals, fruit and 
vegetables, spices, automobiles, tea, coffee, alcoholic beverages and products produced by the 
small-scale industry.  Imports of certain items, including second-hand cars (over three-years old) and 
imports from Sri Lanka subject to preferential tariffs  (such as tea), must be imported through specified 
ports (Mumbai for second-hand cars, Kochi and Kolkat a for tea and Chennai, Mumbai and Jawaharlal 
Nehru Port Mumbai for garments). "   Questions:
 
 
- In this  context, How would India explain th e imposition of a ceiling of 1.30 Lakh MT per 
licensing year7 on the imports of rough marble blocks  under Exim codes 2515 11 00, 2515 12 10, 
2515 12 90? What is the basis for imposing such a quantitative restriction?  - What are the items that fall in the sensitive list of the 300 products? 
 
• Concerning Government Procurement: 
 Page 34, III-Trade Policies and Practices By  Measure, (1) Overview, Paragraph (5): 
 
Question: 
 
 
- Egypt would like to know what amendments I ndia’s Central Government made in order to 
enhance transparency and competition in procurement procedures?  
 
Paragraph 5 states that  “It seems, however, that preferences remain for products manufactured by 
the small-scale sector and state-owned enterprises.  India is not a party to the WTO's Agreement on 
Government Procurement.” 
 
Question:  
  - Egypt requests more details as to the kind of pr eferences that India gives to the small–scale 
sector and the state–owned enterprises?  
 
• Concerning Trade Facilitation: 
 I- Page 35,  III-Trade Policies And Practices By Measure, (2) Measures Directly Affecting Imports, (i) Procedures, (a) Registration and Documentation: 
 Paragraph 14 states that  “The electronic data interchange (EDI) system was introduced in 
May 1995 and is applied at all major ports and air cargo complexes.  It is operational in 34 customs 
stations, and about 85% to 90% of import/export documents are processed electronically” 
 
                                                     
 
 7 Policy Circular No. 24 ( RE-05)/2004-2009 dated 30-8-2005  WT/TPR/M/182/Add.1 
 Page 97 
 
 
  Question:  
 - Egypt kindly requests India to share its expe rience on the introduction and implementation of 
EDI at ports and Customs stations, particularly in  terms of time it took to implement and effort 
(donor-assisted) or indigenous? What specifi c challenges needed to be overcome?  
 
II- Page 37, III-Trade Policies And Practices By Measure, (2) Measures Directly Affecting 
Imports, (ii) Customs valuation and clearance, (b) Customs clearance, Paragraph 18, Regarding 
Risk Management  
Question: 
 
 - In what cases (and products) does India a pply quality assessment, examination and post-
clearance audit of bills of entry selected by the RMS? What are the procedures and how long do they 
take to implement?    
Paragraph 19 (same section) states that “The RMS uses a valuation risk assessment module 
(VRAM) to use a weighted average value of  recent like imports of sensitive goods. ”   
 Question:
 
 
- Egypt kindly requests more information on the VRAM applied by India?  
 
Paragraph 20 (same section) states that  “The Appellate Tribunal must reach a decision, where 
possible, within three years from the date on which an  appeal is filed. Data on the number of appeals 
were not provided.”  
 
Question:  
 - Could India provide an approximate percentage of valuation decisions that are subject to 
appeal (this would help Egypt in evaluating the VRAM system)?Moreover, Is there any plan for 
reducing the time taken for appeal as it is one of the elements re quired in facilitating procedures under 
Trade Facilitation negotiations. 
 
Paragraph 20 (same section) also states that “An alternative channel for final resolution of 
assessment disputes, avoiding prolonged litigation, has been created under the Customs and Central 
Excise Settlement Commission.” 
 
Question:
 
 - Egypt kindly requests more details about the alternative channel for final resolution of 
assessment disputes, including the different steps involved cases where recourse to such a channel is 
permitted, whether it can be used at the beginning of the process, etc? WT/TPR/M/182/Add.1 
Page 98  
 
  ADDITIONAL WRITTEN QUESTION S AND FOLLOW-UP QUESTIONS 
SECOND DAY OF THE MEETING 
 
 
SUPPLEMENTAL QUESTIONS FOR INDIA FROM CANADA
 
 
Response to Canada Question 1:  
 
Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 56, page 54: 
 
Mention is made in paragraph of 56 of the va rious Indian WTO/SPS Enquiry Points; however, no 
information is provided regarding th e coordination among these authorities. 
 
Original Question: Could India explain how the authorities coordinate amongst themselves to 
respond to WTO SPS enquiries? 
 
India’s Reply: India has three SPS enquiry points. The Depa rtment of Agriculture and Cooperation is 
responsible for plant health, the Department of Anim al Husbandry, Dairying and Fisheries for animal 
health and the Ministry of Health and Family We lfare for human health. These Ministry/Departments 
are responsible for determining the required SPS measures. The Department of Commerce is the 
National Notifying Authority of the SPS measures.  
 The determination of SPS measures is based on a risk  analysis process so as to protect animal and 
human health of the country. The import risk anal ysis is conducted in cons ultation with technical 
experts on the basis of well recognized scientific pr inciples and with reference to the specific product 
and the disease situation prevailing in the exporting country vis-à-vis the disease situation in India. 
The same principle has be en used in the formulation of sanitary conditions for the import of cattle, 
sheep, goats, rabbits and meat products into the country. The SPS measures in force are on the basis 
of scientific principles of risk analysis and on the lines of well recognized international standards 
including those of Codex, OIE and IPPC.   Supplemental Question:
 Could India please elaborate further on how the various WTO/SPS enquiry 
points (i.e.: Department of Agriculture and Cooperation) coordinate these activities amongst 
themselves?  
 
Response to Canada Question 2:  
 
Part IV - Trade Policies by Sector, (5) Services,  (vi) Professional Services, (b) Legal services, 
paragraph 172, page 147: 
 
Paragraph 172 states that "Legal services can be pr ovided only by natural persons who are citizens of 
India, and who are on the advocates roll in the state where the service is being provided."  
 
Original Question: Could India please explain if this restriction is limited to the practice of 
domestic (Indian) law, or does the nationalit y/citizenship requirement also apply to a foreign 
lawyer who wishes to provide foreign legal cons ultancy services (advisory services on foreign 
and international law in India), provided they are qualified and licensed to practice these types 
of law in their home jurisdiction?      
India’s Reply:   India does not have information relating to any foreign lawyers or law firms 
providing advisory services on foreign and internationa l law in India on a cross border basis. Since the 
Bar Council of India has not so far recognised any foreign qualification for the purpose of enrolment  WT/TPR/M/182/Add.1 
 Page 99 
 
 
  of foreign nationals as advocates in India, any fo rm of professional legal advice or consultancy 
services provided in India by foreign lawyers, located ph ysically in India, is not permitted even if it is 
on foreign and international law.    
Supplemental Question :
  In Canada's experience, the establishment of foreign legal consultancy 
regimes has been a positive experience as this  enables Canadian companies and consumers to seek 
advice domestically from foreign legal consultants ( FLCs) with respect to other countries' legal and 
regulatory regimes where the FLC is li censed to practice as a lawyer.   
 Is the Bar Council of India considering any domes tic reform to allow foreign lawyers to provide 
consultancy services on the law in which they are qua lified to practice, with the view to allowing 
Indian companies similar access? 
 
Response to Canada Question 3 (b):
 
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, (iii) Tariffs, (a) Overview, paragraph 21, page 38: 
 
The Secretariat Report notes that in the WTO Committee on SPS Measures, “[s]ome Members also 
expressed concerns about the lateness of India's no tifications on new fumigation requirements in place 
since January 2004, as this did not allow sufficient time for comment; there was also concern that the 
measures deviated from international standards.  Non-notification of various SPS measures was also 
raised by several Members.”  
Original Question: Can India explain why several of its SPS notifications issued during the 
review period were issued several months after the measures were in force?   
 India’s Reply:  Beyond the one instance detailed out in (a) [answer provided in 3 (a) of India’s 
original responses to Canada] above, we are not aware of other ‘several’ delayed notifications. 
 
Out of the total number of India’s notifications issu ed during the review period, it appears that 13% of 
notifications were issued once in force, includi ng G/SPS/N/IND/9 (adopted July 2001, notified April 
2002, and G/SPS/N/IND/33 (in force when notified January 2006).   
 
Supplemental Question:
 Could India provide further informa tion for the reasons why several of its 
SPS notifications issued during the review period were  issued several months after the measures were 
in force?   
 
Response to Canada Question 7:  
 
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (a) Standards, paragraph 52, page 52: 
 The Secretariat Report notes that BIS develops sta ndards through 14 Division Councils and that draft 
standards are published for comments on the BIS website for not less than one month.  
Original Question: Could India please identify the policies BIS has in place to ensure that a 60 
day comment period is provided for all draft st andards as stipulated by the Code of Good 
Practice (Annex 3 of the TBT Agreement)?  
India’s Reply:  A mechanism has been instituted so as to provide comments on the draft notifications 
within 60 days. BIS is the coordinating agency for that.    WT/TPR/M/182/Add.1 
Page 100  
 
  Supplemental Question:
 Could India please expand upon its reply regarding what policies BIS has in 
place to ensure that a 60 day comment periods is prov ided for all draft standards as stipulated by the 
Code of Good Practice (Annex 3 of the TBT Agreement) . What is the nature of the mechanism in place 
and how does it function? Where are the draft standards published and how can interested parties 
from other Members ensure that they are aware of their publication? 
  
Response to Canada Question 10 (a):  
 
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (b) Pr oduct Certification, paragraph 54, page 52: 
 According to the Secretariat Report, BIS operates as both a standards development organization and a 
certification program under which it manages the application of the Bureau of Indian Standard Mark (ISI). The ISI mark is granted to products both on a voluntary and mandatory basis. There are 66 products which must receive ISI certification due to health and safety concerns (i.e. where its 
application is mandatory). Manufacturers, including foreign manufacturers, are able to apply the ISI 
mark if they have been certified by BIS. And,  BIS has been designated as a National Certification 
Body for recognizing and issuing certificates under the IECEE CB Scheme.  
Original Question: Could India explain how BIS’ standards development body and its 
conformity assessment body operate as distinct , separate and independent entities in keeping 
with international best practices for good governance?   
India’s Reply:  The standards development wing and its  conformity assessment body of BIS are 
distinct, separate and independent entities.   
  Supplemental Questions:
 Could India please provide further details on how the separation of BIS' 
standards development and conformity  assessment bodies is achieved?  
 Are they completely separate entities?   If so, are they separate legal entities with comp letely different management structures and executives? 
  
Response to Canada Question 10 (b):
 
 
Original Question: Could India indicate if BI S has been accredited to ISO/IEC Guide 65, the 
international conformity assess ment standard for bodies operating product certification 
programs?  
 
India’s Reply:  The product certification scheme being opera ted by BIS is as per ISO/ IEC Guide 65. 
The scheme has not been accredited to ISO/ IEC Guid e 65. However, steps are being initiated to get 
the scheme accredited to ISO/ IEC Guide 65.   Supplemental Question:
 Canada welcomes the news that BIS is taking steps to be accredited to 
ISO/IEC Guide 65.  Could India provide further de tails on the steps it is initiating and their timelines 
for completion? 
 
Response to Canada Question 11:  
 
Part III - Trade Policies and Practices by Measur e, (2) Measures Directly Affecting Imports, (x) 
Contingency Measures, (a) Anti-dumping and countervailing measures, Measures, paragraphs 41-
49, page 49:  
   WT/TPR/M/182/Add.1 
 Page 101 
 
 
  With respect to the use of anti-dumping and counte rvailing duty measures, Canada observed that the 
number of trade remedy cases being initiated by India continues to be very high and injury findings 
are very high in relation to the number of cases in itiated. Canada also suggested that in certain 
sectors India suffers from inefficiencies due to infr astructure bottlenecks, high input and freight costs 
and the high cost of capital.   Original Questions:   (a) Could India explain to what extent these factors, or economic factors other than imports, are taken into consideration during the injury phase of trade remedy investigations?  
 
(b) In addition, do Indian authorities see a correlation between efforts to address these 
problems and the number of trade remedy investigations being initiated?   (b) Could India comment on the relationship between tariff levels and the number of trade 
remedy complaints and investigations?  
 (b) Finally, do Indian authorities see a decline in the number of investigations in the short 
and medium terms?    
India’s Reply: In all anti-dumping investigations, any factor, including economic factors which may 
be contributing to injury of the domestic industr y are examined.  The measures are imposed only after 
the Authority is satisfied that there is a causal li nk between dumped imports and injury caused to the 
domestic industry.  There does not appear to be any co-relation between  factors causing injury to the domestic industry 
and number of trade remedy investigation being initiated. 
 In India, tariff levels are falli ng consistently and there is no co-relation between trade remedy 
investigations initiated in India with the changing tariff levels. 
 
Supplemental Question:
 Canada is still interested in knowin g the reason or reasons for the high 
number of trade remedy investigations being initiated by India and the high percentage of affirmative 
injury findings in such investigations. Could India please elaborate further?    
 
Response to Canada Question 16(b):  
 
Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 57, page 54: 
 
The Secretariat’s Report states that, “in an attemp t to streamline SPS procedures and enforcement, the 
Food Safety and Standards Act was passed by Parlia ment in August 2006, although it is yet to be 
enforced”.  
 
Original Question : (b) Will India be implementing regulations to enforce the legislation? 
 
India’s Reply  : The various provisions of the Food Safe ty and Standard Act, 2006 will be brought 
into effect through the notifications. 
 
Supplemental Question : Could India clarify whether the notifications referred to are notifications to 
the WTO SPS Committee? 
 WT/TPR/M/182/Add.1 
Page 102  
 
  FOLLOW-UP QUESTIONS FROM JAPAN (25
TH MAY, 2007)  
 
1. Question 4 
  Japan asked the following written question to In dia: ‘While India’s average applied rate on 
non-agricultural products in 2006/2007 is 12.1% as a result of the tariff reductions, the average bound 
rate for non-agricultural products is  34.7%. In addition to the discrepancy between the applied and 
bound rates, low binding coverage for non-agricultura l products (71.6%) is not predictable. In terms 
of predictability, it is favorable to reduce as much  as possible the discrepancy between the applied and 
bound rates and to increase the coverage.’  
 
 While this question intends that the wide ga p between the applied and bound rates and the 
low binding rate should be improved in light of da maging the predictability remarkably, we have not 
received a sufficient reply to this question. 
 
 In this light, could India indicate specific view on the improvement of the wide gap between the applied and bound rates and the low binding rate? 
 
2. Question 9 
 
 Japan would like to know whether India has any law or notification regarding the export tax 
measures on iron ore and chromium ore since March 1, 2007. If yes, Japan would like India to provide them.  
 
3. Question 12 
 
Please provide the information on the governmental regulation regarding the remittance of royalty. 
 4. Question 14 
 
 It seems to Japan that India’s reply is relate d only to Question 14(6) in respect of “action for 
infringement of trademark”. Japan would also like to be informed of the “protection of trade secrets”.  
  From this point of view, please reply to Qu estion 14(1)-(5) and provide  clear explanation on 
the protection of trade secrets.  
 
5. Question 17 
 
 As Japan has not received the answer to Questi on 17, Japan would appreciate an answer to the 
question from India.  
 
6. Question 21(2)  
  While Japan requested India to provide deta iled information on the “security bet”, Japan is 
concerned that the answer from India does not  respond to Japan’s question sufficiently.  
 
 In this regard, could India clarify what kind of criteria and requirements regarding the 
“security bet” are specified in the license conditions? 
 
7. Question 23(2) 
  While India explained in its written answer th at no services suppliers are designated as major 
suppliers, Japan would like to clarify the following points:   WT/TPR/M/182/Add.1 
 Page 103 
 
 
   (1) Are there any regulations, including desi gnating criteria specific to major suppliers, 
even if no services suppliers are designated as major suppliers right now? 
 
 (2) Are there any suppliers who control essen tial facilities and any regulations for such 
services suppliers? 
 8. Question 24(2)  
 While India explained in its written answer th at a denial of licenses is based on well-founded 
reasons, Japan would like India to clarify the following points:   
 (1) Are there any regulations requiring that reasons for the denial of licenses be made 
known to the applicant? 
 
 (2) If no, are there any plans to introduce regulations to set down “making publicly 
available the period of time normally requi red to issue a licenses” and “responsibility 
to provide reasons for denial of licenses”? 
 
 WT/TPR/M/182/Add.1 
Page 104  
 
  REPLIES PROVIDED BY INDIA 
 
SINGAPORE
 
 
1. Re WT/TPR/S/182 page 98, "India charges a 4% special additional duty (also known as 
special countervailing duty) to bring the overall tax rate on imported goods more into line with that 
on domestically produced goods, which are subject to internal taxes, such as VAT, municipal tax, 
“market committee fees”, etc.”  Could India explain how the equivalence between  the special additional duty and “domestically 
produced goods, which are subject to internal taxes,  such as VAT, municipal tax, “market committee 
fees”, etc.” is established?  Has India imposed this measure in the past? If so, what was the duty rate?  If there was a change in 
this duty rate over the years, what  was the reason for this change? 
 
Is this special additional duty applicable for all products? On what conditions could this duty be 
exempted?    
Reply:  The special additional duty is charged at 4% as  against the general VAT rates varying between 
4% - 12.5%.  Those goods, which are exempted from  VAT, are also exempt ed from this special 
additional duty.  There is thus no equivalence be tween the 4% special additional duty and VAT rates 
since it is charged at the minimum of the VAT ra tes whereas, domestic goods are subjected to a 
number of provincial and local taxes, such as inter state sales (CST), taxes on purchase or transportation, and thus cumulativ ely are taxed at even more than the general VAT rates of 4% - 
12.5%. 
 
 Earlier also the Government had imposed a special additional duty of 4% in 1998 which was 
withdrawn in January 2004. The difference betw een the present special additional duty and earlier 
special additional duty is that Government has pe rmitted credit of special additional duty imposed 
now for payment of excise duty on finished goods.  
 There are a number of exemptions from special  additional duty. Products  exempt from special 
additional duty are listed in notification No. 20/2 006-Customs, dated 1.3.2006 (may be viewed at 
www.cbec.gov.in.).   
2. Re WT/TPR/S/182 page 125,  “although the excise duty on computers is 12.5%, exemptions 
are in place for microprocessors for computers, har d disc drives, floppy disc drives, CD Rom, DVD 
drives, USB flash memory and combo drives, as  well as parts, components, and accessories for 
mobile handsets including cellular phones”.    Could India, a WTO Information Technology Ag reement (ITA) participant, explain why an excise duty 
of 12.5% is imposed on computers, while exemptions  are provided for other products covered under 
the ITA?   
 Would such a tariff measure be considered a form of tariff escalation?  
Reply:  Excise duty is charged on computers at 12%, whic h is different from customs duties (tariffs). 
On imports of computers the tariff is zero, but additional duty of customs of 12%, equivalent to the 
domestic central excise duty (CENVAT) is also charged.   Such internal taxes do not form part of the 
tariff.   WT/TPR/M/182/Add.1 
 Page 105 
 
 
   Government has given exemptions to certain part s of computers from excise duty.  This is to 
ensure that the total input taxes do not exceed the total CENVAT payable on the computers as there is 
no scheme for refund of accumulated credit.   Domestic  taxes, which are charged at the same rate on 
imported products, do not violate any WTO obligations.  3. Re Para 87 of the Secretariat Report, I ndia maintains export prohibition under Foreign 
Trade Policy for environmental, food security, ma rketing, pricing and domestic supply reasons and to 
comply with international treaties. We also note that since 2002, India had added a few more products to its list of prohibited exports.  
It would be useful if India could clarify how its  export prohibitions tally with GATT Art XI which 
generally prohibits import and export restrictions  except under a few pre-defined situations?  
 
Reply:  In the Foreign Trade Policy the prohibition and restriction on exports are given in Schedule II 
of ITC (HS) Classifications of Export and Impor t Items.  From the entries given under various 
Chapters of Schedule II, it is clear that the restric tions are imposed on the basis of environmental, wild 
life, food security, international treaties and with resp ect to special chemicals, organisms, materials, 
equipment and technology.  Of late restrictions have also been imposed on the exports of certain 
commodities like pulses, milk powder etc., in view of food security reasons. These cases are covered 
under Para 2 (a) and 2(b) of Article XI of GATT  4. We note that services have been playing an increasingly important role in the Indian economy.   It is notable that average annual growth over the past four years has been 9.8% largely 
due to reforms in certain sector such as fi nancial services and telecommunication services.   
However, as noted by the Secretariat, infrastructu re remains a major bottleneck.   In this connection, 
we note that infrastructural services such as Ma ritime and Port Services continue to suffer from 
inefficiencies and constitute a ma jor impediment to trade.  
It would be useful if India could elaborate on its  plans to reform infrastructural services such as 
Maritime Transport Services. In particular, does Indi a envisage greater liberalization in such sectors 
to facilitate greater competition and efficiency?   
Reply: Review/liberalization of Government policies is an ongoing process that takes into account 
various relevant aspects pertaining to the specific se ctor.  As far as the Maritime Transport Services 
Sector is concerned, Government policies in this Sector are quite liberal.  100% FDI is allowed on the 
automatic route in this sector. Public private part nership with Indian and foreign companies is the 
preferred route for the development of new terminals at the ports on BOT basis.  Further, the Dredging Policy also allows for participation of both Indian and foreign companies.  
 
NEW ZEALAND
 
 
Q.1. India’s report (WT/TPR/G/182, page 5, paragraph 2) notes that the growth rate in Indian 
agriculture has fluctuated sharply, from 10% in 2003-04 to 0% in 2004-05 and an estimated 2.7% in 
2006-07 (also noted on page 13, paragraph 48).  Can India comment on the factors that have 
contributed to this variation in growth and outline  its policies to reform agricultural production?  In 
particular, could India explain how high agricultural tariffs will cont ribute to improved agricultural 
growth (page 13, paragraph 48)?   
Reply:  Indian  agriculture is operated under diverse clima tic situations involving different cropping 
systems.  Apart from landless agricultural labourer s, it supports about 120.82 million farm families 
most of whom are resource-poor, sm all and marginal. About 60% of ne t sown area is not irrigated and 
depends on the monsoons. Deviations in food grains and agricultural output from its long-term trend WT/TPR/M/182/Add.1 
Page 106  
 
  are determined by, among other factors, variations  of monsoon around its long- term trend and weather 
aberrations. Furthermore, the negative impact of excess rainfall (compared to Long Period Average) 
on such output appears to be not as high as the a dverse impact of deficient rainfall. With this 
asymmetric response of foodgrains production to monsoon variability, the repetition of deficient 
rainfall in the monsoon in 2002, 2004 and 2006 during the Tenth Five Year Plan has led to poor 
agricultural growth.  
 The following steps are being taken to improve agricultural growth during 11
th Plan period: - 
 
(i) Accelerating the production and productiv ity of major food crops on regionally 
differentiated basis. 
(ii) Development of rainfed and dry land ar eas through watershed management, more 
efficient water use and ground water recharge. 
(iii) Revamp of agriculture extension system to improve delivery       mechanism at the 
grass root level. 
(iv) Focus on farmers’ welfare through risk mitig ation, and better social security system. 
(v) Greater role for the Panchayati Raj Institutions.  
(vi) WTO compatible input support to resour ce poor small and marginal farmers to 
improve their access to quality inputs and technology. 
(vii) Easy and timely availability of institutional cr edits to farmers at a reasonable rate of 
interest. 
(viii) Agricultural marketing reforms to create pos t-harvest and marketing infrastructure, 
including grading, packaging, transportation and storage facilities.  
(ix) Thrust on improving quality of rural connectivity through programmes like Pradhan 
Mantri Gram Sadak Yojna (PMGSY). 
(x) Improving potential for irriga tion through new projects and more efficient utilisation 
of water.  
 
 Trade policy is complemented by other policies in order to improve agricultural growth and 
productivity and to safeguard the livelihood of a bout 60 per cent of the population dependent on 
agriculture.  
Q.2. The Secretariat’s report (WT/TPR/S/182,  page 5, paragraph 9) and India’s report 
(WT/TPR/G/182, page,14, paragraph 57: Major Challenges to Grow th: Skill Deficit in Manpower) 
refers to India’s demographic profile and the grow ing shortfall in suitable professionals. India’s 
report suggests that a major reform of all levels of education is required.  Could India comment on the nature of reforms requi red and the implications for private and overseas 
education providers which may wish to operate in India?  
Reply:  A projected shortage of suitable professionals is proposed to be met through increasing  the 
capacity of Higher Education institutions, particularly  in professional education and in capacity at the 
level of polytechnics for developing skilled human re source. There is no bar on private investments in 
Higher Education. Foreign Direct Investment (FDI ) is allowed in this  sector without any cap. 
However, all investments are subject to the current National Policy which does not allow the 
education sector to be used for commercial purposes or profiteering. Educatio nal institutions have to 
be necessarily established  by not- for- profit societies or charitable trusts.   The Indian private sector has been establishi ng educational institutions within the existing 
policy paradigm. However, there is a need to incr ease public outlays in higher education so as to 
enhance access by making it more affordable to all sections of the society, including its marginalized 
sections. Indian institutions are already allowed to  undertake joint collaboration in research and to  WT/TPR/M/182/Add.1 
 Page 107 
 
 
  enter into a MOU with accredited foreign institutions of high repute. A draft legislation on regulating 
the entry and operations of Foreign Education Provi ders is under consideration of the government.   
 
Q.3. The Secretariat’s report (WT/TPR/S/182, page 41 , paragraph 28) refers to reductions in India’s 
average tariff on non-agricultural pr oducts to 12.1%, whereas the average tariff for agricultural 
products is 40.8%.  New Zealand welcomes India’ s moves towards gradual tariff reform to reduce 
barriers to imports.  How does India plan to level out tariffs in the agriculture sector proportionate to 
other products?   Q.4. The Secretariat’s report (WT/TPR/S/182, page 33, paragraph 2) states the gap between bound 
and applied rates continues to grow, and that th e bound rates are high, especially for agricultural 
products.  This leads to uncertainty for importers.   Indeed, during the period under review, tariffs 
were substantially raised on 27 agricultural produc ts.  Can India comment on the rationale behind 
such increases?  
 Reply: During the Uruguay Round, developing countries were given the option of binding tariffs at 
ceiling levels.  The ceiling bindings of 100% for primary products, 150% for processed and 300% for 
some edible oils were, accordingly, notified to  the WTO. All previously unbound tariffs were bound 
at the aforementioned levels.  Proportionality or parallelism of agricultural tariff commitments with 
those of other products was not established in th e Uruguay Round.  Calibration of applied tariffs – 
upwards or downwards – within bo und levels is done to meet the objectives of food security and price 
stability and to maintain publicly-held buffer stocks, without jeopardizing the interests of about 60 per 
cent of the population dependent on agriculture for livelihood the vast bulk of whom are low-income and resource-poor.  
Having regard to its food security, livelihood secu rity and rural development needs, the G-20 
of which India is a Member, has already proposed  substantial overall bound  tariff reductions across 
agricultural products of a maximum of 36 per cent, provided these are two-thirds those that may be 
committed to by the developed country Members,  coupled with appropriate flexibilities through 
Special Products and the Special Safeguard Mechanism,  as a part of the outcome of the Doha Work 
Programme. 
 
Q.5. The Secretariat’s report (WT/TPR/S/182, page 44, paragraph 33) notes that tariff-rate quotas 
(TRQs) are maintained on 14 tariff lines at the HS 8-digit level – but that some of these quotas have 
not been implemented in recent years.   For example, milk powder is subject to a TRQ (in-quota rate 
for up to 10,000 tonnes per year) but imports ha ve occurred in 2004 (233,629 kg) and 2005 (243,798 
kg) (see footnote 21, page 44).  Can India clarify  whether imports on these 14 tariff lines have had 
out-of-quota tariff rates applied to them; and, if so, the reason behind the non-application of the 
TRQ?    
Reply:  Quotas are allotted to desirous importers  based on their requests or expression of 
interest(which is market driven).Customs data on th e tariff applied to imports of items for which there 
is either a TRQ or for which there is some other tariff preferences/concession scheme  is not available.  
 Q.6. The Secretariat’s report (WT/ TPR/S/182, page 44, paragr aph 34) states that in relation to tariffs, 
import duties vary from state to state for certain product s.  We note that this is the case for wine.  Can 
India explain why it allows fo r this variation and how it plans to address the issue?  
 Reply:  Under the Constitution of India, the powers to  levy and collect exci se duty on wines and 
spirits vest with the State Governments.  In pu rsuance of this, State Governments have prescribed 
varying rates.  The Union (Central Government) h as no powers to decide the rates of excise duty on 
wines and spirits in different States.   WT/TPR/M/182/Add.1 
Page 108  
 
  Q.7.  The Secretariat’s report also outlines the imposition of additional duties and special additional 
duties (WT/TPR/S/182page 33, paragra ph 1; page 44, paragrap h 34,).  Are there plans to simplify the 
import duty structure?  
 
Reply:  As part of economic reforms, tariffs have been lowered substantially in recent years. The tariff 
structure has also been simplified considerably. However, this is an on-going process. The present 
duty structure is simple though there are certain exem ptions. It is Government’s  endeavor to gradually 
remove exemptions which are no longer rele vant in the changed circumstances.  
 
Q.8. The Secretariat’s report (WT/TPR/S/182, page 47;  paragraph 40) notes that India monitors the 
imports of some 300 items considered to be sensiti ve.  Could India elaborate on the nature of this 
monitoring and any implications for import levels and policy?   
Reply:  The sensitive list of imports is monitored on a monthly basis to track any undue surge in 
imports. The analysis arising out of such monitori ng is used as an input for policy formulation and 
periodical review.  
 
Q.9. The Secretariat’s report (WT/TPR/S/182, page ix, paragraph 12 and pages 53-56, Section xii) 
states that India’s SPS procedures are being stream lined, notably with the passage of the Food Safety 
and Standards Act in 2006 to consolidate 13 separate la ws relating to SPS issues; in addition, a risk 
analysis process has been put in place since 2004.    New Zealand welcomes India’s moves to 
consolidate its SPS procedures. 
 Questions:  (1) Would India be willing to outline key elements of  its process for determining SPS measures on 
imported products? 
 
Reply:  If any new standard or any amendment to the existing standards of any specified category of 
food is considered, a draft notification is issued givi ng the changes. This draft notification is uploaded 
on the website of the Ministry of Health  and Family Welfare (MH&FW) (website: 
http://mohfw.nic.in) for inviting comments. The draft notification is also sent through the Department 
of Commerce to the WTO for inviting comments from the WTO members. Comments thus received 
from the domestic stakeholders as well as from th e WTO members are considered by the MH&FW. 
After taking into account the comments so received, the final notification is issued. This notification is 
also uploaded on the website of MH&FW, and is communicated to the WTO. 
 
(2) New Zealand has asked India on a number of occasions for their risk analyses for dairy and 
meat products, but has yet to receive this in formation. Would India be willing to make 
available their risk analyses which were used to  determine the sanitary import conditions for 
meat and dairy product imports? 
 
Reply:  This can be considered.  
 (3) With the consolidation of India’s laws fo r food, what processes and standards that are 
applied to imports, are also required of their domestic industries? 
 
Reply:  Same standards, as applicable to domestic  industries, exist for imported food items under 
Indian regulations. 
 
India’s report (WT/TPR/G/182, page 33, paragraphs 162-165)  notes that the rising incidence of non-
tariff barriers, in the form of sanitary and phyto sanitary (SPS) measures and technical barriers to 
trade (TBT)  has emerged as a major trade concern , particularly as such new measures very often  WT/TPR/M/182/Add.1 
 Page 109 
 
 
  have market access implications.  New Zealand not es India’s concerns regarding restrictive access 
for its exports due to certai n SPS and TBT measures.  
 (4) Could India comment on how it has ensured t hat its own SPS measures are consistent with 
international standards and do not unfairl y restrict access to the Indian market? 
 
Reply:  The SPS measure(s) in force are based on scientif ic principles of risk analysis and on the lines 
of well recognized international standards including those of codex, OIE etc.    The determination of SPS measures is based on a risk analysis process so as to protect the 
animal and human health of the country. The import risk analysis is conducted in consultation with 
technical experts on the basis of well recognized scientific principles and with reference to the 
specific product and the disease situation prevailing in the exporting country vis-à-vis the disease 
situation in India.  
 India has provided to New Zealand from time to time the sanitary conditions related to the 
import of dairy and meat products into the country. The sanitary conditions have been formulated in 
consultation with technical experts on the basis of well recognized scientific principles and also 
considering the disease situation in India as well as prevailing in the other countries. India has requested New Zealand in March, 2007 to provide ce rtain information related to their observation on 
India’s sanitary conditions for dairy,  which are yet to be received.  
 Q.10. The Secretariat’s report (WT/TPR/S/182, p ages 63-64, paragraph 90) comments that India 
believes that SPS measures maintained on mango im ports into the United States, Australia, and New 
Zealand, are a barrier to its exports.  Can India elaborate on its concern?  
 
Reply:  The process of Pest Risk Analysis being conducted by some of the countries in regard to 
Indian request for market access for mango exports  has taken unreasonably long time, thus delaying 
the exports. The Pest Risk Analysis for mango exports  to one country has been finalized only recently 
after 18 long years of deliberation and exchange of information. India desires to have speedy progress 
from New Zealand on this issue. India also believes that the acceptable level of risk has been defined 
too stringently by New Zealand  and could not be justified scientifically.  
 
Q.11. The Secretariat’s report (WT/TPR/S/182, pag es 79-80, paragraphs 137 and 138) notes that the 
largest direct subsidy to producers is provided fo r food (security) and that additional agriculture-
related support is provided in the form of fertiliz er subsidies and price support.  The Secretariat notes 
that the growing subsidy bill has been at the de triment of public investment in infrastructure and 
research and development.  Does India intend to reform, as the Secretariat suggests, the way that the 
food and fertilizer subsidies are targeted, and th e method of setting minimum support prices for 
certain agricultural products?   
Reply: The subsidies being given by India in the agri culture sector are mostly directed to the low-
income and/or resource-poor farmers and  to ensure  food security to the more vulnerable sections of 
the society. However substantial improvement in i nvestment in agriculture research, technology and 
infrastructure is proposed during the 11
th Five Year Plan to improve productivity and growth in 
agriculture. The strategy for the 11th Plan includes : 
 
(i) Accelerating the production and productivit y of major food crops on regionally 
differentiated basis. 
(ii) Development of rainfed and dry land areas through watershed management, more 
efficient water use and ground water recharge. 
(iii) Revamp of agriculture extension system to improve delivery mechanism at the grass root 
level. WT/TPR/M/182/Add.1 
Page 110  
 
  (iv) Focus on farmers’ welfare through risk mitig ation, and better social security system. 
(v) Greater role for the Panchayati Raj Institutions.  
(vi) WTO compatible input support to resource poor  small and marginal farmers to improve 
their access to quality inputs and technology. 
(vii) Easy and timely availability of  institutional credits to farmers at a reasonable rate of 
interest. 
(viii) Agricultural marketing reforms to create post-harvest and marketing infrastructure, 
including grading, packaging, transportation and storage facilities.  
(ix) Thrust on improving quality of rural conn ectivity through programmes like Pradhan 
Mantri Gram Sadak Yojna (PMGSY). 
(x) Improving potential for irrigation through new projects and more efficient utilization of 
water. 
 
Q.12 The Secretariat’s report (W T/TPR/S/182, page 99, paragraph 2) suggests that the demand for 
“essential commodities” is declining in favour of vegetables, milk and meat and that a major 
reorientation is required in the Government’s agr icultural policy.  Could India comment on the 
prospects for any major change in India’s agricu ltural and trade policy given the changing demand 
for agricultural commodities?   
Reply: The shifts in demand from essential commodities in favour of vegetables, milk and meat etc. 
are reflected in the production responses. Duri ng the last few years horticulture, livestock and 
fisheries have registered an incr ease in their share in the total pr oduction of agriculture and allied 
sector. As a policy measure, the Government of In dia has also established National Horticulture 
Mission. Similarly, various development programm es/schemes are being implemented for increasing 
the production of livestock, pou ltry and fisheries to meet the increased demand for milk, meat, egg 
and livestock products. Food security, livelihood secur ity and rural development needs, among others, 
would continue to guide India’s agricultural trade policy regime.  
Q.13. The Secretariat’s report (WT/TPR/S/182,  page 102, paragraph 10; also page 102, 
paragraph 10) states that subsidised inputs such as fertiliser, water, and power have, in some cases, 
led to overuse and problems of water-logging and salinity, as well as degradation of natural 
resources, and notes that there appears to be little c hange to the basic policy of supporting producers 
by subsidising inputs through direct  subsidies.  What actions does India intend to take to mitigate 
these effects, including acti ons on supporting producers? 
 
Reply: On fertilisers, integrated nutrient management is a stated objective of the Government of 
India. In pursuance of the same, sev eral initiatives are under c onsideration to ensure that there is not 
an excessive use of a particular type of chemical fertilisers and the usage of fertilisers is determined 
on the basis of soil and crop requirements. 
 The subsidy on electricity is governed by the following provisions of the Tariff Policy 
notified by the Central Government under the Electricity Act:  
 
 “Extent of subsidy for different categories of consumers can be decided by  the State 
Government keeping in view various relevant aspects.  But provision of free electricity is not desirable 
as it encourages wasteful consumption of electricity besides, in most cases, lowering of water table in 
turn creating avoidable problem of water shorta ge for irrigation and drinking water for later 
generations. It is also likely to lead to rapid ri se in demand of electricity putting severe strain on the 
distribution network thus adversely affecting the qua lity of supply of power. Therefore, it is necessary 
that a reasonable level of user charges is levied. Th e subsidized rates of electricity should be permitted 
only up to a pre-identified level of consumption beyond which tariffs reflecting efficient cost of 
service should be charged from consumers. If the Stat e Government wants to reimburse even part of  WT/TPR/M/182/Add.1 
 Page 111 
 
 
  this cost of electricity to poor category of consum ers the amount can be paid in cash or any other 
suitable way. Use of prepaid meters can also facilita te this transfer of subsidy to such consumers.” 
  These policy measures and guidelines are intended to  ensure that the problems related to the 
degradation of natural resources are mitigated. 
 
Q.14.  The Secretariat's report (WT/TPRS/182, pag e 100, paragraph 6) reveals that India was the 
world's biggest dairy producer in 2003/04 and that its production of milk has increased substantially, 
with around 91 million tonnes produced in 2004/05.  A related and rapidly growing activity is food 
processing.  New Zealand notes the rapid developmen t and growth of this industry.  Could India 
comment on the SPS measures that it requires from  its domestic producers, and how these match the 
requirements for imports? 
 
Reply: In respect of dairy products, the standa rds laid down under the Prevention of Food 
Adulteration Act (PFA) are applied, which are based on international standards, guidelines or 
recommendations of the Codex Alimentarius Commissi on where they exist or on higher levels of 
sanitary protection based on scientific justification or  as a consequence of the level of such protection 
determined to be appropriate, c onsistent with the objectives and disciplines of the Agreement on the 
Application of Sanitary and Phytosanitary Measures.   Such standards applied on imports ensure that 
they do not constitute a means of arbitrary or unjustifiable discrimination between Members where 
the same conditions prevail or act as a disguised restriction on trade.   
 
Q.15.  India’s report (WT/TPR/G/182, page 33, par agraphs 162-165) notes that the rising incidence 
of non-tariff barriers, in the form of san itary and phytosanitary (SPS) measures and technical 
barriers to trade (TBT) has emerged as a major tr ade concern, particularly as such new measures 
very often have market access implications.  New Zealand notes India’s concerns regarding 
restrictive access for its exports due to certain SP S and TBT measures.  Could India comment on how 
it has ensured that its own SPS measures are cons istent with international standards and do not 
unfairly restrict access to the Indian market?   
Reply:  The Indian sanitary and phytosanitary measures ar e based on scientific pest risk analysis in 
line with the provisions of IPPC and also in accordance with the International Standard for 
Phytosanitary Measures and the Sanita ry and Phytosanitary Agreement.  
  
SWITZERLAND
 
 
Q1. Para. 2: According to §2, exports are now considered a main engine of growth alongside 
domestic consumption and investment. In the report s ubmitted by India, §65 me ntions that the scheme 
for the Special Economic Zones (SEZs) has been an important policy initiative for export promotion. 
From an economic perspective, it is preferable to reduce import duties, which act as an indirect tax 
on exports, rather than granting tax exemptions to specific industries or areas, which may lead to 
economic inefficiencies. Which industries are targ eted and based on which criteria? Moreover, SEZs 
may encourage investment diversion, leading to revenue  losses in a context of ongoing efforts to 
broaden the tax base (§18). How does the Indian delegation assess the fiscal costs of SEZs?  
 
Reply: The main objective of the SEZ scheme is to ge nerate additional economic activity thereby 
enhancing employment generation and investment in cluding Foreign Direct Investment for enhanced 
manufacturing activity for exports.   Under the Speci al Economic Zones, there are no specific target 
industries since Special Economic Zones can be set up in any of the areas which are not otherwise 
banned under the existing Industrial Policy.  
 WT/TPR/M/182/Add.1 
Page 112  
 
  The benefits derived from the multiplier effect of  the investments, additional economic activity 
in the SEZs, demand creation on this account in the domestic areas and the employment generated 
thereof are estimated to far outweigh the tax exemptions .  
 
Q2.  Furthermore, as para. 2 of the summary ob servations suggests, India appears to be facing a 
complex set of schemes which are creating notably bia ses against exports that in turn need to be 
corrected by a multitude of other measures of a mi croeconomic nature, including subsidies, to re-
establish their international competitiveness. Such a flurry of individual measures, which do not seem 
to be necessarily consistent with each other, a ppears therefore to be a rather inefficient way to 
promote or re-establish the competitiveness of expor ts. Do the Indian authorities have any plans to 
modernize and simplify their indirect taxation structure, and if not, why?  
 
Reply:  The present tax structure is quite simple though there are certain exemptions.  It is 
Government’s endeavour to gradually remove ex emptions, which are no longer relevant in the 
changed circumstances.   Q3. Question not related to a specific paragraph: The government of India had informed us at the last 
TPR that  it had set up a high-level committee on "Reforming Investment Approval and Implementation Procedures" and was expecting its reco mmendation at that time. Could the Indian 
authorities be so kind to share the main features of the recommendations and also inform which of 
these recommendations and to what extent had been  implemented in the meantime?  (DIPP; 
Department of Economic Affairs)  
Reply:  The recommendations of the report on ‘ Reform ing Investment Approva l and Implementation 
Procedures ‘ are available at the following website. http://dipp.nic.in/implrepo/implrepo1.pdf . It is currently under consideration. 
  
Q4. Para. 39: The Secretariat's report indicates that Mauritius benefits from a tax treaty with India, 
an advantage of which being that investment is ex empt from the capital gains tax. As a result, 
Mauritius is the most important country of origin of FD I in India. Could India list the main features of 
the tax treaty between Mauritius and India? Could the Indian authorities indicate whether Mauritius 
is the sole country benefiting from such a tax advant age and whether there are plans to extend this tax 
benefit to other nations?  
 
Reply:  The Double Taxation Avoidance Convention (DTAC) between India and Mauritius was 
notified on 6
th December 1983.  The main features of the tax treaty between Mauritius and India are as 
follows:  
 
(i) Article 7 - The business profits of an enterprise of one state are taxable in the other 
state only if it has a Permanent Esta blishment in the other state.   
(ii) Article 8- Profits from the operation of sh ips or aircraft in international traffic are 
taxable only in the state in which the place of effective management of the enterprise is situated. 
(iii) Article 10 and Article 12 -The withholding  tax rates in the state of source for 
Dividends and Royalties are as follows:  (a) 5% of the gross amount of the dividends if the beneficial owner is a company 
which holds directly at least 10 % of the capital of the company paying the 
dividends, and 15 % of the gross amount of the dividends in all other cases; 
(b) 15% of the gross amount of the royalties 
(iv) Article 13 - Capital Gains on alienation of immovable property are taxable where the 
property is situated. Capital Gains on sale of shares of a company are taxable in the country of residence of the investor.   WT/TPR/M/182/Add.1 
 Page 113 
 
 
  (v) Article 22–The state of residence is given the right to tax any income not expressly 
dealt in the Convention. 
(vi) Article 23- Elimination of Double Taxation is through the credit method. Credit for 
the tax paid on income in the state of source is to be given against the tax payable on such income in the state of residence. 
(vii) Article 26 provides for Exchange of Inform ation or Document as is necessary for 
carrying out the provisions of the Convention or for prevention of evasion of taxes on income.  
  Tax advantage is arising to residents of Mauritius on account of the combination of the 
provisions of Article 13 on Capital Gains of the India-Mauritius Double Taxation Avoidance 
Convention (DTAC) and the domestic  tax law of Mauritius pertaining to taxation of Capital Gains. 
The provisions of Article 13 on Capital Gains of the India-Mauritius DTAC provide for taxation of 
Capital Gains arising from the alienation of shares of  a company in the country of residence of the 
investor. The domestic law of Mauritius does not ta x capital gains arising from alienation of shares. 
Thus, capital gains arising to a resident of Mauritius from alienation of shares of an Indian company 
would not be taxable either in India or in Mauritius,  leading to a benefit to the Mauritian residents in 
the form of non-taxation of Capital Gains arising from alienation of shares of Indian companies.  
  The following DTAAs of India have provisions relating to taxation of Capital Gains from alienation of shares which are identical to that in the India-Mauritius DTAC: -  
(a) Cyprus  
(b) Syria  (c) Tanzania  (d) Thailand  (e) UAE  
(f) Indonesia  
(g) Zambia  (h) Singapore 
 
 In order to safeguard the capital gains ta x concession against possible misuse, the India-
Singapore Protocol notified in July, 2005 provides for anti-abuse provisions which aim at denying 
benefit of the capital gains tax exemption to shell/c onduit companies. Out of the aforesaid 8 countries, 
only in the case of Cyprus, Singapore, UAE, Zambia  and Syria, capital gains tax on alienation of 
shares is not levied on residents of those count ries under their domestic law.  In the remaining 
3 countries, capital gains from alienation of shar es are taxed under the domestic law. Thus there are 
five countries in which the combination of domestic law with the provisions of the DTAA with India 
leads to non-taxation of capital gains from sale of shares in the country of residence of the investor as 
well as in the country of source of such gains.   The process of revision of DTAAs having identical capital gains provisions as that of Mauritius, other than the India-Singapore DTAA, has been initiated to provide for source-based 
taxation of such gains. Thus, rather than extending  to other nations the tax benefit arising on account 
of provisions of DTAA relating to taxation of Capi tal Gains from alienation of shares in the country 
of residence of the investor, India is in  the process of renegotiation of such DTAAs. 
 
Q5. General question not related to a specific par agraph: We understand that India as a federal 
country has competences allocated to the central level and others to  the state level. While issues 
relating to international trade are the prerogative of  the central level, subject matters which may also 
be dealt with in international trade agreements be long more broadly to the state competences. How is 
this being handled when an international agreemen t is being negotiated and ratified? In case a state 
would not abide by the rules of an international agreem ent in a field that falls into its competences, WT/TPR/M/182/Add.1 
Page 114  
 
  what measures, if any, would the central government have at its disposal to make sure that India's 
international obligations  are fully implemented? 
 Reply:   Legislative powers derive fro m three lists in the Constitution of India. The longest list, 
comprising the ‘vital interests of the State,’ vests in the Union government. It includes items like defence, arms and ammunitions, fore ign affairs, foreign trade, atomic energy, treaties, war-and-peace, 
electronic communication, currency, coinage, the Rese rve Bank of India, industries, natural resources, 
apex courts of law, and the Constitution, to name but a few. 
  
The states’ list comprises, among other things, public order, police, trade, and commerce 
within the state, agriculture, markets, money le nding, land revenue, excise duty, and various taxes. 
The concurrent list( for which both the Union and the State could legislate) includes such items as 
detention for ‘security of the state,’ transfer of  non-agricultural property, contracts, economic, and 
social planning, monopolies, TU’s, social security, e ducation labour welfare, factories, price control, 
and electricity. All residuary powers of legislation are vested in the Union Government. The question 
of a state not abiding by the rules of an  international Agreement has not arisen. 
 
Q6. Para. 13-14: India's Foreign Trade Policy ackn owledges the importance of facilitating imports 
required to stimulate the economy and calls for a simplification of import procedures and reduction of 
import barriers, and coherence and consistency between trade and other economic policies. Could 
India indicate whether specific import simplifica tion procedures have already be identified and if so, 
could India please list these measures? In the same vein, could India specify which measures could be 
envisaged to ensure to neutralize "... the incidence of all levies and duties on inputs used in export 
products based on the fundamental principle t hat duties and levies should not be exported"?  
 
Reply:  Simplification of import procedures to reduce transaction cost is an ongoing process, and inter 
alia include providing for on line assessment, minimizing pre-clearance verification, risk based 
assessment, post clearance audit etc. As regards neutralization of taxes and levies on exports, the 
underlying principle is that duties and levies are not to be exported.   Q7. Para. 37: Could the Indian authorities indica te when they plan to introduce duty free and quota 
free market access for LDC? Will this be a phased-in introduction or  will India already cover 100% 
of its tariff lines? 
 
Reply:  The Government is examining the issue of gr ant of unilateral tariff preferences to least 
developed countries (LDCs). This will be a phased introduction and India hopes to introduce it this 
calendar year  Q.8. Para. 8: Could India indicate the purpose of the central sales tax on inter-states sales of goods?   
Reply:  The basic philosophy followed in taxation of ‘sale of goods’ is that ‘sale of goods’ should be 
taxed in the state in which the goods are sold fina lly for consumption. CST, on the contrary, is a tax 
that is levied in the originating state and is against the destination principle. CST however was 
considered necessary for regulating inter-state tr ade for providing a minimum incentive to the 
originating state to administer the system of tracking each inter state sale to a valid registered dealer in 
the destination state so that the normal sales tax c ould be collected in the destination state and tax 
evasion could be prevented.   Q9. Para. 16: according to paragraph 16, India uses reference prices for the valuation of certain 
goods. How does India assure that by that it is not imposing minimum prices prohibited by Art. 7 (f) of the CV Agreement?    WT/TPR/M/182/Add.1 
 Page 115 
 
 
  Reply:  Under Section 14(2) of Customs Act, 1962 Ta riff Values can be fixed for any class of 
imported goods or export goods  having regard to the trend of value of such or like goods.  There is no 
provision for imposing minimum prices.  The tariff value mentioned above is currently being fixed 
only in respect of palm group of oils, crude soyabeen  oil and brass scrap.  These values are based on 
the current international prices and are being frequently revised.    Q10. Para. 18: this paragraph mentions exped ite and simplified import procedures for "accredited 
clients". Could India indicate the criteria as well as  the procedure to be el igible for such special 
treatment?   
 
Reply:  The details regarding Accredited Client’s Progr amme (ACP)  are mentioned in Circular No. 
42/2005-Customs dated 24. 11.2005. The same is available in the website www.cbec.gov.in. 
 
Q11. Para. 21: According to the report, tariffs remain a major source of revenue for the Central 
Government (23%).  With the planned shift from  VAT to GST do you foresee any incidence on the 
percentage contribution of these internal taxes to government revenue? When will the GST be 
implemented? What is the main d ifference with the current VAT scheme?  
 
Reply: The target date for introduction of Goods and Services Tax (GST) is 1.4.2010. The design and 
structure of GST is to be finalized through a pr ocess of consultations between the Union and State 
Governments. The revenue from GST will depend on the result of such consultations and the design 
of GST finally adopted for implementation.    The difference between the current VAT and the integrated GST is that the various internal 
taxes collected by the Centre and the States are propo sed to be integrated into a uniform levy.  Under 
the GST, there would be full tax credit. But under the present scheme, as the State taxes and Central 
taxes are charged differently, there is no provisi on for allowing credit of central taxes against State 
taxes and vice-versa. 
 
Q12. Para. 21 (and 25): this paragraph indicates t hat the applied tariffs - notably those subject to 
exemptions - are being announced with the annual B udget, but that rates may be subject to changes 
during the year. These changes are made on an ad  hoc basis through gazetted notifications. Does 
India plan any internet based publication of these applied rates?   
Reply: No changes in the tariff are ma de in an ad hoc manner.  Rates are decided taking into 
consideration the needs of a particular segment of  industry, to augment supply, to keep prices in 
check, and other relevant factors.  The system is completely transparent as all such notifications are 
placed in both the Houses of Parliament, published in the Gazette and are also put on departmental 
website (www.cbec.gov.in).  
 
Q13. Para. 31: In the Budget speech delivered  in February 2006, the Minister of Finance 
acknowledged the complexity of the tariff exemp tions. Which measures are foreseen to reduce this 
complexity of these schemes? Does India plan  any measures to enhance transparency on these 
schemes? What is the duration of the exemptions rel ated to industrial use? What are the requirements 
to demonstrate a specific industry use in order to  be eligible for exemption? How does India avoid 
fraud? How does the government avoid discretionary trea tment by customs officials? Is it possible to 
obtain some kind of advance rulings in this matter?   
 
Reply: The exemptions are given on various considera tions keeping in mind the need for promoting 
various objectives, such as promotion of sma ll-scale sector, encouraging goods made from 
unconventional raw materials, promoting employment, etc.  Exemptions are reviewed at periodical
 
intervals and exemptions which are not considered  necessary in view of the changed circumstances 
are withdrawn.  There may or may not be a time limit for such exemptions  but each exemption is WT/TPR/M/182/Add.1 
Page 116  
 
  reviewed regularly.  There are end-use notificati ons where concessions are given provided the goods 
are used in a specified industry.  To check fraud in such cases, there is a system of physical 
verification/audit.  As regards giving advance ruling,  there is a provision for giving advance ruling on 
classification and valuation of goods, applicability of exemption notifications etc. but only for 
specified foreign entities. 
 
Q.14. Para. 33: Could India provide some more cl arity on its TRQ administration related to milk 
powder?   
Reply: Skimmed and whole milk powder, milk food fo r babies etc. covered under ITC (HS) 0402.10 
or 0402.21 up to 10,000MTs is allo wed in a financial year at a consessional rate of customs duty of 
15%. All eligible entities desiring to avail the quota as mentioned above, may make an application to 
the Directorate General of Foreign Trade. Comple ted application forms must reach on or before 1
st 
March of each financial year preceding to the year of quota. Imports have to be completed before 31st 
March of the financial year for which the quota has been allocated. Further details relating to TRQ 
administration are available at the website www.dgft.gov.in 
 
Q15. Para. 34: Unfortunately, the explanations on th e special duty are not totally clear to us. Could 
India give some more insight in the difference that still prevails between that special duty and other 
domestic taxes? How does India concede that th ese domestic taxes are in so me instances lower (or 
higher) than the 4% special duty withou t infringing Art. II of the GATT?   
 
Reply: Special additional duty of customs, commonly kn own as special CVD, at the rate of 4% has 
been levied on imported goods to counter balance the internal taxes such as sales tax, value added tax, 
local tax or any other charges leviable on a like artic le on its sale, purchase or transportation in India. 
 
 The intention of the Government is to safegua rd the interests of indigenous industry, which 
suffers from various taxes levied and collected by th e States. The levy of this duty is to counter the 
impact of such taxes.  To illustrate, taxes levied  on such goods by variou s agencies other than the 
Central Government are: 
(a) Central sales Tax (CST) on inputs procured from other States. 
(b) CST on products sold in other States. 
(c) Octroi levied by Municipalities on entry of goods. The rate of octroi varies from 2.5% 
to 5.5%. This is applicable on in puts needed by the industry also. 
(d) Electricity duty levied by the State Governments on consumption/sale of electricity, 
which is one of the inputs for manufacture of  goods. Rate of electricity duty varies 
from State to State. 
(e) Sales tax on petrol/diesel – No credit. 
 These taxes are in addition to general St ate VAT which varies between 4% - 12.5%. 
  In India, no set-off is available for the CST on inputs, octroi on inputs, electricity duty and sales tax paid on auto fuels.  Total of these intern al taxes depends upon the location of an industry and 
type of goods it manufactures. Special additional dut y is charged only at 4%, which is the minimum 
rate. The incidence of internal taxes borne on dom estic products are much higher than the Special 
CVD rate of 4%.    Paragraph 2 of Article II read with para graph 2 of Article III of GATT, 1947 permits 
imposition on imported products of a charge equivalent to internal taxes or other internal charges 
applied, directly or indirec tly, to the like domestic products. 
 
Q16. Para. 41 of the Secretariat's report suggests that the Directorate General of Anti-Dumping and 
Allied Duties (DGAD) in the Ministry of Co mmerce and Industry can initiate an anti-dumping  WT/TPR/M/182/Add.1 
 Page 117 
 
 
  investigation on its own initiative if it is satisfied that there is justification to launch such an 
investigation. Could the Indian authorities indica te under what circumstances and on the basis of 
what criteria DGAD would they conclude that th ere is justification to launch an anti-dumping 
investigation even in the absence of a co mplaint by the domestic industry?   
 
Reply: In accordance with Article 5.6 of the Anti-Dump ing Agreement, there is a provision in the 
Customs Tariff Act,1975 to initiate anti dumping inves tigation by the DGAD on its own initiative if it 
satisfied that there is justification to launch such  an investigation.  As a matter of practice,the 
designated  Indian authority normally initiates inv estigation on the basis of a fully documented 
application made by the domestic industry.   Q17. Para 53: Some 53% of standards issued between July 2002 and October 2006 are harmonized 
with ISO/IEC standards. According to the authoritie s, the process of reviewing identified standards 
where ISO/IEC standards exist, is being expedited.  In addition, a greater percentage of sectoral 
standards, for example, in chemicals, petrochemicals , electrical and electronic industries, tend to be 
aligned with ISO/IEC standards. Switzerland welcomes the fact that more than half of the national 
standards adopted in this time period are harm onized with ISO/IEC standards. We would however 
appreciate to receive more information about the degree of harmonization with international 
standards in the field of medical devices.   
 
Reply:  As on date, the Buraeu of indian Standrads (BIS) has harmonized 134 standards with 
ISO/IEC. While 111 identical standards have been  published as Dual numbers, and 23 have been 
considered as technically equivalent 
Q18. Para 54: Although ISI certification is volunt ary, it has been made compulsory for 66 products 
related to health and consumer safety (133 at the time  of the last Review).  It is not clear, which 
products have been removed from the list. Swit zerland would be very interested in knowing which 
products require compulsory certification. What cr iteria are applied to decide whether a product 
requires compulsory or voluntary certification? Fo r product areas with mandatory certification we 
would also be interested to know whether fo reign test reports and certificates are accepted.   
 
Reply:  Presently, there are 68 products under mandatory certification. A list of these products is 
available at the BIS Website: www.bis.org.in. The products which affect consumer health, safety, 
environment, infrastructure and are of mass c onsumption are under mandatory certification.  
  India accepts Certification Body (CB) test certificates issued by the National Certification Bodies of other countries under the CB scheme for el ectrical products covered in the scope of BIS 
approval for the purpose of grant of BIS Certificati on. The website of IECEE may also be referred to 
for getting more information on the scope of BIS approval. 
 
Q19. Para 54: Product certification can also be  granted outside India once the manufacturer's 
production facilities have been approved and licen sed by the BIS. Does India accept OIML 
(International Organization of Legal Metrology) certificates issued by a member of that 
organization?   
 Reply:  BIS does not accept OIML (International Organization of Legal Metrology) certificates issued 
by a member of that organization, for BIS Certification Scheme purposes.   
Q20. Para. 78: The report indicates, that India is not a party to the WTO Agreement on Government 
Procurement (GPA) and that it firmly rejected in th e past the idea of such a participation. As 
evidenced by the Secretariat, India made valuabl e efforts to increase transparency and competition in 
its procurement system, mainly through improvemen ts in the field of electronic procurement as 
explained in § 72. The new actions undertaken by  India to improve the fight against bribery in WT/TPR/M/182/Add.1 
Page 118  
 
  government procurement (§ 77) is also a positive step in the direction to the standards the GPA-
Members recently agreed upon. Finally, the system of preferential policies at central government 
level has be extended until 31 March 2008. All these me asures are bringing India closer to the revised 
GPA. What are, today, the views of the Indian author ities with regard to the objective of joining the 
GPA? What are, if any, the major obstacles to be  eliminated for realizing this objective?   
 Reply: The issue of India’s accession to GPA is under examination. At present a firm commitment on 
this issue is not possible  
Q21. Para. 85: Could the Indian authorities provid e us with a closed list of products that remain 
subject to export taxes?  
Reply: At present, export duty is levied on (i) some items of leather (ii) iron ore and concentrates, and 
(iii) chromium ore and concentrates.  Q22. How are export prohibitions or controls re gulated with regard to the export of arms and 
sensitive dual-use goods (as controlled e.g. by the int ernational export control instruments such as the 
Wassenaar Arrangement, the Australia Group, the Missile Technology Control Regime, MTCR and 
the Nuclear Suppliers Group, NSG; India, a non-member, has shown willingness to adhere 
voluntarily to the guidelines of the NSG and the MTCR)?    
Reply:  The export prohibition on controls with re gard to sensitive dual use goods are regulated 
through Inter Ministerial Working Group (IMWG) cons tituted in the office of the Directorate General 
of Foreign Trade. Before giving export permission for a dual use item, the IMWG considers the views  
of all the concerned Departments of Government  of India and then decides the case on merits. 
 
Q23. Para. 103: In para. 103, the Secretariat' s report notes that under the current guidelines on 
lending to the priority sectors, 12% of net bank cred it (within the overall target  for foreign banks of 
32% of net bank lending stipulated for priority sect or lending) must be loaned to the export sector by 
foreign banks having offices in India and that loans have to be provided at concessional rates of interest. Could the Indian authorities explain why they deem such a scheme as necessary and how 
they reconcile the long-term needs of improving the economic efficiency and competitiveness in the 
priority sectors with an apparently permanent prov ision of concessional financing? In addition, could 
the Indian authorities indicate whether they have pl ans to remove this differen t treatment of foreign 
banks compared to the domestic banking sector given that such a treatment is not only affecting 
negatively the competition situation on the Indian banking market but also represents a disincentive 
for the domestic banking sector to become more effi cient? Also, could the Indian authorities explain 
how they reconcile this indirect subsidy to exports  with Article 3.1(a) and Annex I (k) of the 
Agreement on Subsidies and Countervailing Measures wh ich explicitly prohibits export subsidies?   
 Reply:  
1. A certain amount of positive discrimination exis ts in favour of foreign banks by way of lower 
requirement of priority sector lending (32 per cent)  as compared to Indian banks(40 per cent). Unlike 
in the case of Indian Banks, the sub-ceiling in respect  of agricultural advances  is not applicable to 
foreign banks. Foreign banks also have the facility  of reckoning export credit towards priority sector 
advances.    
2.  Currently, pre-shipment rupee export cred it up to 180 days and post-shipment rupee export 
credit up to 90 days have a prescribed interest ra te ceiling of Benchmark Prime Lending Rate (BPLR) 
minus 2.5 per cent. The effective interest rate ceili ng of rupee export credit for public sector banks in 
December 2006 was in the range of 9.00-9.50 per cen t, as the BPLR range was 11.50-12.00 per cent.  WT/TPR/M/182/Add.1 
 Page 119 
 
 
  3.  For India, the Commercial Interest Referen ce Rate (CIRR) works out to 8.27 per cent during 
September-December 2006, given the average yield on 3-year government securities for September-
December 2006 at 7.27 per cent and adding a fixed margin of 100 basis points. If the interest rate charged on export credit is below the CIRR, it is cons idered as an official subsidy to the exporters. 
The ceiling rate on export credit prescribed by the Reserve Bank at 9.00-9.50 per cent is thus higher 
than the CIRR and therefore, there is no el ement of subsidy in the prescribed rate.  
 4. The interest rate ceiling on rupee export cr edit at BPLR minus 2.5 per cent may not be 
considered as a subsidized rate or below the cost of funds of banks.  
 
Q24. Para 157: In Paragraph 157 of its Report, the Secretariat refers to the new Patents Act, which 
became effective on 1 January 2005. Switzerland woul d like to commend India on its efforts to put 
Indian patent legislation in conformity with the TRIPS Agreement. Since the new Patents Act hasn't 
yet been subject to review, Switzerland seizes the present opportunity to address a number of points 
where clarification is requested:   
 
♦ Section 25 of Patents Act 2005 provides for tw o opposition procedures in the context of the 
application and granting of patents (pre- and post-grant opposition). Both these oppositions 
may be lodged on the same legal grounds. As far as the pre-grant opposition, it seems that no 
proof of "interested person" needs to be reg istered in order to file an opposition. The 
opposition procedures as laid down in the new Pa tent Act may result in considerable delay 
and legal uncertainty for the patent applicant. On  this background, please explain whether 
and what procedural safeguards have been put in place in order to ensure in practice an 
application of section 25 (1) of the Patents Act wh ich is compatible with the requirements in 
Article 62.4 in combination with Article 41.2 an d 3 of the TRIPS Agreement, in particular the 
requirement that such procedures shall not entail  unwarranted delays. Please indicate also 
what legal remedies are available to the pat ent applicant/holder against the suspension or 
rejection of his patent application or patent on the ground of a pre- or post-grant opposition. 
 
♦ According to Section 11A of the Patents Ac t, for patents relating to pharmaceuticals filed 
before 1 January 2005 (the "Mailbox"), the paten t holder may not institute infringement 
proceedings against manufacturers already produc ing the patented product at the time the 
patent is granted. In such cases, the patent hol der is said to be entitled to receive reasonable 
royalties. Article 28 of the TRIPS Agreement c onfers on the right holder of a patent, among 
other exclusive rights, the right to make the patented product. Furthermore, the law does 
neither define "reasonable" nor the authority fo r determining the royalty. Please explain how 
this provision complies with Article 70.8 lett er (c) in combination with Article 28 of the 
TRIPS Agreement and how it is applied in practice. 
 
♦ According to Section 3(d) of the Patents Act,  new forms of a known substance not resulting in 
the enhancement of the known efficacy are not considered inventions under the Patents Act. 
In an explanatory note to this clause, the Patents Act furth er enumerates a number of such 
forms, which shall be considered to be the sa me substance, unless they differ significantly in 
properties with regard to efficacy. Considering that in the pharmaceutical sector, the testing 
of efficacy, safety and other clinical aspects of the product or its new form is very time-
consuming and costly and thus only undertaken  once the patent application is filed, please 
explain how the applicant can meet, in practice, th e requirements set out in Article 3(d) of the 
Patents Act at the time of the patent application? 
 
♦ Referring to Article 39.3 of the TRIPS-Agreemen t and the issue of unfair commercial use of 
test data submitted by an application to the res ponsible State Agency in the procedure for 
market authorization of a pharmaceutical or of  an agricultural chemical product and the WT/TPR/M/182/Add.1 
Page 120  
 
  protection of such test data against reliance by  a second applicant, a national Committee of 
experts is said to still examine the matter in I ndia to come up with a proposal for national 
legislation. Please indicate when the report of  the Committee is supposed to be available and 
when national legislation implementing Article  39.3 of the TRIPS Agreement is expected to 
enter into force? 
 
Reply:  The system of pre-grant opposition is followed in a number of countries. The amendments in 
the Patents Act in 2005 simplified the procedure for pre-grant opposition. Earlier it was a time 
consuming, quasi-judicial process. The amended law provides for an administrative procedure which is simple, fast, and efficient and is in accordance with principles of natural justice. Against this 
administrative order, an appeal can be filed with  the Intellectual Property Appellate Board (IPAB) as 
per Section 117A of the Patents Act.  In any case, so far the number of pre-grant opposition has been 
negligible; only 199 against 50,295 publications. In the case of post-grant opposition also the decision 
of the Controller can be challenged through an appeal before the IPAB.  
 Determination of royalty is a commercial decision between the licensor and the potential 
licensee. Any dispute relating to reasonableness of ro yalty can be brought to the court for settlement. 
Exclusive Marketing Rights (EMRs) were pr ovided for pharmaceutical products (Mail-Box 
applications) during the transition period from 1.1. 1995 to 31.12.2004. Four EMRs were granted to 
the pharmaceutical products of the following companies:  
♦ Novartis AG, 
♦ Wokhardt Ltd 
♦ Eli Lilly  
♦ United Phosphorus Ltd 
  Mail-box applicants had an opportunity to ava il of the exclusive marketing rights during the 
transition period and enjoy the patent right after th e grant of patent. India is following the universal 
practice of grant of patent rights from the date of publication.  
 Patents are available to any invention that meet s the criteria of patentability, that is, novelty, 
inventiveness and industrial application. Section 3(d)  prevents the grant of patent for new forms or 
new usages of known substances and thus averts grant of frivolous pa tents, which may be obtained by 
minor modifications, particularly in the pharmac eutical sector. Applications for patents for 
pharmaceutical products account for over 89% of the total applications filed in the mail-box [7,953 
out of 8,926]. Section 3(d) is also intended to en sure availability of medicines by preventing ever-
greening of existing patents and thus is in cons onance with Member States’ rights of ensuring 
availability of medicines at reasonable prices for m eeting health requirements. This is one of the 
recognized flexibilities of the TRIPS Agreement that c ountries are free to adopt in their legislation as 
per Doha Declaration. The Declaration states that  TRIPS Agreement can and should be interpreted 
and implemented in a manner supportive of WTO memb ers’ right to protect public health and, in 
particular, to promote access to medicines for all. The importance of these flexibilities has been 
highlighted in the reports of the United Kingdom  Commission on Intellectual Property Rights as well 
as the World Health Organization Commission on Intellectual Property Rights.  
Q25. Question not related to a sp ecific paragraph: Could India indicate the conditions governing the 
temporary entry of natural persons that are empl oyed by a foreign mach ine building company and 
enter India in order to install or maintain indu strial machinery or equipment of the company?   
 
Reply:  In Mode 4, India has offered commitments fo r 4 categories of natural persons in the GATS 
negotiations of the Doha Round. These categories are Business Visitors, Intra Corporate Transferees, 
Contractual Service Suppliers, and Independent Professionals. These categories are not end use /  WT/TPR/M/182/Add.1 
 Page 121 
 
 
  activity based. Both in the case of a Swiss co mpany that has commercial presence in India (Intra 
Corporate Transferees) or where there is no commercial presence (Contractual Service Supplier – Employees of a Juridical Person) the activity mentione d in the question would get covered.  India has 
also not received any complaint from any Swiss compan y regarding the delay in the grant of relevant 
visas.  
 
Q26. Para. 114: The Report of The Government states that certain qualified Mutual Funds are 
permitted to invest in overseas exchange traded fu nds. Could you please specify the qualification 
requirements that are to be met by mut ual funds in order to invest overseas?  
 
Reply: In this regard, SEBI’s circular SEBI/IMD/ CIR No.7/73202/06 dated August 2, 2006 may be 
referred to.  
  To be eligible to invest in overseas ETFs, one of the two following conditions have to be 
satisfied: 
  
i. The Mutual Fund shall be in existence for a minimum period of 10 years as on July 31, 
2006 and managing schemes. 
ii. The Mutual Fund or its sponsors shall have experience, to be certified by the Trustees, of 
investing in foreign securities, and an appr opriate disclosure regarding the nature of 
experience shall be made in the offer document. 
 
 Further, mutual funds can invest in overseas ETFs within an overall limit of US $1 bn. with a sub-ceiling for an individual mutual fund which should not exceed 10% of the net assets managed by 
them as on March 31 of each relevant year, subject to a maximum of US $ 50mn. per mutual fund. 
 Q27. Para. 114: The Report of the Government al so points to the introduction of the Liberalised 
Remittance Scheme whereby resident Indians were permitted to remit up to US$ 25,000 per calendar 
year for any current or capital account transaction.  Are there any further legislatory projects by 
Indian authorities to gradually open up capital and current account restrictions for resident Indians?   
 
Reply: As a measure of further liberalisation of the capital account transactions the following 
measures have been announced in the Annual Policy  
 Rationalisation of Overseas Investment   In order to provide greater flexibility to I ndian companies for investments abroad and to 
rationalise the existing facilities, it has been decide d to enhance the overseas investment limit (total 
financial commitments) for Indian companies from th e existing limit of 200 per cent of their net worth 
to 300 per cent of their net worth, as per the last audited balance sheet. Further the limit for portfolio 
investment abroad by listed Indian companies in  listed overseas companies has been increased from 
25 per cent of net worth to 35 per cent of net worth.  
Overseas Investment by Mutual Funds 
  The aggregate ceiling on overseas investment by mutual funds has been increased from 
US $ 3 billion to US $ 4 billion. 
Liberalised Remittance Scheme 
The limit for remittances under the Liberalised  Remittance Scheme h as been increased from 
USD 25,000 per calendar year to USD 50,000 per fina ncial year in December 2006 and this limit was WT/TPR/M/182/Add.1 
Page 122  
 
  enhanced further to USD 100,000 per financial year for any permitted current or capital account 
transaction or a combination of both. 
 The further liberalization and rationalization of foreign exchange regulations is a part of an 
ongoing process and measures, as appropriate would be announced as and when considered necessary.  
 Q28. Para 142: In Paragraph 142 of its Report, Indi a mentions the introduction in the Patents Act of 
a provision enabling the grant of a compulsory lic ense for exportation in accordance with the WTO 
GC Decision of 30 August 2003 on the Implemen tation of Paragraph 6 of the Doha Declaration on 
the TRIPS Agreement and Public Health. The mec hanism provided therein includes measures to 
prevent misuse for commercial purposes and diversion in order to ensure that such pharmaceuticals 
actually reach the country of destination through sp ecific labelling or marking to identify the products 
as being produced under the system. Suppliers shoul d distinguish such products through special 
packaging and/or special colouring/shaping. Pl ease indicate whether and where India has actually 
implemented these measures.  
 Reply:  No compulsory license has been issued by I ndia so far. Even when faced with the grave 
problem of Avian Flu, it preferred to negotiate with the patentee, that is, M/S Roche for supply of the 
drug, Tami Flu. When M/s Roche expressed its in ability to supply the requi red quantity, balance 
demand was met through license obtained from the patent ee. There has been no request for grant of 
Compulsory License for export of medicines under the WTO General Council Decision of 30 August 2003. 
 
 
THE EUROPEAN COMMUNITIES
 
 
 In Paragraph 142 of its Report, India men tions the introduction in the Patents Act of a 
provision enabling the grant of a compulsory licen se for exportation in acco rdance with the WTO GC 
Decision of 30 August 2003 on the Implementation of Paragraph 6 of the Doha Declaration on the TRIPS Agreement and Public Health.  The mechanism  provided therein includes measures to prevent 
misuse for commercial purposes and diversion in order to ensure that such p harmaceuticals actually 
reach the country of destination through specific labelling or marking to identify the products as 
being produced under the system. Suppliers should di stinguish such products through special 
packaging and/or special colouring/shaping.  Plea se indicate whether and where India has actually 
implemented these measures.  
 
Reply:  The Patent Act as amended in 2005 provides m echanisms for implementation of Paragraph 6 
of the Doha Declaration on the TRIPS Agreement a nd Public Health. So far, no compulsory license 
for export of medicines has been issued. 
 
WTO Secretaria's Report, page 11, para. 22 
1. What is the likely timescale for the mergi ng of VAT, services tax and central excise duty to be 
merged into a more general goods and services tax (GST)?    
Reply:  The target date for introduction of GST is 1.04.2010. 
 
India's report page 17, para. 69 
India's report states that Central Sales Tax will be reduced from 4% to 3% from 1 April 2007.  2. What is the likely timescale for the total abolition of this tax?     WT/TPR/M/182/Add.1 
 Page 123 
 
 
  Reply: CST rate has been reduced from 4% to 3% w ith effect from 1 April, 2007.  As per the 
roadmap for phasing out of CST agreed to between the Union and the States, CST is to be reduced 
further to 2% w.e.f 01-04-08, 1% w.e.f 01-04-09 and to be completely abolished on 31-03-2010. 
 
WTO Secretariat’s Report , page 13 , para 30  
 
It is stated “Part of the problem in implementing a more flexible labour market policy is the lack of a social safety net. The National Common Minimu m Programme (NCMP) acknowledges that some 
changes in labour laws may be required, provided  they fully protect the interests of workers and 
families and take place after consultation with the trade unions”. 
 
3. Could India provide more details regarding this programme?  
Reply:  Both the Central and the State Government s can enact laws on Labour since it figures under 
the Concurrent List of the Constitution. There are 43 Central laws to protect workers’ interests and 
promote their welfare.  These cover industrial relations, social security, wages, welfare etc.  Both 
Central and State Governments implement the labour  laws through their implementation machineries 
in their respective jurisdiction. Review/updation of labour laws is a continuous process in order to 
bring them in tune with the emerging needs of the economy.     This is an essential ingredient of labour reforms. 
 
 The National Common Minimum Programme (NCM P) of the UPA Government provides as 
follows:    “The UPA rejects the idea of automatic hire and fire. It recognizes that some changes in 
labour laws may be required but such changes must fu lly protect the interests of workers and families 
and must take place after full consultation with trade unions. The UPA will pursue a dialogue with 
industry and trade unions on this issue before co ming up with specific proposals. However, labour 
laws other than the Industrial Disputes Act that creates an Inspector Raj will be re-examined and 
procedures harmonized and streamlined. The UPA government firmly believes that labour-
management relations in our country must be mark ed by consultations, cooperation and consensus, 
not confrontation. Tripartite consultations with trade unions and industry on all proposals concerning 
them will be actively pursued. Rights and benefits earned by workers, including the right to strike 
according to law, will not be taken away or curtailed.”   Keeping the NCMP provisions in view, an am endment proposals in respect of certain acts 
have been initiated, the present status of which is as under: 
 (i) The Factories (Amendment) Bill 2005 has been introduced in the Lok Sabha on 16
 August 
2005.  The Bill proposes to amend the Section 66  of the Factories Act 1948, so as to provide 
flexibility in the matter of employment of wome n during night shift with adequate safeguards 
for their safety, dignity, honour and transporta tion from the factory premises to their nearest 
point of their residence. 
 (ii) The Labour Laws (Exemption from Furnishing  Returns and Maintaining Registers by Certain 
Establishments) Act, 1988 presently provides for maintaining combined registers and submission of simplified returns in respect of  9 Scheduled Acts. It is applicable to 
establishments employing upto 19 persons only. It  is proposed to amend the Act in order to 
enlarge its scope by covering 16 Acts and estab lishments employing more number of persons 
with provision for maintaining registers on computer and sending returns through soft devices. The amendment Bill was introduced in Rajya Sabha on 22.08.2005. Subsequently it 
was referred to the Parliamentary Standi ng Committee on Labour for examination.  WT/TPR/M/182/Add.1 
Page 124  
 
  (iii) An amendment bill relating to the Apprentices Act, 1961 has been introduced in the Rajya on 
19 May, 2006 to provide (a) rese rvation for Other Backward Classes, (b) related instructions 
to be imparted at the cost of employer and (c ) flexibility in respect of the ratios prescribed for 
Apprenticeship Scheme. The Bill has been refe rred to Parliamentary Standing Committee on 
Labour for examination.  
 
(iv) The  Maternity Benefit (Amendment ) Bill,  2007 has been introduced in the Rajya Sabha on 
14 May, 2007  to raise the Medical Bonus payable under the Maternity Benefits Act, 1961 from Rs.250/- to Rs.1000/-  and to give powers to the Central Government to revise medical 
bonus from time to time subject to a maximum of Rs.20,000/- 
 
 In order to create a dynamic labour market environment, a right balance of ‘flexibility’, 
‘stability’ and ‘security’ needs to be provided. While flexibility is required by the employers to adjust 
to the changing market conditions, th e workers need to be provided with basic security. endeavor of 
the Government  has been to bring about labour re forms by following consensual approach and to 
maintain harmonious industrial relations through ef fective intervention of Central and State Industrial 
Relations Machineries.  
 The report states “the Government has taken certain initiatives, such as upgrading technical 
institutes so that they can produce  a multi-skilled wo rkforce  and training so that existing skills can 
be adapted to changes in technology. A skills  development initiative through public-private-
partnerships is to be started, it is envisaged that  this would provide training to a million workers in 
the first five years and a million workers annually thereafter.  4. Could India provide details of the skills development initiatives and skill upgrading 
programmes that  have to be undertaken? 
 
Reply:  India has taken up a scheme for the upgradation of 500 Industrial Training Institutes (ITIs) in 
the country into “Centers of Excellence (CoE )” for producing multi skilled workforce of world 
standard. The highlights of the scheme are introduc tion of  multi skilling courses during the first year, 
followed by advanced/specialized modular courses subsequently by adopting industry wise cluster 
approach,  multi entry and multi exit provisions, a nd Public-Private-Partnership in the form of 
Institute Management Committees (IMC)  to ensure greater & active involvement of industry in all 
aspects of training. Subsequently, a scheme for upgr adation of 100 Government ITIs with domestic 
funding was approved in March 2005. These 100 ITIs we re distributed in 22 States/ Union Territory 
Administrations with 75:25 funding pattern to be  shared between Centra l and State Governments 
respectively.   For remaining 400 Government run ITIs, the Ministry is in dialogue with the World 
Bank for providing financial assistance.  
  A 100% centrally sponsored scheme for upgrading the 37 existing ITIs in the State of Jammu and Kashmir and for setting up of new Women ITI at  Jammu has been taken up during the financial 
year 2005-06.  A similar  scheme for the North Eastern states including Sikkim for establishing 22 
new ITIs and upgrading 35 existi ng ITIs is under implementation. 
 
 The Ministry of Labour & Employment has undertaken an initiative for skill development for the school drop- outs and existing workers especially in  the informal sector in  close consultation with 
Industry, micro enterprises in the informal sector, State Governments, experts, academia.  This was 
essential considering their educational, social and economical background.  The key features of the 
new frame work for skill development are: 
 
1. Demand driven Short term training courses based on Modular Employable Skills 
(MES) decided in consultation with Industry 
2. Flexible delivery mechanism (part time, weekends, full time)  WT/TPR/M/182/Add.1 
 Page 125 
 
 
  3. Different levels of programmes (Foundation level as well as  skill upgradation) to 
meet demands of various target groups 
4. Training to be provided by Vocational Tr aining (VT) Providers under the Govt., 
Private Sector and Industrial establishments.  
5. Optimum utilisation of existing infrastructure to make training cost effective.   
6. The services of existing or retired facult y or guest faculty to be utilised  
7. Testing of skills of trainees by an in dependent assessing body who would not be 
involved in conduct of the training programme, to ensure that it is done impartially. 
  A new scheme “Testing and Certification of Skills  of Workers in Informal Sector” was taken 
up during the 10
th  Plan period. Competency based standard s in 46 skill areas have been developed, 
and 8,400 construction workers have been tested and certified.     Three new Vocational Rehabilitation Centres (V RCs) for Handicapped have been set up, one 
each at Srinagar - J&K, Una - Himachal Pradesh  and Pondicherry - Pondicherry. These VRCs will 
evaluate the residual capacity of the disabled, provi de adjustment training, and help them in their 
rehabilitation.     Training capacity of Industrial Training Institut es / Centres enhanced  by way of setting up 
new Institutes and  introduction of additional trade un its in existing ITIs. Syllabi of various trades are 
periodically revised by the respective Trade Comm ittees to keep pace with the rapidly changing 
technology in industry. Obsolete trades are deleted and new trades are introduced under the scheme as 
per the need of the industry.    The Ministry of Labour and Employment has proposed setting up of a National Mission for Vocational Education on which the Planning  Commission has set up a Task Force.  
 
 Recently the Ministry of Finance has announced that 1396 ITIs would be upgraded into centres of excellence in specific trade and skills unde r public-private partnership.  Under the proposed 
scheme, the State Government as the owner of the IT I, will continue to regul ate admissions and fees, 
the new management will be given academic and financial autonomy, and the Central Government 
will provide financial assistance by way of seed money.  Once a tripartite MOU is signed among the 
three stakeholders, an interest free loan upto Rs.2.5  crore to each ITI for upgradation and revision of 
courses would be granted.  The cooperation of State Governments has been sought to upgrade atleast 
300 ITIs every year, beginning 2007-08, under the PPP mode. The States are being consulted in this 
regard.  (2) T
RADE POLICY OBJECTIVES  
 Sustainable development  5. Could India provide some information about how the issue of trade and sustainable 
development fits into its overall development strate gies? Have any particular measures been taken 
since the last Trade Policy Review in 2002?   
Reply: The convergence of the trade and development agendas has been important  for India for 
achieving sustainable growth. India seeks to achiev e sustainable growth  by fostering greater 
transparency in  trade and  development of  infrastructure which helps to access the global trade. 
Appropriate amendments to the legislation concerning  environment, mining,  labour, etc. take care of 
the issue of sustainable development. WT/TPR/M/182/Add.1 
Page 126  
 
  Trade and environment  
 
6. What mechanisms does India have in place to ensure coordination of environmental policy 
and trade policy?  
Reply :  There is an Inter-Ministerial Group on Trad e and Environment which discusses and ensures 
policy coherence on trade and environmental policy issues. This Group has members not only from 
the trade and environment Ministries, but also from other Ministries such as Agriculture, Chemicals & 
Fertilizers etc. Academics are also members of  this Group. This Group commissions independent 
reports from time-to-time.  Trade and Labour 
India's Report, page 19, para. 81 The Indian report states "India has initiated a series of measures in the past few years to restructure 
the textiles and clothing industry to prepare it for a quota-free regime.  The textiles and clothing sector is labour-intensive and is the second largest em ployer in India (after agriculture). As a part of 
the overall policy of de-regulation and de-control, the Government of India has de-reserved garments, 
hosiery and knitwear from the Small Scale Industries sector."   7. How does the Indian government ensure the quality of jobs, and consequently high 
productivity, in labour-intensive sectors including the implementation of core labour standards?   
Reply:  India has ratified  42 Conventions, of which the important ones are:- 
 
1. No.29 Forced Labour Convention, 1930,     
2. No.105 Abolition of Forced Labour Convention,1957,  
3. No.100 Equal Remuneration Convention,1951 and  
4. No.111 Discrimination (Employment a nd Occupation) Convention, 1958  
 
 In order to ensure the quality of jobs, and con sequently high productivity, in labour-intensive 
sectors including the implementation of core labour standards, the Indian government is providing 
assistance for strengthening existing and opening new Apparel Training and Design Centres (ATDCs) 
to cater to the growing skilled manpower requirements at shop floor level.  The National Institute of 
Fashion Technology (NIFT) has been set up to provide  the leadership role in sensitizing the industry 
to the concept of value addition by inducting trai ned professionals to manage the industry.  The 
Government has also embarked on similar initiatives in the leather and gems and jewellery sectors to 
improve productivity and provide tr ained manpower to the industry. It has also undertaken a scheme 
for upgradation of 1396 Industrial Training Ins titutes (ITIs) for improving the knowledge and skill 
sets of workmen and supervisors in different trad es.This has resulted in an increased demand for 
trained professionals in various sectors servicing the industry. 
 
(3) TRADE
 AGREEMENTS  AND  ARRANGEMENTS 
(ii) Regional Trade Agreements WTO Secretariat's Report, page 24, para. 21 8. Could India indicate the expected timetable for notifying its new Regional Trade Agreements 
to the WTO, in particular SAFTA?  
Reply:  The process of notifying SAFTA to th e WTO has already been initiated.  WT/TPR/M/182/Add.1 
 Page 127 
 
 
  WTO Secretariat's Report, page 25, para. 22 an d WTO Secretariat's Report, page 27, para. 28 
9. Could India indicate, for both SAPTA/SAFTA and CECA, the volume and value of trade that 
the excluded products from the liberalization undertaki ngs account for? Which are these products? In 
the case of CECA, how much trade will be fully liber alized by the end of the transition period, in April 
2009?  
Reply: The details of the items for which tariff con cessions have been granted under SAPTA and the 
Sensitive Lists under SAFTA and its tariff liberalisati on programme are available at the website of the 
SAARC Secretariat (www.saarc.sec.org.)   The items not covered by SAPTA concessions and those kept in the Sensitive List of SAFTA could be traded  at normal duties in accordance with the  relevant 
foreign trade regulations.  
 
 No separate data is being maintained in resp ect of India’s  volume of trade with SAARC 
countries on preferential tariffs/duty-free tariffs and on normal tariffs.    The details of trade are 
available in the  Department of Commerce We bsite “commerce.nic.in’ under the sub-heading 
Information Dissemination/Monitoring System – Export-Import Data Bank. 
 
 As regards the Comprehensive Economic Co -operation Agreement (CECA) between India 
and Singapore, substantial trade has been covered in the trade libera lisation programme.The details of 
the tariff lines in various categories including  sensitive list are available at  the website 
www.commerce.nic.in  Steps are being taken to notify the same.  WTO Secretariat's Report, page 26, para. 26 
10. Could India indicate how bilateral trade with Sr i Lanka has evolved since the entry into force 
of the FTA in 2000? How much trade (in volume and  value terms) is currently fully liberalized?   
Reply:   The India-Sri Lanka Free Trade Agreemen t was signed  on 28 December, 1998 and has been 
in operation since 1 March, 2000.  De tails are available at the website www.commerce.nic.in 
 WTO Secretariat's Report, page 27, para. 31 
11. Has the early harvest scheme b een completed and the related 82 products fully liberalized? 
Which are these products? How does India plan to continue the liberalization process? How much 
trade and tariff lines does India intend to fully liberalize? 
Reply:  Liberalisation in 82 products under the Indi a-Thailand Early Harvest Scheme has been 
completed. Details are available at the webs ite www.commerce.nic.in.  Negotiations for a 
comprehensive FTA with Thailand are underway.  
12. In light of the ongoing negotiations with ASEAN, could India indicate how it intends to ensure 
full consistency and coherence between this new agreement and the already signed Agreements with 
Thailand and Singapore?  How does India plan to  ensure the creation of genuine building blocks? 
Reply:  India will seek coherence as far as possible betw een the bilateral agreements with individual 
countries in ASEAN and the regional trade agreem ent with ASEAN as a whole. India considers 
bilateral agreements as being complementary to the regional trade agreements and are building blocks 
of the multilateral negotiations.  WT/TPR/M/182/Add.1 
Page 128  
 
  WTO Secretariat's Report, page 35, para. 15 
 13 The EC welcomes recent Trade Facilitation refor ms in India, including the introduction of 
risk management measures. The EC would be grat eful to know why India applies preshipment 
inspection requirements to certain products, incl uding unshredded scrap and certain types of second-
hand cars.  
 Are there any plans to phase out these requirements?   
Reply: Pre-Shipment Inspection (PSI) Certificate is prescribed to ensure that imported unshredded 
scrap does not contain a hazardous substance , toxic w aste, radioactive contaminated waste/ scrap, any 
type of arms, ammunition, mines, shells, live or used  cartridge or any other explosive material in any 
form either used or otherwise and pause any security threat to the country.   PSI certificate for import of secondhand cars is required to ensure that the imported vehicle 
has been tested immediately before  shipment to India and it conforms to all the regulations specified 
in the Motor Vehicles Act 1988 of India and the rules made there under. This is also required to ensure that the said vehicle conforms to the original homologation certificate issued at the time of manufacture.   As on date, there are no plans to phase out the requirement for PSI certificate for those items 
for which it is so stipulated. 
 
14. Pre-shipment inspection is required for impor ts of textiles and textile articles. Imports of 
textiles and textile articles must be accompanied by  a pre-shipment inspection certificate stating that 
they do not contain hazardous dyes prohibited und er the Environment (Protection) Act 1986. Pre-
shipment inspection certificates are provided by  99 recognized certifying agencies, including several 
based outside India. 
Does India recognize test results from testing l abs in any country having recognition for certification 
purposes by the National testing authority of that co untry which in turn is a member of ILAC? In this 
case, would a pre-shipment certificate be required?    
Reply: Pre Shipment Inspection Certificate is requi red even in cases where the National testing 
authority is a member of ILAC  
WTO Secretariat's Report, page 38 , para. 21 
 
It is stated that rates are changed on an ad-hoc ba sis through gazetted notificat ions. This leaves a lot 
of uncertainty for the actors on the market.  
Reply:  No changes in the tariff are made in an ad -hoc manner.  Rates are decided taking into 
consideration the needs of a particular segment of  industry, to augment supply, to keep prices in 
check, and other relevant factors.  The system is completely transparent as all such notifications are 
placed in both the Houses of Parliament, published in the Gazette and are also put on the departmental 
website. (www.cbec.gov.in) 
 
15. Does India intend to keep the 2007/08 applied rates as they are without changes during that 
period?   
 Reply:  It is not possible to comment on any duty changes in the future. 
  WT/TPR/M/182/Add.1 
 Page 129 
 
 
  WTO Secretariat's Report, page 38 , para. 22 
 
India has only bound 75% of its tariffs in the WTO. 
 16. Does India intend to achieve 100% binding of its tariffs in the WTO?   
 
Reply :   India would abide by the modalities including the binding coverage for developing countries 
negotiated by the Ministers under the NAMA negotiations.  
WTO Secretariat's Report, page 44 , para. 34 
 
India levies additional duties in lieu of domestic taxes.  17. What is the rational behind that and why can imports not be taxed in the same way as 
domestic products? What domestic taxes exactly are recalculated into additional duties for 
importers?   
 
Reply:  Paragraph 2 of Article II read with para graph 2 of Article III of GATT 1947 permits 
imposition on imported products of a charge equivalent to internal taxes or other internal charges 
applied, directly or indirectly, to like domestic  products. These internal taxes include excise duty as 
well as provincial/ local taxes. 
 
In addition to tariffs India imposes several other taxes on imports. India's tariff structure and duty 
calculation still remains quite complex and not easy to follow. The calculation of the full importing 
cost is essential for importers making appropriat e decisions when trading. The EC welcomes a 
recently launched single informa tion point for textiles, which provides important information 
regarding tariffs, rates and fees applied for textiles.  
 18. Could India indicate whether this initiative will be expanded to other sectors?    
 
Reply:  The expansion of a single information point to other  sectors  is yet  be initiated. 
 19. Is there already any single information point wh ere all tariffs, rates, fees, at national and 
regional levels are set out? Are there any other meas ures taken or being pre pared to address this 
complex system?  
 
Reply: At the national level information is available at the website of the Department of Revenue 
http://www.cbec.gov.in. 
 
India's very high import levies on beer represent an im portant barrier to trade. For beer containing 
alcohol as well as for mixed beverages including be er containing alcohol, to tal charges on imports 
amount to more than 300% of the import value. However, India bound its tariffs on beer at 150% during the Uruguay Round. As is the case for win es and spirits, India's import levies on beer are 
apparently not consistent with India's WTO obligations.  
 20. Could India provide some comments on this situation and also explain what measures are 
envisaged to end the apparently WTO-incons istent treatment of imports of beer? 
Reply: Tariff on wines and spirits do not exceed the boun d rate.  The additional duty charged is in 
lieu of state excise duties levied on wines and spirits.  It would, however, not be  desirable to make any 
further comments as the matter is now with the Dispute Settlement Body in the WTO. 
 WT/TPR/M/182/Add.1 
Page 130  
 
  21. India's report notes that the only remaining q uantitative restrictions are those necessitated 
under Article XX and XXI of GATT. However, the EC understands that there are still some licensing 
restrictions for products such as marble, printing paper and stone. 
Could India explain the justification for these restrictions and comment on their future liberalisation?  
 
Reply: Licensing restrictions on marble and stone are being maintained for conservation of 
exhaustible natural resources and licensing restric tions on printing paper are being maintained on 
security considerations. At present, there is no prop osal under consideration for liberalization of these 
restrictions.  
 
22. We would be interested in further information on India's licensing regime. 
Could India explain which restricted imports are subject to licensing and how fees for licences are 
calculated?  
Reply:  The items which are restricted for imports are available in the ITC (HS) Classifications of 
Export and Import Items, 2004-09.    The application fee for an import licence is Indian Rupees (INR) 
2 per INR 1000 of CIF value of the goods specified in the application or part thereof subject to a 
minimum of INR 200 and maximum of INR 1,50,000. Ho wever, for applications filed electronically, 
the fee is Rs.1 per INR 1000 of CIF value or pa rt thereof subject to a minimum of INR 200 and 
maximum of INR 75,000.  
23. Machines older than 10 years are excluded from the general import regime regardless of 
their actual state, type and their previous and in tended users. India's licensing system demands a so-
called "product machine life expectation certificate" , which cannot in practice be given by the 
manufacturer or the trader. Therefore, the measu re could lead to total abolition of imports. 
 Will India amend its import licensing syste m for trade of second-hand machinery?  
Reply: Second hand machinery which falls under the defi nition of Capital Goods is free for import 
without any age restrictions. The import of re furbished / reconditioned spares are allowed on 
production of a Chartered Engineer’s certificate that su ch spares have at least 80% of the  residual life 
of the original spare. As on date there is no propo sal for amending the regime for the import of second 
hand machinery.  WTO Secretariat's Report, page 47, para. 50  According to the Report, India has imposed final safeguard measures on only one case (Epichlorohydrin).  However, the EC notes anoth er case (Tapioca Starch) against which a safeguard 
duty is in place.  The safeguard duty was im posed through Customs Notification 40/2005-Customs 
dated 2nd May 2005.  The duty is in force until 1 May 2008.   
 24. Could India clarify this issue?  
 
Reply:  Yes, safeguard duty has been imposed on tapioca starch vide Customs Notification 40/2005-
Customs dated 2nd May 2005.  The duty is in for ce until 1 May 2008.  Details are available at 
http://www.cbec.gov.in/customs/cs-act/notifications/notfns-2k5/cs40-2k5.htm 
 
xi) Standards and other technical requirement 
 
WTO Secretariat's Report, pages 52-53, Para 48-55 
  WT/TPR/M/182/Add.1 
 Page 131 
 
 
  25. What is the legal basis, process and ins titutional structure for developing technical 
regulations (Ministries in charge ; role of sub-federal entities)? 
 
Reply:  The technical regulations for products under mandatory certification are issued through 
notifications/ QC Orders by the concerned Ministries dealing with the product (s) in consultation with 
other Ministries/Departments concerned. For example, the Ministry of Health & Family Welfare is 
responsible for formulating technical regulations and guidelines for Packaged Drinking Water, food 
products etc. The Ministry of Consumer Affairs, Food & Public Distribution is the nodal ministry for coordinating mandatory BIS certification.  
Technical regulations are brought out by different Ministries/Departments under various legislations 
as given below: 
1. The Prevention of Food Adulteration Act, 1954 (37 of 1954) 
2. The Fruit Products Order, 1955 
3. The Meat Products Order, 1973 
4. The Vegetable Oil Products (Control) Order, 1947 
5. The Edible Oils Packaging (Regulation) Order, 1998 
6. The Solvent Extracted Oil, Deoiled Meal and Edible Flour (Control) Order, 1967 
7. The Milk and Milk Products Order, 1992 
8. The Standards of Weights and Measures Act, 1976 (60 of 1976) (The Packaged 
Commodity Rules, 1977) 
9. The Infant Milk Substitutes, Feeding Bottles and Infant Foods (Regulation of Production, 
Supply and Distribution) Act, 1992 (41 of 992) 
10. Any other order issued under the Essential Commodities Act, 1955 (10 of 1955) relating 
to Food. 
 
26. What is the relation between standards and technical regulations ?   
 Reply:  A standard is a document that provides guide lines or characteristics of products or related 
processes of production and test methods, compliance of which is voluntary.  
  A technical regulation lays down product ch aracteristics or their related process and/or 
production methods including the applicable admi nistrative provisions, with which compliance is 
mandatory. Technical regulations are normally prep ared by the concerned Ministries/Regulators and 
for the purpose of their implementation, provide a cr oss-reference to the relevant Indian standard 
(wherever required).  
The EC considers the list of products subject to mandatory conformity assessment to be 
discriminatory against imported goods.   
 27. Could India clarify its choice of products s ubject to mandatory conformity assessment and 
indicate if products meeting interna tional standards are accepted?   
 
Reply:  As per the existing government regulations, the products conforming to mandatory Indian 
Standards and certified by BIS are accepted. Certain products are brought under mandatory 
certification on the grounds of health, safety, environment, infrastructure and mass consumption.  WT/TPR/M/182/Add.1 
Page 132  
 
  WTO Secretariat's Report, page 52, Para 52 
 
28. Regarding setting standards or formulating legisl ation, could India explain its framework for 
stakeholders' consultations, including importers and non-domestic companies estab lished in India?    
 
Reply:  Procedure for the Establishment of an Indian Sta ndard is given in  Chapter III, clause 6 of BIS 
Rules, 1987 and the status of an Indian standard in cluding consultation with st akeholders is given in 
Chapter III, clause 7 of BIS Rules, 1987. Hy perlink : http://www.bis.org.in/bs/index.htm. 
  Standards are formulated through Technical Committees, which have representatives of 
different stakeholders such as manufactuers, cons umers, testing labs, R&D institutions etc. This 
would also include non-domestic companies and importers established in India.  
WTO Secretariat's Report, page 52, Para 53 
 
The Report of the Secretariat states that there a re currently around 18300 standards in India. 4307 
(23.6%) of these are harmonized with ISO/IEC st andards. According to the data of the previous TPR 
(2002), as of April 2001, 17% of Indian standards  were harmonized with ISO/IEC standards. Over 6 
years there has only been a 6.3% increase in the number of harmonized standards.  
 29. Is there any particular policy aimed at increasi ng the number of Indian standards harmonized 
with ISO/IEC ones? (BIS) 
 
Reply:  BIS lays emphasis on the harmonization of Indian standards with ISO/IEC standards.  This is 
taken up through the Technical Committees of BIS.  These Committees consider ISO/IEC standards as 
basic documents  (if available on the subject). Sta ndards are then formulated based on a consensus of 
stakeholders agreeing on the document which is ba sed on ISO/IEC standards or with modifications 
for local conditions.  
WTO Secretariat's Report, page 52, Para 54 
 30. Could India please elaborate on the criteria used by the Bureau of India Standards (BIS) 
when assessing awards of the ECO-MARK to en vironmentally friendly products? Does the BIS 
endorse private environmental standards whic h are 'equivalent' with its own award?  
 
Reply:  BIS  grants licences to environment friendly products under a special scheme and awards the 
ECO MARK to such products. These products should conform to additional re quirements specified in 
the Indian Standards to qualify. 
 
The Report states that certification has b een made mandatory for 66 products.  
 
31. Could India provide a list of the 66 products that require mandatory certification and give the 
most up-to-date figure? Has this figure increased or decreased in comparison to last year? What is 
the estimate for the next year?  
 
Reply:  Presently, there are 68 products which are unde r mandatory certification. The list of these 
products is available at the BIS Website: www.bis.or g.in. The figure has decreased in comparison to 
the last year. The products which affect consumer health, safety, environment, infrastructure and are 
of mass consumption are brought under mandatory certification.  
  There is no target/ estimate of the products to be brought under mandatory certification. 
  WT/TPR/M/182/Add.1 
 Page 133 
 
 
  32. Could India confirm whether certification is compulsory for 66 products out of 
18,300 standards? (Is it to be understood that out of 18,300 standards 66 need mandatory certification? Please explain.)  
 
Reply:  Presently, there are around 18,300 standards out of which around 8300 are product standards. 
Out of these product standards, 68 product standards are compulsory. The list of 68 product standards 
under mandatory certification is attached at Annex A.  The list of mandatory products is available at 
the BIS website: www.bis.org.in.    60 licences of production facilities have been granted by BIS in 15 countries. 
 
33. Are any of these facilities located in the EC?  
 
Reply:  Presently, there are 65 licences which ar e in operation under the Foreign Manufacturers 
Scheme of BIS in different countries. There are 11 licences which are located  in European Countries 
namely Germany (2), Greece (1), France (3), Hungary (2), Italy (1), Poland (1), Switzerland (1). The 
list of such products is available at the BIS website: www.bis.org.in.  
34. Does the renewal of licences also require factory visits by BIS? 
 
Reply : The renewal of the licences is not linked to fact ory visits. However, surveillance visits are paid 
to the licenesees’ premises to verify the operation of  Scheme of Testing & Inspection, testing in the 
factory  and drawal of samples for independent tes ting, etc  during the normal operation of the licence. 
 
The EC understands that India's new (voluntary) sta ndard on tyres differs from the international tyre 
standard (UN-ECE Regulation).  
 
35.  Can India indicate whether it is considering harmonising its standard with that of the UN-
ECE and confirm that its national standard will not be made mandatory until fully aligned with the 
UN-ECE Regulation and that it w ould accept the "E" mark as proof of  conformity? (The "E" mark is 
accepted in over 40 countries.)   
Reply: The proposal for mandatory certification of Pneu matic tyres for two and three wheeled motor 
vehicles, Pneumatic tyres for passenger and commerc ial vehicles and pneumatic tubes for commercial 
vehicles is under consideration. The relevant WTO/ TBT notification was issued on 17 July 2006 and 
last date for comments was 15 September 2006.  36. Has India made an analysis on the impact on imports  by having a standard that is different to 
an international standard?   
Reply:  Indian standards are prepared taking into account the conditions prevailing in India. The 
concerned technical committee takes due cognizance of the Internationa l standards and deviations for 
local conditions, if required, are made irrespective of the impact the standard may have on imports. 
 
The EC is further interested in In dia's homologation rules for cars. 
37. Would India be ready to sign the UN-ECE 1958 Agreement for reciprocal certificates for the 
import of vehicles and their components?   
Reply:  There is no such move at present. 
 
38. Could India provide information on its capacity to test for exhaustive emission requirements?  
 WT/TPR/M/182/Add.1 
Page 134  
 
  Reply: The facilities for testing motor vehicles / engin es for compliance with the relevant Indian 
norms are available at Automotive Research Associ ation of India (ARAI), Pune and International 
Centre for Automotive Testing (ICAT), Gurgaon a nd are adequate to cater to India’s current 
requirements. The facilities are exp ected to be augmented / upgraded to cater to the requirements of 
Euro IV norms and beyond.  
 
 The Department of Heavy Industry is impl ementing the National Automotive Testing R&D 
Infrastructure Project.  Under the project, the following facilities are being set up at various centers across the country:-  
1. State of Art testing, certification and homologation centers at Manesar & Chennai 
(emission testing facilities available)  
2. Up-gradation of ARAI, Pune (emission t esting facilities available) and Vehicle 
Research & Development Establishment (VRDE),  Ahmednagar 
3. World-class proving grounds - Pithampur  
4. National Center for Testing of Tractors and Off-Road Vehicles - Rae Bareilly 
(emission testing facilities available) 
5. National facility for accident data analysis and specialized driving training - Rae 
Bareilly 
6. National Specialized Hill Area Driving Training Center – Silchar. 
 
 The facilities under National Automotive Testing R&D Infrastructure Project ( NATRiP) will 
be available by the year 2008-09.  These centers will be  able to cater to the requirements of testing up 
to Euro V norms.    Besides the above, testing facilities are availa ble at Vehicles Research Development VRDE 
(Ahmednagar); Indian Institute of Petroleum (IIP),  Dehradun and Central Farm Machinery Training & 
Testing Institute (CFMTTI), Budni.  
WTO Secretariat’s Report, page 54, para. 57 
 
39. Could India inform when the Food Safe ty and Standards Act 2006 and its implementing 
instruments will come into force and explain what  differences will be introduced to both standards 
and procedures as a result of the new Act?  
Reply:  The Food Safety and Standard Act, 2006 has b een passed by the Parliament and is being 
notified for its implementation. 
 
40. Could India confirm that the basis of its ani mal and plant health and food safety standards  
will be those  set down  in the OIE, IPPC and Codex  Alimentarius? 
 
Reply:  The SPS measure(s) in force are based on scientif ic principles of risk analysis and on the lines 
of well recognized international standards including those of codex, OIE etc. 
 
The EC notes that India has prohibited the importatio n of a wide range of an imal products apparently 
to protect from the risk of introduction of avian influenza.  The EC notes that these go considerably 
beyond the recommendations of OIE, and also would li ke to inform India that most EC Member States 
are free from this disease. 
 
41. Could India provide full details of th e scientific justification for its measures? 
 
Reply:  India’s Measures in response to the outbreak of Avian Influenza (AI) in various parts of the 
world have been undertaken after consultation with  technical experts and after carrying out detailed  WT/TPR/M/182/Add.1 
 Page 135 
 
 
  risk analysis on scientific lines. Avian Influen za, both highly pathogenic and low pathogenic in 
poultry/wild/migratory birds and other species, h as been reported from more than 60 countries across 
four continents of the world. It has recurred in several countries in 2006 and is spreading rapidly in 
2007 also. The disease has grave human health implic ations. Countries across the world have adopted 
measures to safeguard their animal and human health from this disease. India has also taken 
appropriate measures to prevent the outbreak of Avian Influenza in the country including putting 
restrictions on the import of livestock/livestock products from Avian Influenza positive countries, 
which could pose a risk of bringing in AI infection in India.    Regarding the contention of the EC that certain EC Member States, free of AI disease, it is 
clarified that before recognizing a country as being free of AI, India takes into consideration all the 
relevant information as per Article  2.7.12.3 of OIE Terrestrial Animal Health Code 2006 including the 
steps/measures undertaken by the country to  declare freedom from Avian Influenza. 
 
42. Does India plan to accelerate its notification pr ocess to SPS Committee so as to comply with 
its outstanding notification obligations?  
Reply: SPS measures are being regularly notified to WTO for information and comments by other 
member countries. The recent examples are Avian Influenza related notifications G/SPS/N/IND/46/Add.1 and G/SPS/N/IND/46/Add.2 dated 19.2.2007 and 17.4. 2007 respectively on 
the WTO website. 
 
xiii) Labelling  
 
There is no express mention in the Report to the Standards of Weights and Measures (Package 
Commodities) Rules ,that require all packaged pr oducts to carry among others Maximum retail sales 
price –including all taxes ,freight ,transport char ges ,commission payable to dealers and all other 
charges including for advertising ,delivery and packi ng. For imported products India requires that 
they are labeled with the Maximum retail price (M RP) in the country of origin prior to custom 
clearance. This is not feasible as calculati ons are based on several products including freight 
insurance and internal taxes. The co sts vary from State to State whic h means that the calculation of 
the MRP before customs clearance is extremely difficult 
 
43. Is India considering any measures to address the issue and if not why not? 
 
Reply:  The provisions of the Standards of Weights and Measures (Packaged Commodities) Rules, 
1977 provide  that the manufacturer/importer , declar e on the Package or on a  label securely affixed 
thereto , among other things , retail sale price in the form , Maximum Retail Price   Rs.. (inclusive of 
all taxes).  The Rules do not stipulate that the labe ling should be done in the country of origin. The 
responsibility for ensuring compliance to the Rules,  before the imported packages are cleared at the 
port, rests with the importer. The Rules are a pplicable equally to indigenously manufactured  
packages as well as imported packages.  
 44. Do the rules of the General Financial Rules (GFRs) also apply to public-private 
partnerships?  
Reply:  General Financial Rules are a compendium of general provisions to be followed by all offices 
of the Government of India while dealing with matte rs of a financial nature. There is no mention of a 
public–private partnership in GFRs. 
 
45. Does the term “open tender” under GFRs, as revi sed in 2005 mean that not only domestic but 
also foreign suppliers are eligible to participate in a tender? What is the difference between “open 
tenders” and “global tenders”? WT/TPR/M/182/Add.1 
Page 136  
 
  Reply:  As per GFRs 2005, invitations to tenders by ad vertisements should be used for procurement 
of goods of estimated value of Rs.2.5 million and above so as to get a wide response.  This advertised 
tender enquiry is called an open te nder enquiry. This is usually in the domestic context. Where the 
Ministry/ Department feels that it is necessary to look for suitable competitiv e offers from abroad, the 
requirement is publicized globally. Publicizing th e requirement globally is known as advertising a 
global tender enquiry. 
 
46. Which criteria are used when determining that  it is not in the public interest to procure goods 
through open tender, and thus to use limited te ndering. Who takes such a decision, and can it be 
appealed before an independent review body? 
 
Reply:   Different Ministries and Departments have  been delegated powers to make their own 
arrangements for the procurement of Goods. De pending upon the delegati on of financial powers 
Ministry or Departments can procure items th rough a limited tender or an open tender. For 
procurement of Goods of estimated value of Rs.2 .5 million and above, open tenders are generally 
invited. Limited tender enquiry is normally adopted only when the estimated va lue of the goods to be 
procured is upto Rs.2.5 million. However, purch ase through a limited tender enquiry can be adopted 
even where the estimated value of procurement is  more than Rs. 2.5 million, in the following 
circumstances:   
(a) The Competent Authority in the Ministry or Department certifies that the demand is 
urgent and any additional e xpenditure involved by not procuring through advertised 
tender enquiry is justified in view of urgency.  The Ministry or Department should also put 
on record the nature of the urgency and reasons why the procurement could not be anticipated.  
(b) There are sufficient reasons, to be recorded  in writing by the Competent Authority, 
indicating that it will not be in public inter est to procure the goods through advertised 
tender enquiry. 
(c) The sources of supply are definitely known and possibility of fresh source(s) beyond 
those being tapped is remote.  
 
 While recording the reasons that it will not be  in the public interest to procure goods through 
advertised tender enquiry, the Competent Authority takes into account how emergent is the demand, 
there should be no delay in procurement and it would be in the general interest of security to invite 
limited tenders.   Although there is no independent review body wher e appeal can be preferred, such decisions 
are subject to scrutiny by audit done by Constituti onal Body like Comptroller and Auditor General to 
ensure transparency and accountability in Government procurements.  
47. Who evaluates, and on what basis, whether “the possibility of additional suppliers being 
tapped is deemed to be remote”? 
 Reply:  The Competent Authority, who has been delega ted the power of procurement, evaluates and 
decides the likely possibility of fresh sources (add itional suppliers) beyond thos e being tapped. This is 
decided by the Competent Authority in cases where it has been ascertained from past 
experience/inquiry that there would be no supplier other than known and definite sources, to supply a 
particular item. 
  WT/TPR/M/182/Add.1 
 Page 137 
 
 
  WTO Secretariat's Report, page 57, para. 70 
 The Report states that "in principle, there is no preference for domestic as opposed to imported 
goods" for procurements under rate contracts by th e Directorate-General of Supplies and Disposals 
(DGS&D) in the Department of Commerce. 
 
48. Does this mean that in certain  instances there are, however,  preferences for domestic goods? 
If so, which are these instances?    
Reply:  As per Govt present policy, 358 items are r eserved for exclusive purchase form the Small 
Sector Industry. For other items the Small Scale units are entitled to price preference up to 15% over 
the quotations of large scale units. Also Public Sector units are entitled to purchase preference over 
large scale units, subject to certain limitations  
49. Could India explain what it means that products  purchased by the DGS&D "must be 'suitable 
for use' in India"? 
 
Reply:   The products purchased by DGS&D for Cent ral Govt Departments/ Ministries should be 
suitable to work in the environmental conditions ob taining in India.  The firms should have proper 
after sales support; proper maintenance facilities and warranty back up in India.  WTO Secretariat's Report, page 58, para. 71  50. Is the use of international technica l standards, where these exist, mandatory?  
 
Reply:  Products are purchased by the DGS&D in conformity  with BIS standards, wherever available.  
BIS standards are developed generally after taking  into consideration the relevant international 
standards and the environmental conditions in India.  Wherever the BIS standards are not available, 
the technical specifications are finalized in consultation with the stake holders/Industry. 
 
51. Which registration requirements do suppliers have to comply with in order to be eligible for 
tendering with the DGS&D? Does the DGS&D recogni ze as equivalent a supplier's technical 
expertise based on activities pursued outside  India? How many non-Indian suppliers have 
successfully registered with the DGS&D? Is regi stration with the DGS&D a pre-requisite for 
registering with other procuring entities?   
Reply:   DGS&D is presently concluding rate contract s for common user items.  A supplier should be 
registered with DGS&D or NSIC for the products offered. For imported products, DGS&D also takes 
into consideration suppliers’ activities pursued outsi de India.  DGS&D is also registering foreign 
suppliers, Indian Agents of Foreign Suppliers and Stockists of Foreign Suppliers besides registering 
indigenous manufacturers.  Each department in the Govt of India has its own tender procedure. 
  Some of the departments prescribe eligibility criteria in their tender enquiries. 
 
WTO Secretariat's Report, page 58, para. 72 and 75 
 52. Which requirements do suppliers have to comply with  in order to be eligible to participate in 
electronic tendering? 
 
Reply:   The vendors should possess valid digital signatur es and should be registered with ASP to use 
its e-tendering platform. There is no distinction in  this procedure between indigenous or foreign 
suppliers.  WT/TPR/M/182/Add.1 
Page 138  
 
  WTO Secretariat's Report, page 58, para. 73 
 
53. Can India confirm that under the current law,  all purchasing preferences for central public 
sector enterprises will automatically expire by 31 March 2008?  
 Reply:  Para 1 (i) of the existing guidelines issued by the Department of Public Enterprises on 
18.7.2005 states inter alia that the Purchase Prefer ence Policy will be terminated with effect from 
31.3.2008. Since this is a guideline, it does not have the force of law.  
54. Which are the award criteria employed by India?  
 
Reply:  The criteria for awarding contracts under the Purchase Preference Policy (PPP) have been 
stipulated in Para 1 of the policy guidelines date d 18.7.2005, which can be viewed at the website: 
www.dpe.nic.in, under the link “Guidelines”.  WTO Secretariat's Report, page 58, para. 74 
 
55. What is the level of "earnest money" (de posits) which tenderers have to pay, and how are the 
relevant amounts calculated? (Ministry of Small Scale Industries) 
 
Reply: The earnest money deposit for each tender is norma lly stipulated in the notice inviting tenders. 
Different agencies of the Government have come out with guidelines to calculate the earnest money 
deposits relating to their tenders.  
WTO Secretariat's Report, page 59, para. 76 
56. Which rules apply to public purchasing by entiti es in the utilities, such as for the generation 
and distribution of electricity, gas, oil and wat er, as well as in the transport sectors?   
 
Reply:  All commercial operations by the public sector entities in the utilities in the oil and natural 
gas sector, irrespective of the intended end consum er for the products, are subject to the general 
procurement procedures applicable for public sect or entities. Such procedures however are not 
applicable for private sector entiti es in the utilities in the oil and natural gas sector, who adopt their 
own procedures for procurement. 
 
(iii) Export taxes 
WTO Secretariat's Report, page 61, para. 85 
 
While noting that leather has been removed from the reserved items list for SMEs, the EC wishes to 
stress the very high level of export duties maintained by India on exports of hides and skins (10% to 
25% of the f.o.b. value of the product).  This practi ce is very deleterious to the leather sector and to 
its competitiveness while not being particularly help ful to the country main taining such duties. 
 
57. Could India explain its plans and time line for the dismantling of the export duties in this 
sector? 
Reply:  There are no plans at present to make an y changes in the export duty regime. 
 
The EC would like to draw the attention to the recent introduction by Indi a of an export tax on iron 
ore (Rs 300 per tonne). Although this measure has b een in place for only few months, it has already 
seriously disturbed global trade of this commodity.  In light of the latest press reports, the EC 
understands that India is considering to  review the export tax on iron ore.  WT/TPR/M/182/Add.1 
 Page 139 
 
 
  58. Could India explain its plans regarding the expor t tax on iron ore? Is India considering the 
removal of this measure?  
Reply:  Export duty on iron ore has been imposed to preserve natural resources and raise revenue.  
Such export duties are not inconsistent with the WTO provisions. However, vide notification No. 
62/2007-Customs, dated 3.05.07, export duty on ir on ore fines of iron content 62% and below has 
been reduced from Rs. 300 per metric tonne (P MT) to Rs. 50 PMT. (may be viewed at 
www.cbec.gov.in).  
(ii) Taxation and non-tax assistance 
WTO Secretariat's Report, page 74, para. 119-121 
 
India’s tax regime is complex and burdensome for traders.  59. Are there any measures taken or being prepared to address this issue?  
 Reply:  India’s tax regime is fairly simple and transp arent. Most of the non-agricultural goods attract 
a uniform tariff. In addition, imported goods are ch arged additional duties in lieu of excise duty and 
state/local taxes.  
The recently announced annual supplement to the Foreign Trade Policy included a service tax 
exemption to exports. However, there seems to be uncertainty regarding the beneficiaries of the 
measure in question as it is not clear whether th e measure will apply to both goods and services.  
 60. Could India clarify this issue?  
 
Reply: There is already an exemption available for e xport of taxable services in terms of the Export 
of Services Rules, 2005, available at http ://www.servicetax.gov.in/st-rulemainpg.htm. 
  Neutralization of indirect taxes is available for input services through various schemes like drawback.   Internal consultations are on to work out a mechanism for rebate of service tax when the 
services are used for both export as well as for other purposes. 
 
(v) Intellectual Property Rights 
 WTO Secretariat's Report, page 84, Para 153 
 
According to the statistics of the Federation of Indian Chambers of Commerce and Industry, fake 
medicines are estimated to occupy between 15% to 20% of the total Indian market; 60% of motion picture and 40% of music industry’s production ends being copied and distributed illegally in India, 
one in three automotive parts are copied, 10% of major soft drinks are fake and 10%-30% of 
cosmetics, toiletries and packaged food are counterfeited.   
 
61. What measures has the government  taken to address this issue? 
 
Reply:  India has taken a number of initiatives to streng then IP enforcement during the last few years. 
These include appointment of Nodal Officers by State Governments to coordinate anti-piracy 
operations, creation of separate anti-piracy cells in the State police organizations, holding of special 
training programmes for enforcement agencies such  as customs, police, etc., conducting general WT/TPR/M/182/Add.1 
Page 140  
 
  awareness seminars and workshops for IP stakeholders  such as industries, scien tists, other academics 
and the general public and organiza tion of colloquiums for judges. 
  Enforcement of intellectual property rights in India is carried out by the police for domestic cases and by the police and customs for imports and exports. Domestic enforcement, especially for 
copyright violations have been stepped up, notabl y through the establishment of special intellectual 
property rights cells in most States as well as thr ough the nodal officers who coordinate enforcement 
activities with industry. IPR cells set up by the Stat e Governments for enforcem ent of IP rights deal 
with all types of IP violations including Trade Marks, Patents, Designs, Copyrights, Geographical 
Indications, etc. 
 
 The National Crime Records Bureau collects statistics on counterfeiting and piracy cases.  During January to June 2005, a total of 2,108 copy right infringement cases were registered as against 
1,211 during the same period in 2000 and arrested  over 2,000 offenders, seized material worth Rs. 93 
million. Indian Music Industry (IM I) conducted 2100 raids in which 2255 arrests were made in 2005-
06 in music related piracy cases.   
  The Copyright Advisory Enforcement Council provides advice to the Government on improving enforcement of copyright. Enforcement by the police has been stepped up through the increasing use of ex-officio raids since 2004.  As a result some 6,290 cases were filed in 2004 with the 
National Crime Records Bureau (compared to 1,211 cases of copyright infringement in 2000); most of 
these cases relate to copyright and trademark infringement.  
  The relevant sections of the IP right holders ha ve come together by forming associations in 
the Fast Moving Consumer Goods (FMCG) sector - the music and entertainment sector, the pharmaceutical industry etc. recognizing the gravity of the problems and to identify the necessary 
steps they have to take to tackle the issues.  Regular seminars, workshops and training programmes 
are being organized for enforcement agencies such as police, customs, etc. to sensitize them about IP 
issues and also about the steps to be taken by them to fight counterfeiting and piracy.   The police are vigilant and prompt in taking suitable action, immediately upon receipt of the complaints from the right holders.  Search of pr emises, seizure of duplicat e, fake and counterfeit 
products, arrests of the offenders, with sufficien t publicity in the print and electronic media are 
regularly carried out successfully.  Most police departments are now equipped with a separate cell with regard to cyber crimes which includes amongst other issues the sale and distribution of pirated 
goods.  
 The Government has also stepped up training to increase awareness of intellectual property 
rights enforcement. The Intellectual Property Training Institute (IPTI) provides training to government officials (including from the Intell ectual Property Offices and from other government 
agencies), employees in the private sector, including management levels creators of IPRs and academics, and to “potential users from the public at large”.  Special modules on IPRs have been 
included in the induction training programmes at the Customs and Police Academies. 
 
 An Inter-ministerial Coordination Committee on Intellectual Property Enforcement Issues has 
been set up with members drawn from various Gove rnment Departments concerned with IPR matters, 
namely the Department of Industrial Policy an d Promotion, the Department of Information 
Technology, the Department of Higher Education,  the Department of Agriculture and Cooperation, 
the Department of Commerce, the Department of Health and Family Welfare, the Ministry of 
Information and Broadcasting, the Ministry of Home Affairs, the Central Board of Excise and 
Customs and the National Crime Records Bureau . During the meetings of the Coordination 
Committee, broad issues in the context of cont inued emphasis on enforcement are discussed. The 
Committee holds its meeting once in a quarter.  WT/TPR/M/182/Add.1 
 Page 141 
 
 
  62. Could the Indian authorities elaborate on the po licy issues at stake and their proposed course 
of action?  
 
Reply: India follows the global norms for determining pa tentability, i.e., novelty, inventive step and 
industrial applicability. This definition has been used particularly to ensure that no frivolous patent is 
granted and ever-greening of the patent is prevented.  
  Discovery is not considered patentable. To be patentable, an invention should have an 
intellectual contribution. Section 3(d) prevents gran t of frivolous patents for new forms or new usages 
of known substances.  Section 3(d) lawfully incor porates safeguards by strictly defining standards of 
patentability for pharmaceutical products so as to excl ude minor variations of existing medicines that 
do not add significantly to therapeutic efficacy.    
 
Explanation to section 3(d) has been added to  prevent ever-greening of the patent. The 
Explanation clearly differentiates between the disco very of a new form of the known substance and 
the known form of the substance. To qualify for patentability, the new form of the known substance 
should differ significantly in properties with regard to known efficacy. 
 
63. Can India indicate which measures have b een taken to prevent abusive use of pre-grant 
opposition to delay or even prevent the granting of a patent?   
64. For example, does India envisage introducing measures that would ensure that the patent 
application enjoys preliminary patent protection until the granting of the patent?   
Reply to Qs 63 & 64:  The system of pre-grant opposition is followed in a number of countries. The 
amendments in the Patents Act in 2005 simplifie d the procedure for pre-grant opposition. Earlier it 
was a time consuming, quasi-judicial process. The amended law provides for an administrative 
procedure which is simple, fast, and efficient and is  in accordance with princi ples of natural justice. 
Against this administrative order, an appeal can be filed with the Intellectual Property Appellate 
Board (IPAB) as per Section 117A of the Patents Act.  In any case, so far the number of pre-grant opposition has been negligible; only 199 against 50,295 publications. In the case of post-grant 
opposition also the decision of the Controller can be challenged through an appeal before the IPAB. 
 
According to Article 39(3) of the TRIPS Agreem ent, WTO Members shall ensure protection against 
unfair use of clinical test data submitted to public authorities for the purpose of obtaining marketing 
authorisation of pharmaceuticals.   
65. Can India indicate which measures have been taken to comply with  this obligation?  
 
Reply:  India is presently examining the extent of ch ange that would be needed to give protection 
against the unfair use of clinical test data submitted to the public aut horities for the purpose of 
obtaining marketing authorization of pharmaceuticals . 
 
India's Report, page 30, para. 148  
 According to Article 39(3) of the TRIPS Agreem ent, WTO Members shall ensure protection against 
unfair use of clinical test data submitted to public authorities for the purpose of obtaining marketing 
authorization of pharmaceuticals.  
 
The report states that the enforcement of IPR law is the concern of State Governments and that the 
Central Government has set up an Inter-Ministerial Coordination Committee on Intellectual Property Rights Enforcement Issues to have a focused approach.  WT/TPR/M/182/Add.1 
Page 142  
 
  66. Could India provide more information about  the operation and work of this Coordination 
Committee?  Furthermore, what data is availabl e o n the enforcement of IPR across the States?  
 
Reply: India has taken a number of initiatives to strengt hen IP enforcement during the last few years. 
These include appointment of Nodal Officers by State Governments to coordinate anti-piracy 
operations, creation of separate anti-piracy cells in the State police organizations, holding of special 
training programmes for enforcement agencies such  as customs, police, etc., conducting general 
awareness seminars and workshops for IP stakeholders  such as industries, scien tists, other academics 
and the general public and organiza tion of colloquiums for judges. 
 
 Enforcement of intellectual property rights in India is carried out by the police for domestic 
cases and by the police and customs for imports and exports. Domestic enforcement, especially for 
copyright violations have been stepped up, notabl y through the establishment of special intellectual 
property rights cells in most States as well as thr ough the nodal officers who coordinate enforcement 
activities with industry. IPR cells set up by the Stat e Governments for enforcem ent of IP rights deal 
with all types of IP violations including Trade Marks, Patents, Designs, Copyrights, Geographical 
Indications, etc.   The National Crime Records Bureau collects statistics on counterfeiting and piracy cases.  During January to June 2005, a total of 2,108 copy right infringement cases were registered as against 
1,211 during the same period in 2000 and arrested  over 2,000 offenders, seized material worth Rs. 93 
million. Indian Music Industry (IM I) conducted 2100 raids in which 2255 arrests were made in 2005-
06 in music related piracy cases.     The Copyright Advisory Enforcement Council provides advice to the Government on improving enforcement of copyright. Enforcement by the police has been stepped up through the 
increasing use of ex-officio raids since 2004.  As a result some 6,290 cases were filed in 2004 with the 
National Crime Records Bureau (compared to 1,211 cases of copyright infringement in 2000); most of 
these cases relate to copyright and trademark infringement.    The relevant sections of the IP right holders ha ve come together by forming associations in 
the Fast Moving Consumer Goods (FMCG) sector - the music and entertainment sector, the 
pharmaceutical industry etc. recognizing the gravity of the problems and to identify the necessary 
steps they have to take to tackle the issues.  Regular seminars, workshops and training programmes 
are being organized for enforcement agencies such as police, customs, etc. to sensitize them about IP 
issues and also about the steps to be taken by them to fight counterfeiting and piracy.  
 The police are vigilant and prompt in taking suitable action, immediately upon receipt of the 
complaints from the right holders.  Search of pr emises, seizure of duplicat e, fake and counterfeit 
products, arrests of the offenders, with sufficien t publicity in the print and electronic media are 
regularly carried out successfully.  Most police de partments are now equipped with a separate cell 
with regard to cyber crimes which includes amongst other issues the sale and distribution of pirated 
goods. 
 
 Indian courts have held “the concept of IP R cannot be construed peda ntically.”  The legal 
position in India can be appreciated by the comment s of the Delhi High Court in a case of M/s Time 
Incorporated v/s Lokesh Srivisatava-2005 (3) PT C 3 (Del): “Whenever an action has criminal 
propensity also, the punitive damage s are clearly called for so that the tendency to violate the laws 
and infringe the rights of the others with a view to make money is curbed. The punitive damages are 
founded on the philosophy of corrective justice a nd as such in appropriate cases these must be 
awarded to give a signal to the wrong doers that  the law does not take a breach merely a matter 
between the rival parties but feels concerns about  those who are not parties but suffer on account of 
the breach”.  WT/TPR/M/182/Add.1 
 Page 143 
 
 
   The Government has also stepped up training to increase awareness of intellectual property 
rights enforcement. The Intellectual Property Training Institute (IPTI) provides training to government officials (including from the Intell ectual Property Offices and from other government 
agencies), employees in the private sector, including management levels creators of IPRs and academics, and to “potential users from the public at large”.  Special modules on IPRs have been 
included in the induction training programmes at the Customs and Police Academies. 
  An Inter-ministerial  Coordination Committe e on Intellectual Property Enforcement Issues 
has been set up with members drawn from variou s Government Departments concerned with IPR 
matters, namely the Department of Industrial Polic y and Promotion, the Department of Information 
Technology, the Department of Higher Education,  the Department of Agriculture and Cooperation, 
the Department of Commerce, the Department of Health and Family Welfare, the Ministry of 
Information and Broadcasting, the Ministry of Home Affairs, the Central Board of Excise and 
Customs and the National Crime Records Bureau . During the meetings of the Coordination 
Committee, broad issues in the context of cont inued emphasis on enforcement are discussed. The 
Committee holds its meeting once in a quarter. 
 
(vii) Competition policy 
WTO Secretariat's Report, page  95, para. 198 
 
67. Could an update be provided on the state of pl ay of the Competition Amendment Bill 2006?  
(Ministry of Company Affairs)  
Reply: A Bill for amendment to the Competition Ac t, 2002 - the Competition Amendment Bill-
2006/2007 having been deliberated by the Parliame ntary Committee, is being placed before the 
Parliament for further consideration. 
 
India's Report, page 13, para. 50 
 The EC notes a proposed amendment to the Essentia l Commodities Act to remove existing restrictions 
on trade of agricultural commod ities within the country.  
 
68. What are the current restrictions to the free movement of agricultural goods in India? What 
policies would the amendment propose to tackle them?  
 
Reply:   The need to relax various controls on agricu ltural products including control on inter-state 
movement of such products, was discussed in the conference of State Chief Ministers on WTO and 
Agriculture held on 21.05.2001 under the chairmanship of the then Hon’ble Prime Minister  wherein it 
was decided to form a Standing Committee of Minist ers incharge of five Central Ministries, Deputy 
Chairman of Planning Commission and Chief Ministers of eleven States to review  the list of essential commodities and control orders. Free movement of agriculture products was one of the terms of 
reference of the Standing Committee.   
 
 The said Standing Committee in its first meeting held on 6 July, 2001 decided that restrictions 
on movement of all agricultural commodities shoul d be removed and that the Essential Commodities 
Act, 1955 may continue as an umbrella legislation for the Centre and the State to use when needed but 
that a progressive dismantling of controls and restrictions was also required.   
In view of the uniform decision taken by the aforesaid Standing Committee and with the 
approval of Cabinet accorded in its meeting  held  on 05.02.2002,  licensing requirement, stock limits 
and movement restrictions etc. were dispensed w ith in respect of the specified foodstuffs namely 
wheat, paddy/rice, coarsegrains, sugar, edible oilseeds, edible oils, pulses, gur, wheat products WT/TPR/M/182/Add.1 
Page 144  
 
  (namely maida, rava, suzi, atta, resultant atta a nd bran) and hydrogenated ve getable oil or vanaspati 
vide central orders dated 15.02.200 2 and 16.06.2003.   With the issue of these orders, any dealer could 
freely buy, stock, sell, transport, distribute, dis pose, acquire, use or consume any quantity of these 
commodities.  
 In the context of recent rise in prices of certain essential commodities some State 
Governments requested for restoration of powers  for imposing stock limits etc. The Central 
Government taking into account the prevailing price situation, issued Central Order on 29 .8. 2006 by 
virtue of which the provisions of Central Or ders dated 15.2.2002 and 16.6.2003 so far as 
licensing/permission regarding purchase, movement, sale, supply, distribution or storage for sale are concerned, have been kept in abeyance with respect of wheat and pulses.These orders however 
explicitly provide that there shall not be any rest riction on inter-state m ovement of these two items. 
Further, imports of these two items have also been ke pt out of the purview of any controls by the State 
Governments. The Order is valid upto 31.8.2007.    Thus there are absolutely no restrictions on inter and intra States movement of agricultural 
products in India.  
  The Essential Commodities Acts 1955 has been  amended effective from 12.2.2007 whereby 
the list of essential commodities has b een further pruned down from 15 to 7. These are  (i) drugs; (ii) 
foodstuffs including edible oilseeds and oils; (iii) fer tilizer, whether inorganic, organic or mixed, (iv) 
petroleum and petroleum products; (v) hank yarn made  wholly from cotton;  (vi) raw jute and jute 
textile; and (vii) seeds of food-crops and seeds of fruits  and vegetables, seeds of cattle fodder, and jute 
seeds. These commodities have been co nsidered essential in the interest  of the farmers and the large 
section of the people below poverty line. The amendmen t also gives power to the Central Government 
to add, remove and modify any essential commodity in  the public interest.  However, it is expected 
that  addition  of any essential commodity will be done only in cases of extreme  scarcity or non-
availability   in  situations like war, natural calam ities, disruption or threat of disruption of supply of 
such essential commodities, which cannot be tackled through normal trade chan nels requiring Central 
government’s intervention under the said Act.  
69. Paragraph 19 describes tariff rate quotas I ndia has opened for agric ultural products and 
Table AIIL2 specifies the volume and in-quota/out-q uota tariff rates. Paragraph 19 also lays down: 
"Quotas are generally not issued because, according to the authorities, there is no demand from 
importers."   Could India specify what is the fill rate of those TRQs and how the TRQs are being administered? 
Could India explain the possible reasons why the TRQs are underfilled?   
 Reply:  The application and the procedure for issuan ce of authorisations under TRQ is notified under 
the Foreign Trade Policy and are available on the DGFT website www.dgft.gov.in. The quotas are 
allocated to the extent there is an expression of interest from desirous importers.  Permissions issued (fill rate) for import under TRQ are as under: 
 
In Metric Tonnes 
Item ITC(HS) 2002-03 2003-04 2004-05 2005-06 2006-07 
Milk Powder 0402.10 
0402.21 - 10,000 - - - 
Maize 1005.90 - 1,649 1,302 1,784 2,581 
Sunflower seed or Safflower Oil 1512.11 67,600 1,50,000 1,50,000 1,11,000 1,50,000 
Rape, Colza or Mustard Oil 1514.19 
1514.99 - - - - -  WT/TPR/M/182/Add.1 
 Page 145 
 
 
   
70. Could India provide some more details on how  exactly this support scheme is implemented? 
What is the amount paid for the promotion of ex port under this scheme? Are exports credits granted 
to agricultural exports or are exports subsidized by  an amount equivalent to 5% of the FOB value of 
exports? 
 
Reply:  Under the promotional measures as contained in chapter 3 of the Foreign Trade Policy, a 
special scheme for promotion of exports of Ag riculture Produce was launched with effect from 
1.4.2004. Rationalization of Foreign Trade Policy is  an annual exercise and in terms of the annual 
supplement issued with effect from 1.4.2007, the duty credit equivalent to 5% on FOB value is 
granted with an aim to compensate for high transp ort costs. The exporters of agriculture Produce, 
minor and forest produce, and their value added pr oducts as well as Gram Udyog Products as listed in 
Appendix-37A are eligible for the benefits. Appendix 37A is available in downloads at DGFT website 
(www.dgft.gov.in). A lower rate of benefits (@ 3. 5% of FOB value) is granted when agricultural 
inputs are imported for export purposes. The duty credit can be used for payment of duty upon import 
of freely importable items. 
 
WTO Secretariat's Report, page 119, para. 61 
 
The Indian authorities have declared the enhancement of the share of manufacturing in GDP as well 
as ambitions export targets for the coming two years ($160 billion and $200 billion for 2007/2008 
and 2008/2009 respectively) as two of its mo st important economic policy objectives.  
 71. What measures are the Indian authoriti es planning to take to achieve those goals? In 
particular, would any of type of s ubsidies be provided to Indian companies? If yes, are these subsidies 
provided contingent upon exportation?   
 
Reply: The Government has set up a high-level Na tional manufacturing Competitiveness Council 
(NMCC) with its Chairman enjoying the status of  a Cabinet Minister. The NMCC is mandated to 
recommend strategies and initiatives for the devel opment of the share of manufacturing in the 
country’s GDP. The NMCC has e volved national manufacturing strategies and initiatives. Many such 
initiatives are under implementation. Significantly, the manufacturing sector has registered a double 
digit growth from 6.6% in 2003-04 to 11.3% in 2006-07. 
 
WTO Secretariat's Report, page 126, para. 90 
 
72. Could the Indian authorities explain the po licy reasons behind recent proposals to place a 
49% FDI cap on courier services against the existing 100%?   
Reply:  The extant policy permits FDI up to 100% in Courier Services with prior Government 
approval and subject to the existing la ws and exclusion of letters reserv ed for distribution by the State. 
 
73. Could India inform about the legislation applicable to outsourcing services and the measures 
the government is taking to ensure non-di scrimination of foreign service suppliers?  
 
Reply: The extant policy permits FDI up to 1 00% on the automatic route in BPOs. 
 
Distribution sector 
 
74. Could India indicate how many people work in  the distribution sector and what has been the 
evolution in the last years?   WT/TPR/M/182/Add.1 
Page 146  
 
  Reply: Such information is not maintained. However, over 3 million people are estimated to be 
engaged in the distribution sector.  
75. Could India explain how much of the FDI attr acted by the country in the last years has been 
in the distribution sector? 
 
Reply:  
Inflow in Rs.Crores 
01/01/1991 to 31/03/2007 Name of the Activity  
GOVT  AUTO  
Wholesale Trade In Cereals & Pulses Othe r Than By Procurment Agencies 0.21 0.25 
Wholesale Trade in Electrical Machinery & Equipment   7.39 
Wholesale Trade In Eleectronic Equpiment & Accessories   22.46 
Wholesale Trade In Hardware & Sanitary Fixtures 0.05 0.46 
Wholesale Trade In Manufactur e/Processed Spices   37.20 
Wholesale Trade In Medicines & Chemicals   32.64 
Wholesale Trade In New readymade Garm ents(Except Hosiery Garments)   0.05 
Wholesale Trade in Other Goods N.E.C   9.79 
Wholesale Trade In Previous Metals, Stones & Jewellery   0.75 
Wholesale Trade In Raw Milk   0.01 
Wholesale Trade in Rubber,Plastic & Their Products   0.45 
Wholesale Trade In Scientific,Medica l,& Surgical Instruments 16.11 0.01 
Wholesale Trade In Straw & Fodder   0.25 
Wholesale Trade In Tea, Coffee & Cocoa   14.98 
Wholesale Trade In Textiles Articles   0.92 
Wholesale Trade In Watches,Eye-Glasses & Spectacle Frames   2.00 
Wholesale Trade In Fuel & Lighting Products 2.03   
Wholesale Trade In Ores 0.34   
Wholesale Trade In Other manufactured Foodstuffs N.E.C 1.93   
Wholesale trade in Sugar, Confctionary & Bakery Products 1.69   
Wholesale Trade In Textiles & Clothing Accessories Not Elsewhere 0.01   
Wholesale In trade In Toiletry, Prefumery & Cosmetics 19.91   
Wholesale Trade In Agricultural Raw Materials Live animals, Food 
Beverages 2.49   
 28.40 129.61 
 
76. Could India inform about the existing legislation applicable to retailing services?  
 
Reply:  India has not enacted any legislation for Distribution (retailing) services.  
 
77. Could India inform on how much of the FDI attracted by the country in the last years has 
been in the tourism sector? 
 
Reply:  The FDI in Hotel and Tourism sectors since 1991 aggregates to USD 512 million.  
 
78. Could India inform about existing plans to pr omote the tourism sector, and what measures 
the government is taking to ensure effective non-discrimination of foreign service suppliers?   
 Reply:  The tourism sector is looked upon as a major engine of economic growth and employment 
generation.  Recognizing the potential of tourism fo r generating vast employment opportunities and in 
furthering socio-economic objectives the Government of India has accorded a high priority to the  WT/TPR/M/182/Add.1 
 Page 147 
 
 
  development of the tourism sector in the country .  It has allocated increasingly larger amounts for 
strengthening the tourism infrastructure and hospita lity related services, and marketing of tourism 
products in the international market. To this effect , India’s competitiveness as a tourism destination is 
being improved by enhancing the experience of vis itors across all dimensions such as facilitation, 
service excellence and safety and security to the tourists. The Ministry of Tourism is laying increased 
stress on the promotion and marketing of India’ s tourism products.  Some of the activities being 
undertaken to meet this objective are:-  
a. Production of publicity material & CD ROMs/D VDs covering various tourist /pilgrimage 
sites, tourism products etc. within the country.  
b. Production of collateral such posters, exhibiti ons/point of sales publicity material etc. 
c. Promotion of India through interna tional and domestic media campaigns. 
d. Promotion of India through internet/online campaigns. 
e. Dissemination of information through incredible india.org website with several micro sites 
focusing on various themes/tourism products. 
f. Organizing of Events at National Level a nd participation in international events. 
 
The services in the Tourism sector under GAT S negotiations are sub-divided into the 
following categories: 
 
a. Hotel and restaurants including catering 
b. Travel agencies and tour operators 
c. Tourist Guide services 
d. Others 
 
 In the above sub-sectors, India is offeri ng full commitments under Mode-1, Mode-2 and 
Mode-3 except for Tourist Guide Services.  India has already made liberal offers in the tourism sector. 
The only area in which India has exercised restraint is under the tourists guide services since it curtails 
the employment opportunities being offered to the local guides. However, under Mode 3 & Mode 4 India has agreed for market access to tourist guid es services up to a total ceiling of 500 tourist guides 
conversant in Chinese, Spanish, Portuguese, Fren ch and Japanese in the case of foreign investors 
having prior collaboration in the specific service sector in India.  
79. Could India inform about plans for improving professional education and training related to 
the tourism sector? (Ministry of Tourism) 
 Reply:  Several Institutes imparting training in the tour ism sector have been opened by the Central 
Government, State Government and private sectors.  These institutes include the Hotel Management 
Institutes, the Food Craft Institutes and the Travel  Trade Institutes.  In addition the sub group on 
Human Resource Division and Capacity Building of  the Working Group on Tourism for the Eleventh 
Plan of the Ministry of Tourism in their report have recommended and outlined the main strategies for 
improving professional education and training as follows: - 
 
 - Making craft and hotel management education integral to the school system   - Creating institutions of excellence to stimulate interest  - Creating a pool of teachers 
 - Reworking of curriculum at diploma/degree stage 
 - Skill certification of service providers  - Building capacities  - Maintaining standards of education and training  - Overcoming manpower shortage  - Correcting the intra manpower imbalance 
 - Building image of the profession WT/TPR/M/182/Add.1 
Page 148  
 
   
80. What is India's assessment of the effect of th e tourism sector in overall economic growth and 
employment, and in particular in other economic  sectors like construction,  transport, computer 
services, education and professional training? (Ministry of Tourism)  
Reply:  Tourism has the potential to stimulate othe r economic sectors through its backward and 
forward linkages and cross-sectoral synergies w ith sectors like handicrafts, handloom, sports, 
horticulture, transport, etc. The consumption and demand, emanating from tourist expenditure, also 
induces more employment and generates a multiplier effect for the economy. As a result, additional 
income and employment opportunities ar e generated through such linkages. 
 
The travel and tourism sector is capable of providing employment to a wide spectrum of job 
seekers from the unskilled to the spec ialized, even in remote parts of  the country. One of the most 
important contributions of tourism is the creation of employment in rural areas by stimulating arts, 
handicrafts and folklore.  
 The contribution of tourism in GDP and employment in the country is estimated as under: 
 
Share of Tourism in GDP 
Year Direct Share Total (Direct Plus Indirect) 
2002-03# 2.78% 5.83% 
2003-04* 2.81% 5.90% 
2004-05* 2.91% 6.11% 
# Based on Tourism Sate llite Account (TSA) 2002-03 
* Estimated using TSA 2002-03 
Share of Tourism in Employment 
Year Direct Jobs 
(Million) % to total 
Employment Total Direct Plus Indirect 
Jobs 
(Million) % to total Employment 
2002-03# 21.54 4.59% 38.60 8.27% 
2003-04* 23.25 4.87% 41.85 8.78% 
# Based on Tourism Sate llite Account (TSA) 2002-03 
* Estimated using TSA 2002-03 
 
81. Could India inform about the existing legislation applicable to tour managers (professionals 
accompanying groups of tourists in their travel through the country) and tourist guides? (Ministry of 
Tourism) 
 
Reply: There is no legislation in respect of Tour Ma nagers in the country. Tour Managers usually 
work with tour operators and travel agents and the Ministry of Tourism has a voluntary scheme under 
which it grants recognition to tour operators/travel agents.   
 The Ministry of Tourism acts as a regulatory authority for the induction of tourist guides.  The 
Ministry of Tourism grants guide licenses to the tourist guides on a regional basis. The profession of 
tourist guides in the country is covered under th e Ancient Monuments and Archaeological sites and 
Remains Act. The Additional Director General (Tour ism) is the statutory authority for the issue of 
tourist guide licenses. 
  WT/TPR/M/182/Add.1 
 Page 149 
 
 
   India has agreed for market access to tourist guide services up to a total ceiling of 500 tourist 
guides conversant in Chinese, Spanish, Portuguese,  French and Japanese languages in the case of 
foreign investors having prior collaboration in the specific service sector in India. 
 
82. Could India explain the plans that the govern ment is considering to reduce or eliminate 
discrimination of foreign service suppliers in  these fields? (Ministry of Tourism) 
 
Reply: The services in the Tourism sector under GATS negotiations are sub-divided into the 
following categories:  
a. Hotel and restaurants including catering 
b. Travel agencies and tour operators 
c. Tourist Guide services 
d. Others 
 
 In the above sub-sectors India is offering full commitments under Mode-1, Mode-2 and 
Mode-3 except for Tourist Guide Services.  India has al ready made liberal offers in the tourism sector.  
The only area in which India has exercised restraint is under the tourists guide services since it curtails 
the employment opportunities being offered to the local guides. However, under Mode 3  & Mode 4 
India has agreed for market access to tourist guides services up to a total ceiling of 500 tourists guides 
conversant in Chinese, Spanish, Portuguese, Fren ch and Japanese languages in the case of foreign 
investors having prior collaboration in the specific service sector in India. 
 
83. In spite of the guidelines issued by the Reser ve Bank of India, the exact position the RBI will 
be taking regarding entry of foreign banks from 1April 2009 is not clear.   
Is there a possibility of further postponement in allowing greater market access to foreign banks in 
India following a review by the Reserve Bank of India during 2009?  
 
Reply:  The roadmap for the presence of foreign banks in India announced on February 28, 2005, 
envisaged a two-track approach with one track em phasizing the consolidation of the domestic banking 
system in both public and private sectors while th e second track propounding a gradual enhancement 
of the presence of foreign banks in a synchronised manner, consistent with India’s commitments to 
the WTO. In the first phase (April 2005- April 2009), foreign banks operating in  India will be allowed 
to convert their existing branches to WOS while following the one mode presence criterion. The WOS 
will be treated on par with the existing branches of foreign banks for branch expansion in India.  RBI 
may prescribe market access and national treatment limitations consistent with WTO, as also other 
appropriate limitations to the operations of WOS consistent with interna tional practices and the 
country's requirements.    In the second stage, starting from April 2009, removal of limitations on WOS and treating 
them at par with domestic banks to the extent a ppropriate, will be implemen ted after reviewing the 
experience during Phase I  in consultation with  all stakeholders in the banking sector. 
 
84. Could India please confirm that the bill am ending the banking act will abolish the 10% cap 
on voting rights, as indicated by the Secretariat rep ort? Regarding the same bill, could India also 
explain whether the prior approval requirement for 5% or more of shares or voting rights in a bank is 
exclusively a prudential measure?  
 
Reply:  
 The Bill proposing amendment to the Banking   Regulation Act, 1949 proposes to abolish 
10 % cap on voting rights.  WT/TPR/M/182/Add.1 
Page 150  
 
   The provision for RBI’s prior approval for acquisition  of  5 % or more of shares or 
voting rights  in a banking company by a ny person and empowering RBI to impose such 
conditions as it deems fit in this regard is a prudential measure to ensure  that the 
acquisition of shares is by a person considered  fit and  proper and that the applicant 
continues to be fit and proper to hold the shares or voting rights above the specified 
limits. 
 
85. The WTO Secretariat's Report states that, so fa r, no foreign bank has set up a wholly-owned 
subsidiary in India.   
When did India issue implementing rules for the setting-up of wholly-owned subsidiaries? 
 
Reply:  The roadmap for presence of foreign banks in India announced on February 28, 2005, 
envisaged a two-track approach with one track emphasizing the  consolidation of the domestic banking system and the second track propounding a gradual enhancement of the presence of foreign 
banks in a synchronised manner, cons istent with India’s commitments to the WTO. In the first phase 
(April 2005- April 2009), foreign ba nks operating in India will be a llowed to convert their existing 
branches to WOS while following the one mode pr esence criterion. During th is phase, foreign banks 
already operating in India will be allowed to conve rt their existing branches to WOS while following 
the one-mode presence criterion and the guidelines on  conversion of existing branches into WOS 
were given at that time. 
 
WTO Secretariat's Report, page 131, para.105 
 Despite strong indication from certain members of the government to raise the FDI cap on insurance 
from 26% to 49%, the proposed bill on this issue is being delayed.  
 
Reply:  It has been proposed to amend the Insura nce Act, 1938 which would inter alia, include 
amendments relating to enhancement of FDI in Indian Insurance companies from 26% to 49%.  A 
draft bill is under consider ation of the government. 
 
86. What would be the timeframe to give effect  to this legislation bringing about higher 
participation of foreign players in India’s insurance sector?    
Reply: Allowing enhancement in FDI limit in the insu rance sector requires amendments to some 
sections of the Insurance Act, 1938.  This is a legi slative process and ultimately the decision of the 
Parliament will prevail. No fixed timeframe can therefore be prescribed. 
 
87. Has India abolished the contro ls on insurance tariff rates, something that according to the 
Secretariat report was foreseen for January 2007?  
 
Reply:  Tariff rates for various classes of the in surance business have been discontinued w.e.f. 
1.1.2007.  (iv) Telecommunications  WTO Secretariat's Report, page 131, para.115-116 
 
88. Which are the procedures for allocating frequenc ies for the provision of satellite services and 
especially in the Ku-band?  
 
Reply:   A telecom licensee can approach ANTRIX Corpor ation Limited or the  Department of Space 
(DoS) for allocation of space segment.   WT/TPR/M/182/Add.1 
 Page 151 
 
 
  89. Are foreign satellites operators free to contract directly with telecommunications operators? 
Is the provision of VSAT services liberalised?  
 
Reply:   Foreign satellite operators have to  apply to the Department of Space. 
 90. Is it correct that the recommendations issued by  TRAI related to the provision of satellite 
services need the prior approval of both the Depar tment of Telecom and the Department of Space?  
 
Reply:  The approval of the Department of Telecommuni cations is required afte r a consultation with 
the Department of Space. 
 
91. Would India consider that having ISRO operati ng the domestic satellite system and being part 
of the DOS while the DOS participating in the ap proval of the recommendations by TRAI that all 
necessary guarantees are provided for the effectiv e separation between regulatory and operational 
functions?  
 
Reply:  There is an effective separation of the regulatory and operational functions. 
 
92. Does India provide for free market entry for the provision of mobile satellite services?  
 
Reply:   No. 
 
93. Could India provide an update on the requirements  for the installation of a satellite gateway 
in the country?  
 
Reply:  The satellite gateway is required to be installed by the Global Mobile Personal 
Communication by Satellite (GMPCS) operator in I ndia.  The International Long Distance (ILD) 
service provider can also install a satellite gateway in the country. The  telecom licensee  must  
however fulfill  the regulatory  as  well as national  security  conditions for the installation of the 
satellite gateway.  
94. Policy guidelines favouring the award of dre dging contracts in Major Ports to the Public 
Sector, Dredging Corporation of Indi a, restrict combination in this rapidly growing area.  What steps 
can be expected in future to revoke such preferential treatment.  
Reply:  The present Dredging Policy for Major Ports whic h is applicable for a period of three years 
w.e.f. 1.4.2007 inter-alia provides for the first right  of refusal to Indian Companies whose offer is 
within 10% of the lowest technically valid offer against the global tender floated for award of the 
dredging contract.  This is applicable in respect of  all Major Ports except Kolkata Port Trust.    The 
present policy aims at making available adequate capacity and expertise in the Indian dredging 
market.  
95. Could India indicate as to whether it in tends to abolish its remaining cargo sharing 
arrangements? 
Reply:  India is examining the issue of abolishing th e cargo sharing arrangements with its bilateral 
partners or in terms of the UN Code on Liner Conference. However, cargo sharing clauses area  part of bilateral agreements with that Member and any steps in abolishing / modifying any clause of that 
agreement would have to comply with the releva nt procedures/ conditions stipulated in these 
agreements. 
 
96. Could India indicate  whether it intends to review its cargo reservation arrangements which 
reserve 40% of cargo carriage to Indian flag vessels? WT/TPR/M/182/Add.1 
Page 152  
 
  Reply:  The 40% cargo reservation for Indian flag vessels is covered under the UN Code on Liner 
Conference to which India is a party. India would examine the cargo reservation arrangements. 
 
97. Could India indicate whether it intends to review the granting of the right of first refusal to 
Indian flagged vessels concerning the carriage of cargo? 
Reply:  As per India’s schedule of specific commitments in its Draft Offer on Maritime Transport 
Services under GATS the limitations on Market Access cl early specify India’s position in this regard. 
As per the existing government policy, in respect of government owned/controlled cargoes, all import 
contracts are to be finalized on FOB/FAS basis. Deviation from this requires prior permission from 
Transchart on a case to case basis. The present policy of import of cargoes is mainly to provide cargo 
support to Indian flag vessels by providing them the first right of refusal without giving any price 
preference. The policy is  considered essential in or der to ensure the arrival of strategically required 
cargoes/materials on time and in case of emergency situations. However, no preference/restriction is imposed on export of cargoes including government cargoes. At present, India does not intend to review the policy. 
 
98. Could India indicate which cargoes are consid ered Government cargoes? 
Reply:  Government cargoes are the cargoes owned or controlled by the Government (including the 
state governments) or its organizations.  
WTO Secretariat's Report, page 142, Para 151. 
 
Persistent public debate and strong indications from  the Civil Aviation Minister suggest that the FDI 
cap in specific segments of air transport like air cargo carriers, helicopter and non-scheduled 
operations will be raised from the existing 49%.  
99. When is this expected to happen?  
 
Reply: A proposal regarding revision of FDI cap in segme nts of air transport like air cargo carriers, 
helicopter and non scheduled opera tions is being considered for inclusion in the FDI Policy. 
 
100. Could India provide full details of its legi slative initiative concerning the ground handling 
market at airports?   
Reply: The Government have approved a new Ground Ha ndling Policy.  As per this policy, the 
following entities are eligible to undertake ground handling at –  
(A) All metropolitan airports i.e Delhi, Mumbai, Chennai, Kolkata, Banga lore and Hyderabad – 
 
i) The respective airport operators itself or its joint venture. 
ii) Subsidiary companies of National Carriers i.e. Air India / Indian Airlines or their joint 
ventures specialized in ground handling services. Third party handling will also be permitted to these subsidiaries. 
iii) Any other ground handling service provider selected through competitive bidding by 
the airport operator. 
 (B) At all other airports, in addition to the entities mentioned above, self-handling will also be 
permitted to the airlines excluding foreign airlines. 
  WT/TPR/M/182/Add.1 
 Page 153 
 
 
  (C) Airlines or entities presently involved in ground handling, which are not covered under the 
policy, enunciated in (A) and / or (B) above will no t be permitted to undertake self-handling or third 
party handling with effect from 1.1.2009.   Three types of handling arrangements are indi cated as permissible. Self-handling is not 
mentioned as an option. 
 
101. Could India explain whether the objective of the le gislation is to deny air carriers the right to 
self-handle their ground handling arrangements?   
102. Could India clarify whether there is a limit on the number of ground handlers that can be 
selected on the basis of competitive bidding? If so, please explain the reasoning for such a limit, if other than due to space constraints on the airport premises.  Indications from the press this year suggest that the government is developing guidelines on the 
management of airports by private companies.  
 103. Could India confirm this initiati ve and, if so, provide details?  
 
Reply to Q. 101, 102, 103 – The policy has been laid down keeping in view infrastructure constraints 
and aviation security, operational and safety aspects.  In ternational practices have also been studied. It 
is observed that: 
 
a. If individual airlines are permitted to undert ake self-handling, a lot of space may be 
required for their equipment and offices. Over crowding on the operational side can have 
serious safety implications besides adversely affecting the aesthetics of the airport. 
b. A large number of personnel e ngaged by individual airlines would have to be provided 
access to operational areas, raising security concerns. 
c. The metropolitan airports are being taken up for restructuring and upgradation to world-
class standards.  Such a process in Delhi and Mumbai airports has already begun. India feels that such standards may not be achieve d by adopting varying standards by individual 
airlines.  This can also impinge upon the ob ligation of the JV companies to achieve 
mandated performance standards. 
d. It is understood that large world class airpor ts like Singapore, Dubai, Athens and Kuala 
Lumpur do not permit self-handling by ai rlines and third party ground handlers are 
permitted to provide these services to any air lines. National carriers of these countries are, 
however, permitted to do self-handling. 
 
 The ground handling policy for metropolitan airpor ts, inter-alia, not allowing private airlines 
in these areas has been finalized in  the above background. Since smalle r airport i.e. non-metro airports 
are served by a limited number of airlines with only a few flights, and the infrastructural and other such constraints are less at these airports, private dom estic airlines will continue to enjoy the facility 
of self-handling at smaller airports. 
 
(vi) Professional Services 
 
WTO Secretariat's Report, page 147, para 170 
 
The Advocates Act of 1961 provides in its Article  47 (2) titled "reciprocity" that the Bar Council of 
India can prescribe the conditions subject to whic h foreign qualifications in law obtained by persons 
other than citizens of India shall be recognised for the purpose of admission as an advocate under the Advocates Act.  WT/TPR/M/182/Add.1 
Page 154  
 
  104. Could India explain what conditions the Bar Council of India has developed to allow for 
recognition of foreign qualifications as described in Ar ticle 47 of the Advocates Act? Furthermore, 
are the conditions prescribed by the Bar Council, if any, publicly available?  
 
Reply:  The Bar Council of India has so far not rec ognised any foreign qualification in relation to 
Section 47 of the Advocates Act, 1961. The Bar Council of India has recognised a number of foreign 
qualifications under Section 24 (1 (c) (iv) of th e Advocates Act, 1961. Section 47 of the Advocates 
Act deals with reciprocity and recognition of the fo reign qualification for the purposes of enrolment of 
foreign nationals whereas Section 24 (1) (c) (iv) de als with recognition of foreign qualifications for 
the purpose of enrolment of Indian nationals as Advocates. The Bar Council of India considers 
recognition of foreign law degrees for the purpose of enrolment of Indian Nationals provided the law 
degree is of three years duration and if the candidate joined the said law degree course after graduation. The Bar Council of India recognises the degrees of foreign Universities on the basis of 
merit and suitability of each degree. The list of rec ognised foreign qualifications is available with the 
Bar Council of India.      105. Could India explain how many foreign qualifications  of persons that are not citizens of India 
have been recognised under the Advocates Act?  
 
Reply: The Bar Council of India has not so far recognised any foreign qualification for the purpose of 
enrolment of foreign nationals. 
 
WTO Secretariat's Report, page 147, para 171 
 Massive overseas operations by Indian companies, numerous leading global firms doing business in 
India and the huge potential of outsourcing legal ser vices to India, demand efficient world class legal 
services and compliance to international legal practices.  
 106. In this context, what are India's plans for opening up the legal services sector?   
 
Reply:   The issue is under examination in cons ultation with the concerned stakeholders. 
 
REPLIES TO ADDITIONAL QUESTIONS FROM THE EUROPEAN COMMUNITIES
 
 II.
  TRADE  POLICY  REGIME:  FRAMEWORK  AND  OBJECTIVES 
 (2) T
RADE POLICY OBJECTIVES  
 
WTO Secretariat's Report, page 22-23, para. 13, 15  India's Foreign Trade Policy acknowledges the im portance of facilitating imports and calls for a 
simplification of import procedures and a reduction of import barriers, as well as coherence and 
coexistence between trade and other economic policies. 
 
3. Could India indicate whether specific meas ures in this regard have already been 
identified? 
4. If yes, could India list the planned measu res and provide a timetable for these reforms? 
 
Reply:  India has been  simplifying import procedures on a continuous basis in order to reduce 
transaction costs and facilitate transparency in  doing business. The Government has recently 
introduced a computerized Risk Based Management  System (RMS) for imports at major Customs 
ports in India. Most of the imports, which meet th e parameters of RMS, require simple documentation 
for clearance from Customs thereby saving on time and costs.    WT/TPR/M/182/Add.1 
 Page 155 
 
 
  (a) Banking 
 WTO Secretariat's Report, page 127ff, para. 93ff  It is a requirement of the Reserve Bank of India t hat bank guarantees must be issued and/or confirmed 
through the Indian banks even when these guarant ees originate from first class foreign banks. 
 
5. Does India intend to re-evaluate this requirement?  
 
Reply:  This does not appear to have been raised in the Report. In any case the Reserve Bank of India  
has not issued such guidelines.  
 
WTO Secretariat's Report, page 13, para. 28  
1. Could India provide information on its pl ans and timetable for renewing its capital 
markets?  
2. Could India elaborate on whether measures have already been identified and are planned 
as part of this reform?  
 
Reply:  Capital Market reforms is an ongoing process, and is tied to developments / innovations in the 
financial markets.  Some of the measures which are planned for the future include : 
 
• Strengthening corporate debt markets, 
• Securities lending and borrowing, 
• Introduction of interest rate derivative products, 
• Introduction of short selling fo r institutional investors. 
 
REPLIES TO FOLLOW-UP QUESTIONS FR OM THE EUROPEAN COMMUNITIES ON 
THE SECOND DAY  
 
Economic and trading environment; investment 
 
We heard on Wednesday that despite the impressi ve growth of India's investment in- and outflows 
over the past years, there still is potential for furt her growth if only the still persisting barriers are 
eliminated. In the context of the current annual FD I policy review, we would encourage India to take 
a proactive approach to increasing the FDI ceilings in key services sectors . This would seem 
indispensable to meet the very ambitious target of USD 30 billion for 2007/08. As for India's plan to 
upgrade its infrastructure, usi ng public and private partnerships and engaging FDI, the investment 
climate becomes a decisive factor again.  
Reply:  The FDI policy is decided by the Government.  FDI policy is reviewed on a continuous and 
ongoing basis with the objective of rationalizing the already liberal FDI policy regime. The review of 
policy also addresses procedural simplification and the investment requirements of various sectors. The review is aimed at making the policy regime in creasingly investor-friendly. The target of US$ 30 
billion is expected to be achiev ed through the above measures. 
 
Trade policy objectives and measures 
 
I was interested to see India's replies on its re gional trade agreements and the notification process to 
the WTO  [8-12]. What seems to be missing from India' s replies is an analysis of the volume and value 
of trade covered by such agreements, particularly for SAFTA and the CECA with Singapore. Perhaps 
India could give consideration to supplying this in formation. Establishing such analysis would seem WT/TPR/M/182/Add.1 
Page 156  
 
  to be important, particularly given the multitude  of bilateral negotiations India is currently 
undertaking with many of the partners in this room.  
Reply:  Separate data on trade under PTAs is not mainta ined. Data on overall trade with the countries 
in the region is being furnished. 
 
India’s trade with SAARC countries@ 
(In US$ million) 
2004-2005 2005-2006 2005-2006 
(Apr-Dec) 2006-2007 
(Apr-Dec) Country 
Export Import Export Import Export Import Export Import 
Afghanistan@ 165.44 47.01 136.75 58.58 99.34 42.60 127.51 31.26 
Bangladesh 1631.12 59.37 1632.44 1187.42 1015.04 88.00 1189.69 184.48 
Bhutan* 84.58 71.00 99.14 88.85 75.19 64.56 40.07 92.04 
Maldives 47.61 0.61 67.20 1.98 52.03 1.43 49.23 2.25 
Nepal** 743.14 345.83 859.40 379.96 635.07 290.98 702.09 229.46 
Pakistan 521.05 94.97 681.85 177.48 437.48 141.63 980.33 247.48 
Sri Lanka* 1413.18 378.40 2018.48 571.69 1529.79 424.81 1584.62 353.35 
Total 4606.12 997.19 5495.26 1397.3 3843.94 1054.01 4673.54 1140.32 
% Share 5.51 0.89 5.34 0.98 5.25 1.00 5.12 0.84 
India Total 
Export 83,535.94 102,725.10 73110.96 91213.32 
India Total 
Import 111,517.44 142,416.28   105349.41 134499.59 
India’s total 
world trade 195053.38 245141.38 178460.37 225712.91 
Data Source:  DGCI & S Kolkata (Supplied by NIC, DOC) 
* With these countries India has free trade agreements 
**  Under the India-Nepal bilateral Treaty of Trade, there is fr ee trade between the two countries on mutually agreed primary g oods 
and India  allows duty-free access to Nepale se manufactured goods on non-reciprocal basis. 
@ All the above South Asian countries are members of  SAARC  (Afghanistan became a member of SAARC on 3-4 April 2007, 
during the 14th SAARC summit in New Delhi and it will become a signa tory to the Agreement on the South Asian Free Trade 
Area Agreement (SAFTA)  which has become operational from 1 Ju ly 2007.  The other countries including India are signatories 
to SAFTA.  WT/TPR/M/182/Add.1 
 Page 157 
 
 
  India’s bilateral trade with Singapore 
(Value in US$ Million)  
Year  Exports % Growth Imports % Growth Total % Growth Trade 
Balance 
2000-01 861.00 28.70 1433.34 -6.59 2294.34 4.13 -572.34 
2001-02 972.31 12.93 1304.09 -9.02 2276.40 -0.78 -331.78 
2002-03 1421.58 46.21 1434.81 10.02 2856.39 25.48 -13.23 
2003-04 2124.84 49.47 2085.38 45.34 4210.22 47.40 39.46 
2004-05 3795.51 78.63 2582.16 23.82 6377.67 51.48 1213.35 
2005-06 (Apr – Nov) 3631.95  2041.63  5673.58  1590.32 
2006-07 
(Apr – Nov) 4176.23 14.99 3722.77 82.34 7899.00 39.22 453.46 
 
On Wednesday, I noted the complexity of India's tariff system  and remain concerned about the 
predictability and transparency for traders. I underst and from India's answer to our question [15] 
that changes may be made during the financial yea r. This can create considerable uncertainty for 
importers. In addition, I would encourage India to consider establishing a single internet information 
point which would actually calculate the overall dut y burden by State to further facilitate trade [18]. 
Surely this would not be an arduous task for a country whose IT experts are world class.  
Reply: Indian Customs are continuing with their endeavour to enhance transparency and 
predictability in the customs administration.  
 
We are also seeking some follow-up info rmation on a question related to SPS
 [41]. We note that India 
has carried out a detailed risk analysis for avian influenza  and would be grateful if this could be 
made available. Can India indicate which elements of this assessment lead it to  conclude that imports 
of livestock and livestock products from the EC present an unacceptable risk despite having satisfied 
the requirements of the OIE Animal Health Code?  
Reply: The basis of the question is not clear.  India’s reply to question 41 does not imply that there is 
a blanket ban on the import of livestock products  from any specific group of countries.  India’s 
measures relating to import restrictions in response to an outbreak of Avian influenza are primarily 
applicable to countries positive for Avian influenza.  As clarified earlier, India’s measures related to 
Avian influenza have been undertaken in consultation with technical experts, who in turn have taken 
into consideration and reviewed thoroughly the ava ilable scientific literature on Avian influenza, OIE 
provisions, FAO, WHO reports and other such inform ation related to recurrence and spread of Avian 
influenza in countries the world over.  Further, for recognizing a country free of Avian influenza, 
India takes into consideration all the relevant  guidelines laid down in Article 2.7.12.3 of OIE 
Terrestrial Animal Health Code 2006 including steps/measures undertaken on the ground by the 
country to declare freedom from Avian influenza.  
We are grateful for India's answers to our procurement
-related questions and would like to clarify 
first, that foreign suppliers are eligible to te nder in open tenders under the same conditions as 
domestic companies [45].   
Reply:  Yes 
 Secondly, is the DGS&D in a position to prov ide a number or estimate of how many foreign 
companies and Indian agents of foreign companies it has registered [51]?  WT/TPR/M/182/Add.1 
Page 158  
 
  Reply: 124 foreign manufacturers or their Indian agents or stockists of foreign goods are registered 
with DGS&D. Besides, Indian subsidiaries of Fo reign Manufacturers; such as, HP India, CANON 
India, XEROX India, RICOH India, SHARP Indi a, IBM India, EPSON India, MOTOROLA India, 
ACER India, SONY India, and LENOVO India ar e on DGS&D rate contract for computers & its 
peripherals and various office equipments. 
 
Sectors 
 I noted the comments about India's imports exceeding India's exports. The majority of imports are, 
however, not imported for domestic c onsumption but, rather, are used as intermediary inputs by the 
domestic industrial and services production. Therefo re, liberalising imports is also key for India's 
manufacturing sector
. India should avoid taxing exports through imports. 
 
Reply: India over the years has, in a graduated manner, reduced its import tariffs. Imports, meant for 
export production, are exempt from import tariffs by vi rtue of a number of export promotion schemes 
like EPCG, Advance Authorization Scheme etc. 
 
I will not repeat my comment about encouraging g reater openness to FDI, but would raise specific 
concern about the impact on investment of restric ting certain FDI caps, such as the proposal under 
discussion to limit FDI in courier services  from 100% to 49% [72]. I need hardly point out the 
negative effect on this sector, as well as India's reputation worldwide, of any such forced 
disinvestment and would recommend prudence and coh erence in the overall direction of FDI policy. 
 
Reply: The Government of India has followed a calibrated progressive liberalization of the FDI 
policy since 1991.  FDI up to 100% in courier ser vices was permitted in 2001 subject to the existing 
laws and exclusion of letters reserved for distribution by the State. As of now there is no proposal to 
revise the FDI policy in respect of the courier ser vices.  The Government has proposed an amendment 
to the existing Postal legislation to address various issues arising out  of developments  in the postal 
sector including inter-alia, the private sector participa tion in distribution of letters.  The legislation has 
not been enacted so far.    
MEXICO
 
 
4. Paragraph 116 states that fixed-line telephone services remain dominated by the public 
sector providers.  Does the Indian Government pl an to allow increased participation by private 
and/or foreign providers for this type of service? 
Reply:  All the services including fixed-line are open to free competition. 
5. Paragraph 122 notes that the Telecom Regulato ry Authority of India (TRAI) regulates tariffs 
for its services where markets are not  competitive.  On the basis of what criteria does the TRAI 
determine whether a market is competitive or not? 
Reply:  The TRAI bases its decisions on the general principles of competition.  
6. According to paragraph 130, the Government pl ans to replace the Carriers Act 1865 with the 
Carriage by Road Bill 2005.  When will this change  formally take place, and what advantages will it 
have for the road transport sector? 
Reply: Presently the law relating to the rights and liability of the common carrier is contained in The 
Carriers Act, 1865.  Most of the provisions of this Act have become obsolete in view of the changes 
that have taken place over the years in the transpor tation trade by road.  A class of intermediaries like 
booking agents, brokers etc. has emerged, who play a vital role in the field of transportation of goods  WT/TPR/M/182/Add.1 
 Page 159 
 
 
  by road.  In order to repeal the Carriers Act,  1865 and also to meet the needs of modern day 
requirement of trade and transportation by road, Government had introduced the Carriage by Road 
Bill 2005 in Rajya Sabha on 7.12.2005. The Bill is still under disc ussion. No definite time frame for 
the passage of the bill can be envisaged at this stage.  
The following broad proposals are inter alia part of the bill:   
• The system and procedure involved in the trans portation of goods by road to be simplified 
and modernised. 
• Mandatory registration of the common carrier which include the persons engaged in the 
business of collecting, storing, forwarding or distributing goods to be carried by goods 
carriers for transportation by motorised trans port by road and the intermediaries involved 
in the business to be regulated. 
• Single registration for a common carrier for carrying out its business across the country. 
• Making it mandatory on the part of the consignor  to declare the nature and value of the 
goods, including the goods of h azardous and dangerous nature. 
• The common carrier to be liable for damage to or loss of goods undertaken for 
transportation by him due to his act of negligence. 
• The common carrier to ensure that the goods of dangerous and hazardous nature are 
insured before undertaking their transportation.  
7. Is foreign capital allowed to participate in the road transport of freight and passengers, and 
if so, what is the maximum amount allowed? 
Reply: Detailed information about the FDI regime governing different sectors, including road 
transport of freight and passengers  is provided on the website of De partment of Industrial Promotion 
and Policy. 
8. Are improvements planned in the telecommunica tions, construction, co mputing and transport 
sectors? 
Reply: Road Transport is primarily a State subject.  It is for the States to take measures for promoting 
road transport services for both goods and passenger.   The provisions of the Motor Vehicles Act, 1988 
and Rules made there under, facilitate improvements in the road transport sector and do not envisage 
any hindrance for further improvement in the sector vis-à-vis new technological developments. 
 
3. According to paragraph 106, competition in the insurance industry is being constrained by 
the relatively high entry barriers.  What are these barriers and what is their regulatory framework?  
Does the Government have any plans to allow insurers greater participa tion in the market?  
 
Reply:  The reforms in the insurance sector started with the enactment of the Insurance Regulatory 
and Development Authority Act 1999.  The Act pa ved the way for the entry of private insurance 
companies into the insurance market and also  constitution of the  Insurance Regulatory and 
Development Authority. Advent of new companie s has increased the awareness of insurance among 
the general public, increase in the choice of products for the consumers and better customer facilities.   
 
IRDA was constituted on 19.4.2000 to protect the interest of the holders of insurance policies 
and to regulate, promote and ensure orderly growth  of the insurance industry.   For regulating and 
developing the insurance sector, the Authority issu es regulations and other circulars to insurance 
companies.  The  regulations covers the entire segment of insurance industry, namely, regulation on insurance agents, solvency margin , investment, re-insurance, regist ration of insurers, obligation of WT/TPR/M/182/Add.1 
Page 160  
 
  insurers to rural and social sector, accounting pro cedure, third party administrators, protection of 
interests of policyholders etc.     
With a view to ensure smooth functioning of the progressively liberalizing insurance sector, 
the Government has enacted the Insurance (Amendment) Act in 2002. The Act enabled introduction 
of brokers as intermediaries, allowing more flexib ility in the eligibility qualifications for corporate 
agents, allowing a more flexible mode of paymen t of premium through credit cards, smart cards, over 
internet etc, change in the allocation of surplus between shareholders and policy holders, direct entry 
of co-operatives in the insurance sector etc.   
At present, foreign equity upto 26% is allowed in the insurance sector.  FDI upto this limit has 
been put on the automatic route.  A draft Bill for inter alia raising the FDI equity cap from 26% to 
49% by amending the Insurance Act, 1938 is curre ntly under consideration. As on 31.3.2006, the 
share of FDI in insurance companies, both life an d non-life, was Rs.16886.7 million.  The details of 
FDI, as on 31.3.2006, are given in the following table:  
 
Rs. in tens of million FDI Total equity 
Life Insurers 1355.35 4535.60 
Non-life Insurers 333.32 1550.69 
Grand Total 1688.67 6086.29 
 
Prior to opening of the sector, there were five public sector companies on the general 
insurance side (including ECGC) and the LIC on the life insurance side. GIC was the holding 
company of the four general insurance compan ies as well as the Re-insurer. (5+1+1= 7).  At present a 
total of sixteen insurance companies are operating on the general insurance side (including AICL, 
ECGC,  GIC and A standalone Health insurance Comp any i.e. Star Health) and an equal number of 
companies are operating on the life side.   
 
The Tariff Advisory Committee (TAC) constituted under Section 64U of the Insurance Act, 1938 
controlled and regulated the premium rates of the following categories of general insurance business 
upto 31.12.2006:  
(i) Fire insurance 
(ii) Motor insurance 
(iii) Engineering insurance  
 
 In respect of the other categories of business, insurance companies, both public and private, 
were free to decide their premium rates.  With effect from 1.1.2007 the IRDA has de-tariffed  all 
categories of the general insurance business.    IV. TRADE POLICIES BY SECTOR, (5) Services, (iii) Financial Services 
 Paragraph 92 mentions that restrictions on fo reign banks have been relaxed.  Mexico would 
appreciate a more detailed explanation of the type  of measures taken to enable foreign banks to 
improve their participation.  
Reply: Commitment of India to WTO is 12 licenses per year for both new and existing foreign banks. 
Under the commitment, licences for new foreign banks may be denied when the maximum share of assets in India both on and off balance sheet of fore ign banks to total assets both on and off balance 
sheet of the banking system exceeds 15%.   WT/TPR/M/182/Add.1 
 Page 161 
 
 
  The share of foreign banks in the total assets of the banking system, both on balance sheet and 
off balance-sheet (Notional Principal basis),  was 49 per cent at the end of January 2007.  
India has been granting licenses autonomously in excess of its commitment of 12 branches. 
The year wise number of approvals granted since 2000 is as below: 
Year      No. of licences  
2000 --- 15 
2001 --- 18 2002 --- 16 2003 --- 18 2004 --- 17 
2005 --- 13 
2006 --- 13 
  While considering applications for opening of new branches, weight is given to the banking 
facilities provided by the bank in under banked areas.   
 
According to paragraph 94, the banking sector is dom inated by public sector banks, which account 
for 72 per cent of the sector's total assets.  Do es the Government have any plans or strategies to 
promote greater participation of private domestic  and/or foreign capital in the banking system?  
Reply: The share of public sector banks in aggregate deposits have been fallin g consistently over the 
years. In 1999, Public Sector ba nks had 82.6 per cent share of depos its which had fallen to 75 per cent 
in 2006. Share of Public  Sector banks in the total assets of scheduled commercial banks have fallen 
from 75.3 per cent in 2005 to 72.3 per cent in 2006.  
The share of foreign banks in off-balance sheet assets (on Noti onal Principal basis) of the 
banking system was 67 per cent as at the end of January 2007. 
As a major step towards enhancing competition in the banking sector, foreign investment is 
now allowed upto 74 per cent from all sources in private sector banks under the automatic route, 
subject to conformity with the guidelines issued from time to time. 
CHINESE TAIPEI
 
 
Question 1:  
(Page 13, paragraph 29) 
 
As indicated, among the major problems facing I ndia today are unemployment, underemployment and 
job creation. More general reform is probably needed as the labour market appears to be relatively 
inflexible. 
 It is widely recognized that India has put more emph asis on the liberalization of Mode 4 in the Doha 
Round services negotiations. We are interested in ho w India’s labour and manpower policies relate to 
its stance on Mode 4 liberalization. 
a) Does India regard the liberalization of Mode 4 as a useful policy instrument to make its 
labour market more flexible? If so, what is the rationale fo r such a policy?  
 
b) Given the deficit in domestic professional manpower (Indian Government Report, page 14, 
paragraph 57), could the increased mobility of skilled workers from abroad also have a negative 
effect on India’s employment policy? If so, how would India tackle this problem?  WT/TPR/M/182/Add.1 
Page 162  
 
   
Reply:   The issue relating to liberalization of Mode 4 needs to be viewed in the context of its 
significance for India. Under Mode 4, India has offered very liberal commitments for four categories of Natural Persons in the GATS negotiations. These categories are Business Visitors, Intra-corporate 
Transferees, Contractual Service Suppliers, and I ndependent Professionals. In this Mode India has  
requested its trading partners to undertake more liberal commitments with regard to admission of 
Independent Professionals and Contractual Serv ice Suppliers for provision of Services. The 
movement of Natural Persons is not expected to a create shortage of skilled manpower in India, as the 
pool is reasonably large and increasing continuously .  According to the Economic Survey of India 
2006-07, there has been an impressive growth in th e area of higher education with an increase in 
annual student enrolment from 7.26 million in 1997 -98 to 10.48 million in 2004-05. Moreover, India 
has a relatively large young population as compared to the ageing population of some other countries.  Liberalisation of access in  Mode 4 will not only enab le India to reap a demographic dividend but also 
help labour-scarce countries to derive benefits from their services.  Question 2:   Could India please elaborate on the role the NCMP plays in labour market reform? Furthermore, 
what are the key elements of change in labour laws acknowledged by NCMP? 
 
Reply:  The National Common Minimum Programme (NCMP) of the United Progressive Alliance 
(UPA) Government provides as follows:    “The UPA rejects the idea of automatic hire and fire. It recognizes that some changes in 
labour laws may be required but such changes must fu lly protect the interests of workers and families 
and must take place after full consultation with trade unions. The UPA will pursue a dialogue with 
industry and trade unions on this issue before co ming up with specific proposals. However, labour 
laws other than the Industrial Disputes Act that creates an Inspector Raj will be re-examined and 
procedures harmonized and streamlined. The UPA government firmly believes that labour-
management relations in our country must be mark ed by consultations, cooperation and consensus, 
not confrontation. Tripartite consultations with trade unions and industry on all proposals concerning 
them will be actively pursued. Rights and benefits earned by workers, including the right to strike 
according to law, will not be taken away or curtailed.”   Keeping the NCMP provisions in view,  amendment proposals in respect of certain acts have been initiated, which are  as below: 
 
(i) The Factories (Amendment) Bill 2005 has been introduced in the Lok Sabha on 16
 August 
2005. The Bill proposes to amend Section 66 of the Factories Act 1948, so as to provide flexibility in the matter of employment of wome n during night shift with adequate safeguards 
for their safety, dignity, honour and transporta tion from the factory premises to their nearest 
point of their residence. 
 
(ii) The Labour Laws (Exemption from Furnishing  Returns and Maintaining Registers by Certain 
Establishments) Act, 1988 presently provides for maintaining combined registers and submission of simplified returns in respect of  9 Scheduled Acts. It is applicable to 
establishments employing up to 19 persons only. It  is proposed to amend the Act in order to 
enlarge its scope by covering 16 Acts and esta blishments employing a larger number of 
persons with provision for maintaining regist ers on computer and sending returns through 
electronic means. An amendment Bill was intr oduced in the Rajya Sabha on 22 August 2005. 
Subsequently it was referred to the  Par liamentary Standing Committee on Labour for  
examination. The matter is being deliberated upon. 
  WT/TPR/M/182/Add.1 
 Page 163 
 
 
  (iii) An amendment bill in respect of  the Appren tices Act, 1961 has been introduced in the Rajya 
Sabha on 19 May, 2006 to provide :  (a) reservation for Other Backward Classes, (b) related 
instructions to be imparted at the cost of em ployer and (c) flexibility in respect of ratio’s 
prescribed for Apprenticeship Scheme. The Bill  has been referred to the Parliamentary 
Standing Committee on Labour for examination.  
 
(iv) The  Maternity Benefit (Amendment ) Bill,  2007 has been introduced in the Rajya Sabha on 
14 May, 2007  to raise the Medical Bonus payable under the Maternity Benefits Act, 1961 from Rs.250 to Rs.1000  and to give powers to  the Central Government to revise medical 
bonus from time to time subject to a maximum of Rs.20,000. 
 
 In order to create a dynamic labour market e nvironment, the  right balance of ‘flexibility’, 
‘stability’ and ‘security’ needs to be provided. While flexibility is required by the employers to adjust 
to the changing market conditions, the workers need to be provided with basic security. The endeavor 
of the Government has been to bring about labour reforms by following a consensual approach and to 
maintain harmonious industrial relations through ef fective intervention of Central and State Industrial 
Relations Machineries.  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 (iv) Role of state-owned enterprises and privatization 
 
Question 3: (Page 83, paragraph 151 and Box III.2) 
 
The recommendations of the Disinvestment Commissi on have focused mainly on minority or majority 
sales to a strategic partner. A foreign company, subj ect to the government’s sectoral policy on FDI, is 
eligible for due consideration.  
Could India please elaborate further on the cond itions under which a foreign company would be 
regarded as a strategic partner?  
Reply: A Strategic Sale, in the context of divestment in  Central Public Sector Undertakings in India, 
means the sale of a block of shares with transfer  of management control as a result of which the 
company ceases to be a Government Company as defi ned in the Companies Act, 1956.  A foreign 
company, which buys, subject to the sectoral cap for foreign direct investment such a block of shares 
with management control, can be regarded as a strategic partner in that particular company. 
 
Question 4:  
(Page 83, paragraph 152) 
 
On 6 July 2006, the government announced that it had “decided to keep all disinvestment decisions 
and proposals on hold pending further review.”  
 a) We would appreciate some further explanation of the reasons behind India’s decision to keep 
all disinvestment decisions and proposals on hold. 
 b) Could India please advise us of the timeline,  if it exists, for completing the reviews of the 
current privatization policy or for resu ming the disinvestment practices?  
 WT/TPR/M/182/Add.1 
Page 164  
 
  Reply (a) & (b):  The decision taken by the Government on 6 July, 2006 to keep all disinvestment 
decisions and proposals on hold, pending a further re view, was taken in the context of representations 
from different stakeholders. The said review is a continuing process and decisions are being taken on 
a case to case basis. Three Central Public Sector Undertakings in the power sector viz. the Rural 
Electrification Corporation Limited (REC), the Po wer Grid Corporation of India Limited (PGCIL) 
and the National Hydro-electric Power Corporation Limited (NHPC), propose to make public 
offerings of equity equal to 10% each of their pre- issue paid-up equity capital. The Government has, 
in February, 2007, decided for an ‘Offer for Sale’ of  10%, 5% and 5% of the pre-issue paid-up equity 
capital each of REC, PGCIL and NHPC. Recently, a decision has been taken to divest the Central 
Government’s share in Maruti Udyog Limited. 
 
(v) Intellectual property rights 
 
Question 5:  
(Page 86, paragraph 159) 
 
As indicated, in accordance with the Patents Act,  any person interested in working a patent can, after 
the expiry of three years from the date of grant of the patent, apply for the grant of a compulsory 
license. Grounds for granting a compulsory licen se are also provided in this paragraph. 
 a) We are interested in knowing what is Indi a’s rationale for establishing the above-mentioned 
three-year period before a person may appl y for a compulsory license?     
  b) Could India please explain further what conditions would constitute grounds for claiming that “the reasonable requirements of the public w ith respect to the patented invention have not been 
satisfied”?  
 
c)   What conditions would cons titute grounds for deciding that “the patented invention is not 
available at a reasonably affordable price” ? Does this criterion have any anti-competition 
connotations?  
Reply: A period of 3 years is considered reasonable fo r a patentee to work his invention. In case the 
patentee fails to work his invention within this peri od, then only an opportunity is given to others to 
work the invention through compulsory licenses. Th is provision is also in consonance with the 
provisions of the Paris Convention. [Article 5A (4)].   Section 84(7) of the Indian Patents Act provi des details of situations where the reasonable 
requirements of the public are deemed to have not been satisfied for the purpose of grant of 
compulsory licenses.  These are:    a) if, by reason of the refusal  of the patentee to grant a license or licenses on  reasonable terms,  
 
i) an existing trade or industry or the developm ent thereof or the establishment of any new 
trade or industry in India or the trade or industry of any person or  class of persons trading 
or manufacturing in India is prejudiced; or 
ii) the demand for the patented article has  not been met  to an adequate extent or on 
reasonable terms; or   
iii) a market for export of the patented article ma nufactured in India is not being supplied or 
developed; or 
iv) the establishment or development of commercial activities in India is prejudiced; or 
 b) if, by reason of conditions imposed by the patentee upon the grant of licences under the patent 
or upon the purchase, hire or use of the patented article or process, the manufacture, use or  WT/TPR/M/182/Add.1 
 Page 165 
 
 
  sale of materials not protected by the patent, or  the establishment or development of any trade 
or industry in India, is prejudiced; or  
 
c) if the patentee imposes a condition upon the gr ant of licences under the patent to provide 
exclusive grant back, prevention to challenges  to  the validity of patent or coercive package 
licensing; or 
 d) if the patented invention is not  being worked  in the territory of India on a commercial scale 
to an adequate extent or is not being so wo rked to the fullest extent that is reasonably 
practicable; or  
 
e) if the working of the patented invention in th e territory of India on a commercial scale is 
being prevented or hindered by the  importation from abroad of the patented article by:  
 
i) the patentee or persons claiming under him; or 
ii) persons directly or indirectly purchasing from him; or 
iii) other persons against whom the patentee is not taking or has not taken proceedings for 
infringement. 
  The reasonableness of the price of a patented invention is determined by the criteria of prevailing market prices. The Controller of Patent s can ascertain the prevailing market price of the 
patented product under the mechanism provided under the law. 
 
Question 6:  
(Page 91, paragraph 184) 
 
Under the Customs Act, Customs may seize and hold goods “for a reasonable period”, including for suspected violations of intellectual property rights. 
 
We would appreciate knowing whether, in cases where pirated goods have been identified, India’s 
Customs Administration is allowed to provide the right- holder concerned with information about the 
exporter, importer and quantity of the ship ment, and, If so, on what legal basis?  
 
Reply:  India has recently (on 8 May 2007) notified the Intellectual Property Rights (Imported Goods) 
Enforcement Rules, 2007 which have been fra med broadly based on the WCO Model Draft and 
provides the procedures to be followed by right hol ders as well as the cu stoms authorities governing 
the  release of imported goods infringing Intellectual Property Rights.  
(2) AGRICULTURE 
 
(ii) Agricultural policies 
 Question 7:  
(Page 107, paragraph 25) 
 As indicated, India last notified its AMS commitmen ts and its export subsidies to the WTO in March 
2002 for the period 1996/97-2000/01. The notification is to be updated as soon as more recent data 
are collected.  
Would it be possible for India to inform us as to  when the updated notification will be available?  
 WT/TPR/M/182/Add.1 
Page 166  
 
  Reply:  India has notified  its domestic support for the period 1996-97 and 1997-98 and its export 
subsidies to the WTO for the period 1996-97 to 2000-01 in March 2002.. The notification will be 
updated as soon as possible. 
 
Question 8: 
(Pages 108-109, paragraphs 27 and 28)  
A Price Support Scheme (PSS) and a Market Interventi on Scheme (MIS) have been put in place for 
various crops. Under the PSS, Minimum Support Pr ices (MSPs) for major field crops are announced 
by the government following the recommendations of  the Commission for Agricultural Costs and 
Prices (CACP). On the other hand, under the MIS,  the Market Intervention Price (MIP) is based on 
the cost of production. 
 
Could India please elaborate further on how the CACP would make its recommendations on MSPs under the PSS? Would the MSP of a crop also be referen ced to the cost of production, as is the case 
with an MSP under the MIS?  
Reply:  The Commission for Agricultural Costs and Prices (CACP) advises on price policy of major 
agricultural commodities with a view to evolving a balanced and integrated price structure in the 
perspective of the overall needs of the economy and w ith due regard to the interests of the producer 
and the consumer.  The Government’s price polic y for agricultural comm odities seeks to ensure 
equitable prices to the growers for their produce.  The price policy also seeks to evolve a balanced and 
integrated price structure from the perspective of the overall needs of the economy.  Accordingly, the 
Government announces Minimum Support Prices (MSPs) each season for major agricultural 
commodities taking into account the recommendations of the CACP.  
 
 In formulating the recommendations in respect of the level of minimum support prices and 
other non-price measures, the CACP takes into account, apart from a comprehensive view of the 
particular commodity or group of commodities, the following factors:  
(i) Cost of production 
(ii) Changes in input prices (iii) Input-output price parity (iv) Trends in market prices (v) Demand and supply (vi) Inter-crop price parity 
(vii) Effect on industrial cost structure 
(viii) Effect on cost of living (ix) Effect on general price level (x) International price situation (xi) Parity between prices paid and prices received by the farmers 
(xii) Effect on issue prices and implications for subsidy. 
 
Question 9:  
(Page 109, paragraph 29) 
 
It is stated that the Indian Government grants pri ce support to paddy (rice) through various agencies. 
An Indian farmer has the option to sell rice to th e government agencies at the MSP or in the open 
market. This procurement policy en sures that farmers recei ve remunerative prices for their produce. 
 
We would appreciate knowing whether, apart from the above-mentioned procurement policy, there 
are other price support projects for rice?   
Reply: No other price support scheme for rice exists other than the procurement policy.  WT/TPR/M/182/Add.1 
 Page 167 
 
 
  (3) E NERGY  
(i) Oil and gas  
Question 10:  
(Page 114, paragraphs 40 and 42)  
Foreign investment is restricted to 26% of total investment in public sector refineries. Apart from that 
refining sector, up to 100% foreign investment is allo wed in all activities in the oil and gas industry, 
including exploration, production, and marketing.   a) Could India please inform us of the rationale for differentiating refining from other activities 
in oil and gas sector?  
 b) Does India have a timeline for the relaxation of this restriction on foreign investment? If so, 
details of the anticipated timing would be appreciated 
 
Reply:  FDI Policy for the oil and gas sector has been lib eralized from time to time, and in accordance 
with the needs and priority felt for opening up pa rticular activities in the sector for   FDI.  
 
 The policy regarding FDI in activities involving public sector entities is linked to the 
Government’s policy towards the entity concerned re taining its public sector status and the overall 
policy of the Government regarding privatization of  PSUs. Therefore, no timeframe for relaxation of 
the condition can be laid down.   
 Currently, FDI  up to 100% through the automatic  route is available for refining activities in 
the private sector. The 26% FDI stipulation referred to is only applicable for refining entities in the 
public (JV) sector. There is no policy bar for any fore ign entity to come either on its own, or through a 
joint venture in the refining sector.  Question 11:  (Page 114, paragraphs 42 and 43)  It is stated that five private companies have been granted marketing rights for the transportation fuel. 
In addition, measures have been taken to encourage  exploration and production of oil and gas. Under 
the New Exploration Licensing Policy (NELP) ann ounced in 1997, 100% foreign investment was 
allowed in all types of exploration.   
Could India please to confirm whether: 
 a) oil production has been covered by the NELP? In other words, whether companies with 100% 
foreign investment would also be allowed to  join in oil and nat ural gas production? 
 
Reply:  Companies with 100% foreign investment are allowed to bid for e xploration blocks under 
NELP, and such companies have also been awarded blocks. Under the guidelines governing 
exploration and production for oil and natural gas, the successful bidders under NELP automatically 
have the right of production in the blocks explored by them.  Therefore, there is no bar to companies 
with 100% foreign investment to join in oil and natural gas production.  b) companies dominated by foreign investment, wh ich have been allowed to join in oil and 
natural gas exploration and production, w ould also be granted marketing rights?  
 Reply:  Companies which have been awarded bloc ks under NELP are working under the framework 
of the Production Sharing Contracts (PSC) signed with  the Government of India. Foreign Companies WT/TPR/M/182/Add.1 
Page 168  
 
  have been awarded full national treatment in obt aining marketing rights for petroleum products, if 
they fulfil the requirements of the sectoral regula tions which are identical for Indian and foreign 
Companies. 
 
c) any of the above-mentioned five private companies have been undertaking all the activities 
mentioned in a) and b) above?  
 
Reply:  Royal Dutch Shell has made the largest FDI in India among all integrated oil companies 
(around US$ 1 billion) and is the only global major so  far to have a retail license in India. Shell 
currently has interests in natural gas (in the form of liquefied natural gas - "LNG"), Lubricants, LPG 
(liquefied petroleum gas) and automobile fuel retailin g in India. However, Shell has chosen not to bid 
for any of the NELP rounds so far.  
Question 12:  
(Page 115, paragraph 45) 
 
It is stated that prices of kerosene and liquid pe troleum gas (LPG) remain subject to government 
control. The government also continues to monito r the prices of kerosene, LPG, motor spirit and 
diesel, in the interests of the weaker sections of society. 
a) Could India please explain the difference be tween “price control” and “price monitoring?”  
 Reply:  Government controls the prices of kerosene meant for the public distribution system (PDS) 
and LPG meant for domestic use (in 14.5 kg. cylinders) as sold by the public sector oil marketing 
companies. The Govermment provides upfront subsid y to the public sector oil companies through the 
budget for the purpose. 
 
 The prices of motor spirit and diesel (along with that of PDS kerosene and domestic LPG, which are also controlled)  are monitored by the Go vernment. In the event of the likely retail price of 
motor spirit and diesel becoming unsustainable for the economy when crude prices spurt, the 
Government  arranges to issue o il bonds to help out the public sector oil companies, and the public 
sector upstream companies also give discounts to the public sector downstream companies to meet a 
part of their losses, and only the balance of the high  cost incidence is passed on to the consumers.  
  
b) Would the measure for controlling or monitoring prices of kerosene and LPG be the 
equivalent of establishing minimum import prices on those products?  
 c) Does India have a timeline for the release of th e said price control or monitoring measures? 
If so, details would be appreciated.   
Reply:  
 b) This cannot be considered the equivale nt of establishing minimum import prices on the 
relevant products.  c) No timelines can be prescribed for the repeal of the said price control or price monitoring 
measures. 
 
Question 13 
(Page 116, paragraph 49)  
As indicated, the Indian electricity industry is regulated by the Central Electricity Regulatory 
Commission (CERC) and the State Electricity Regulatory Commissions (SERCs) at the central and  WT/TPR/M/182/Add.1 
 Page 169 
 
 
  State level respectively. The CERC is also in char ge of regulating the tariff of generating companies 
that operate across States, as well as inter-State transmission. 
We are interested in knowing whether the CERC w ould have to consult with the SERCs concerned in 
matters involving more than one State? Is there  an established mechanism for the CERC to 
coordinate different views or even settle disputes between States?   
 Reply:  Although the CERC is not required to consu lt with the SERCs in matters falling under the 
jurisdiction of CERC, the law provides for a coordi nation mechanism.  The Central Government has 
constituted the Forum of Regulators (as provided in the Act) consisting of the Chairperson of the 
CERC and Chairpersons of the State Electricity Regulatory Commissions (SERC). The Chairperson, 
CERC is the Chairperson of the Forum. The rules prescribing the functions of the Forum have been 
notified on 16 February 2005. The rules provide fo r an analysis of the tariff orders of CERC and 
SERCs, harmonization of regulations, laying of stan dards of performance of licensees and sharing of 
information on various issues of common interest as also to evolve a common approach among the 
Regulatory Commissions.  
  One of the functions of the CERC as laid down in the Act is to adjudicate in disputes 
involving generating companies or transmission licen sees in the matters falling under its jurisdiction 
and also to refer disputes for arbitration. 
 
Question 14:  
(Pages 116-117, paragraphs 51- 53)  As indicated, amount of foreign investment attrac ted in electricity generation, transmission, and 
distribution is low in India. The low foreign and pr ivate investment has to a certain extent constrained 
the growth of the electricity industry, and even the development of the economy. One of the main 
reasons leading to the said low foreign participa tion is that generating companies could not choose 
their customers, and in practice they may have to sell electricity to State Electricity Boards (SEBs). 
But, with financial difficulties, SEBs have not been able to pay fully for the purchase of electricity 
generated by private power producers.   
We are interested in knowing whether India has developed a plan to attract foreign investment more 
effectively in the electricity sector? For examp le, does the government intend to allow private 
generating companies to choose customers of their own free will? Or, what actions might be taken to improve the financial structures of SEBs?    
Reply:  100% foreign direct investment in generation,  transmission, distribution and trading (except 
for atomic energy) has been permitted on the automati c approval route.  Private sector investment in 
generation and transmission is being invited thro ugh a transparent process of tariff based competitive 
bidding.   
 A generating company, whether private or public, can sell electricity to a distribution licensee 
of its choice and also to a consumer who has been  granted open access by the SERC.  The Electricity 
Act requires the SERC to provide by January, 2009, open access to all consumers who require a supply of electricity where the maximum power to be made available at any time exceeds 1 
megawatt,.  Action to operationalise open access in dist ribution has already been initiated as is evident 
from the following facts: 
 
• 23 SERCs have so far issued regulations on open access in distribution. 
• 19 SERCs have issued the methodology for de termining the charges for transmission, 
wheeling and cross-subsidy surcharge.  WT/TPR/M/182/Add.1 
Page 170  
 
  • 29 applications of open access in 9 States have  been approved out of which 9 have also 
been implemented. 
  The Central Government has provided the fo llowing support for improving the financial 
health of the distribution utilities. 
 
• Assistance for distribution system:  APDRP (Accelerated Power Development & Reforms 
Programme). 
• Securitisation of past dues of distribution companies towards Central Utilities. 
• Strengthening & improvement of transmi ssion network by POWERGRID: 2990 Ckt. Km 
added during 2004-05. 
• Concessional financing by Power Finance Corporation. 
• Arranging international funding for power sector reforms in a number of States. 
  The Electricity Act, 2003 mandates the payment of compensation in advance by the States to 
the distribution utilities if the States desi re any subsidy in the consumer tariff. 
 
Question 15:  
(Page 130, paragraph 100)   
As a start-up contribution, the parent bank shoul d provide a minimum of US$ 10 million to its 
offshore banking unit (OBU).   This above-mentioned capital requirement far exceeds th e level that applies within our territory in 
similar situations, therefore we would appreciate knowing: 
 a)  What is the reason for such a high threshold for setting up an OBU?  
 b)  Under what conditions would India consider lowering the said threshold? 
 Reply: Since OBUs are branches of banks, either Indian or foreign, with physi cal presence in India, 
no separate assigned capital for OBUs has been prescrib ed. However, with a with a view to enable 
them to start their operations, the parent bank is required to provide a minimum of US$10 million to 
its OBU.  
 
(iv) Telecommunications 
 
Question 16:  
(Page 134, paragraph 118)  
It is stated that the Indian Government allows 100% foreign ownership for Internet service providers 
(ISPs) without gateways, infrastructure providers providing dark fibre, and electronic and voice mail 
services. However, companies providin g these services must divest 26% of equity to the Indian public 
in five years, if they are listed outside India.  a)  Could India please explain the rationale for introducing the aforementioned requirement for 
lowering foreign equity participation?  
 
Reply:   This is a policy decision taken by th e Government in the national interest..  
 
b) As also indicated in this paragraph, in No vember 2005 foreign investment equity restrictions 
were increased from 49% to 74% in certain areas, such as fixed line, cellu lar, unified access services  WT/TPR/M/182/Add.1 
 Page 171 
 
 
  and national and international long-distance calls  services. However, we have noted that this 
autonomous liberalization effort was not included in India’s revised services offer (TN/S/O/ IND/Rev.1). We would therefore appreciate knowing wh ether India has the intention of binding this 
autonomous liberalization effort in its second revised offer on services?  
 Reply:  India would take a decision on binding its au tonomous liberalisation depending on the quality 
of offers in all sectors and Modes (especially Modes 1 and 4) of services  by other Members. 
 
17. Could India please confirm whether private co mpanies are allowed to provide the nine Port 
Services (Pilotage, Towing, Tug Assistance and pushing,  Port Captain Services, Navigation Aids etc.) 
listed as additional commitments under the Maritime Transport Services Section of India’s revised 
offer?  If so, are there limitations on foreign par ticipation for each of the above mentioned services. 
 
Reply:  The existing Government guidelines provide for pr ivate sector participation in pilotage. It also 
provides for leasing of equipment for port handling and leasing of floating crafts from the private 
sector. Also, under the Government Policy, foreign direct investment upto 100% under the automatic 
route is permitted in constructi on and maintenance of ports and harbours. However, individual 
proposals will be subject to necessary cl earances, including security clearance. 
 
II. INDIA - FUTURE GROWTH PROSPECTS 
 
(b) Major challenges to growth 
 
(i)  Infrastructure deficit  
 Question 18:  (Page 7, paragraph 15) 
 
The Electricity Act, 2003, provides that the SERCs shall adopt tariffs through a transparent process of 
bidding. This approach to tariff determination is expected to encourage private sector investment.  
 
a) Could India please explain further how the ab ove-mentioned approach to tariff determination 
would encourage private sector investment?  b) Given the fact that the amount of foreign investme nt in the electricity industry still seems to be 
low (Secretariat Report; page 7, paragraph 15), could India please  provide details of any plans it 
might have to bridge the gap?  Reply:   
a) Since the tariff is determined through a bidding  process, there is no scrutiny of capital costs 
and hence no scope for dispute over completion cost etc. Further, the private power generators are 
entitled to sell power to bulk consumers without the intermediation of the State Electricity Boards.   
 
b) The Ultra Mega Power Projects which are being facilitated by the Central 
Government, are aimed at expediting the process of bridging the gap in installed capacity and also 
enhancing private sector participation. A number of  foreign investors have shown interest in these 
projects. Further, it is proposed to invite bids for transmission projects also. 
 
Question 19:  
(Page 8, paragraph 21)  
As indicated, the Indian government is encour aging the use of hydro and wind energy sources.  WT/TPR/M/182/Add.1 
Page 172  
 
   
Could India please provide further details of the me asures that have been taken  to encourage the use 
of hydro and wind energy sources so far? 
 
Reply:  
Hydro Power Under the Act, there is no longer a require ment of techno-economic clearance of the 
Central Electricity Authority (CEA). Only the large hydro projects require concurrence of CEA 
wherever the capital cost exceeds the lim it notified by the Central Government. 
  The Central Government has taken the 50,000 MW  hydro initiative for development of such 
capacity from hydro plants. Under the initiative, the Project Feasibility Reports are made in advance.  
 
 The Power Finance Corporation is providing long term finance for hydro projects.  
 
The Tariff Policy provides for separate tariffs fo r peak and off peak power. This arrangement 
gives a distinct advantage to hydro projects which can supply peaking power.   
 
Power from Renewable Sources such as wind energy: One of the functions of the SERCs laid 
down in the Act is to promote  generation of  electricity from renewable sources of energy by 
providing suitable measures for connectivity with the grid  and  sale of electricity to any person, and 
also to specify  for purchase  of electricity from  such sources, a percentage of the total  consumption 
of electricity in the area  of  a distribution licensee.  
The Tariff Policy requires the SERCs to fix a minimum percentage for purchase of energy 
from such sources taking into account the availability of  such resources in the region and its impact on 
retail tariffs. The policy stipulates that since it  will take some time before non-conventional 
technologies can compete with conventional sources in terms of cost of electricity, procurement by distribution companies shall be done at prefer ential tariffs determined by the SERCs.   
 
A number of SERCs have already specified this pe rcentage in the range of 1 to 5 % generally.  
 
The Ministry of Non-Conventional Energy S ources provides financial incentives, such as 
interest subsidy and capital subsidy. In addition, so ft loans are provided thro ugh the Indian Renewable 
Energy Development Agency (IREDA), a public sect or company of the Ministry and also through 
some of the nationalized Banks and other financia l Institutions for identified technologies/systems.  
  The Government also provides various types of  fiscal incentives for renewable energy sector, 
which include direct taxes -100% depreciation in the first year of the installation of the project, exemption/reduction in excise duty, exemption from central sales tax, and customs duty concessions 
on the import of material, components and equipment used in renewable energy projects. 
 
20. We are interested in re ceiving further details of the National Maritime Development 
Programme.  In addition to increasing the capacity, coul d efforts in other area s also the crucial to 
making India’s Ports globally competitive? 
 Reply:  The Maritime Sector including Ports and Shi pping provide the platform for transportation of 
95% by volume and 70% by value, of India’s global  merchandise trade. Recognizing the crucial role 
which the sector will have to play in achievi ng India’s trade objectives, the National Maritime 
Development Programme (NMDP) has been formulat ed.  This can be accessed on the Department’s 
website <http://shipping.nic.in>. Under the Progr amme, specific projects to be taken up for 
implementation over a defined period have been id entified.  The total investment involved under the  WT/TPR/M/182/Add.1 
 Page 173 
 
 
  Programme is US$ 22.30 billion.  Out of this, US$ 12. 40 billion  is for the Port Sector and the balance 
is for the Shipping and Inland Water Transport Sectors.    In the major ports, 276 projects covering the entire gamut of activities, namely construction/upgradation of berths, deepening of ch annels, rail/road connectivity projects, equipment 
upgradation/modernization schemes and other relate d schemes for creation of backup facilities have 
been identified for inclusion in the Programme. Thes e projects will be taken up for implementation in 
two phases over a period upto 2011-12. Out of these, about US$ 7.67 billion is expected from  the 
private sector, mainly in commercially viable pr ojects like development and operation of berths, 
terminals, etc. Public funds will be concentrated for creation of common user infrastructure facilities.  
 
 Implementation of the projects under the NM DP is expected to result in increased 
productivity and improvement in the quality of service of the Major Ports and enhance their 
competitiveness.  (iv) Skill deficit in manpower  Question 21: (Page 14, paragraph 57)  As talent supply shortages are emerging, India w ill undertake major reform at all levels of education 
aimed at ensuring that the quality and numbers of professionals needed by the country are met. We 
also note that India is trying to ensure that the IT sector does not face a shortage of quality manpower. (Government Report:  page 21, paragraph 99) 
 It would be appropriate if India could elaborate on whether any other professionals are on the 
priority list under India’s manpower policy relating to the knowledge services sector? 
 
Reply:  According to the Economic Survey of India 2006- 07, there has been an impressive growth in 
the area of higher education with an increase in annula student enrolment from 7.26 million in 1997-98 to 10.48 million in 2004-05. I ndia has a relatively young population compared to many other 
countries. India looks towards developing adequate  human resources in the traditional fields of 
science and technology as well as in new emerging fi elds like bio-technology, nanotechnology etc. 
 
V. TRADE FACILITATION 
 
Question 22:  
(Page 17, paragraph 73)  As indicated, the Indian government has taken m any measures to expedite Customs clearance 
procedures. We have been informed by some of  our traders, however, that they have experienced 
difficulties in re-exporting their goods as the buyers in India failed to fulfill their payment 
responsibilities.  
Could India please elaborate further on exactly how Customs procedures for returned goods would 
be streamlined?  
 
Reply: This is a specific issue where goods are sought to  be re-exported because a buyer in India has 
failed to fulfill his payment responsibilities. Such cases can be dealt with only  when the exporter of 
goods informs customs or an agency in India on beha lf of the exporter brings this to the notice of 
customs. Normally customs responsibilities end after the release order for the goods is given on the 
basis of the entry document filed. Specific cases, if  any, have to be brought to the notice of the 
customs administration. WT/TPR/M/182/Add.1 
Page 174  
 
  VI. STRENGTHENING SECTORAL MARKETS 
 (d) Information technology  
 
Question 23:  
(Page 21, paragraph 97)    It is stated that since India is a member of the Information Technology Agreement (ITA), tariffs on all 
the 217 tariff lines have been eliminated from Marc h 2005. According to India’s “Customs Tariff 
2006-2007” (www.cbec.gov.in/customs/cst-0607/cst-main. htm), however, it seems that tariff rates on 
certain products covered by the ITA, say, aerials and other parts that fall under HS 8529, have not 
been eliminated.  
Could India please clarify whether all its commitm ents made under the ITA have been completely 
fulfilled? 
 Reply:  All commitments made by India under the In formation Technology Agreement (ITA) have 
been fulfilled. Aerials and antennae of a kind u sed with apparatus for radio telephony and radio 
telegraphy are exempted from customs duty vi de notification no. 25 dated 1 March 2005. 
 
Question 24:  
(Page 23, paragraph 109)   
 As indicated in the Report, the foreign exchange regim e of India is now considered to be one of the 
most liberal amongst countries where restrictions on th e capital account still exist. On the other hand, 
we have learned from the “Foreign Exchange Manageme nt Act” of India that all foreign investments 
and profits earned are freely repatriable,  except those under non-repatriable schemes.  
It would therefore be appreciated if India could prov ide us with more detailed information about its 
foreign exchange regulations relating to non-repatriable schemes.  
Such information may include, but not be limited to, the following: 
a) Whether non-residents could transfer or reduce their investments in India?  
b) Whether non-residents could repatriate their ea rnings after a certain number of years of 
investment?  
Reply: Investments into India are permitted on repatr iation basis in accordance with the sectoral 
policy for Foreign Direct Investments announced by the Government and notified under the FEMA 
regulations. As such all investments by non resident s  eligible to invest in India are permitted on 
repatriation basis only   The investments on non repatriation basis whic h is provided for under the FEMA regulations 
is allowed essentially to Non resident Indians (NRIs)  as  a legacy  of the facilities/Schemes framed in 
the past for  investments by NRIs on non repatriation basis . 
 
 The Government has also clarified vide Pr ess Note 4(2005 series) th at the investments by 
NRIs on non repatriation basis can be considered  as repatriable investments provided the amount 
originally invested was brought in by way of foreign remittance through the banking channels. As 
such, the facility already exists to reclassify  the non repatriable investments as repatriable 
investments. 
 
 Such investments are allowed out of their dom estic resources in India with the pre-conditions 
that on redemption, the sale /maturity proceeds are to be credited only to the account from which the 
purchase consideration was paid out or to the N on-Resident Ordinary Rupee (NRO) account of the  WT/TPR/M/182/Add.1 
 Page 175 
 
 
  seller if the investments were made out of funds  held in NRO/NRE/FCNR accounts and neither the 
amount invested nor capital appreciation is  allowed to be repatriated abroad. 
 
Income arising from such investments is a curre nt account transaction and repatriation of such 
earnings is freely permitted subject to compliance with the Tax requirements.  
 
 In January 2003 it was decided that Non-Resident  Indians (NRIs) can remit  the balances out 
of their NRO accounts upto USD 1 million per financia l year. This facility for capital transfer would 
enable NRIs to reduce their investments held on non repatriation  basis in India.  (v) Insurance sector  Question 25:  (Page 28, paragraph 132)   
 
As indicated, the insurance industry in India has witnessed very fast growth over the past five years. 
We understand that micro insurance is a vital vehicle  in the provision of insurance cover to the poor, 
thus strengthening the social safety net.  
 We have also learned that ample experience now exists in India and remarkable progress has been 
made in developing an enabling regulatory framework for micro insurance. It would be appreciated if 
India could please provide us with  further details of its micro insurance regulations and practices? 
 
Reply:  The Insurance Regulatory and Development Au thority (IRDA) had notified Micro Insurance 
Regulations on 10.11.2005, which provide a frame work for insurers to design suitable micro 
insurance products. As per these regulations, norms ar e laid down to recognize micro insurance agents 
like Non-Government Organisations(NGO) and Self Help Groups (SHG).   Some of the salient features of the Regulations include:   
 
(i) tie up between one life and one one-life insurance company to market micro-
insurance products.  The tie up can be either  at product level or at distribution level; 
(ii) NGO’s/MFI’s and SHGs are allowed to dist ribute micro-insurance products as micro-
insurance agents.  The normal distribution ch annels, i.e. agents, corporate agents and 
brokers can also distribute micro-insurance products; 
(iii) the model adopted for micro-insurance is the principal/agent model; 
(iv) micro-insurance sold would be recognized wh ile reckoning the social and rural sector 
obligation; 
(v) some restrictions are prescribed in the minimum and maximum sum assured for 
endowment insurance, term insurance, health  insurance, dwelling insurance, livestock 
insurance etc; 
(vi) all life insurance products are available for a maximum term of fifteen years; 
(vii) commission to be paid on life insurance pr oducts increased to twenty percent of the 
premium for the whole of premium-paying term; 
(viii) the minimum qualification for appointment as an insurance agent is removed, and the 
requirement of hundred hours of training followed by an examination waived; 
(ix) the insurance company has to impart twenty-five hours of training  to micro-
insurance agent as part of capacity building; 
(x) all products designed to be sold as micro-insu rance products have to  be cleared by the 
Authority and have to clearly identify th emselves as micro-insurance products when 
launched in the market; 
(xi) the insurance contracts are to be delivered in local language to the policy holders; WT/TPR/M/182/Add.1 
Page 176  
 
  (xii) all micro-insurance products will necessarily  be underwritten by insurance companies 
only; and 
(xiii) for group insurance products, the minimum size of the group is reckoned at twenty. 
  AUSTRALIA
 
 
1.  Australia commends India’s reduction of MFN tariff rates on non-agricultural products since 
the previous Review (WT/TPR/S/182, page 33 para 1) .  Does India intend to make similar reductions 
to tariffs on agricultural products to reduce the le vel of variance between tariffs on agricultural and 
non-agricultural products? 
 
Reply:  It is not possible to predict decisions that might be taken in future.  
 
2. We note the complexity in the way in whic h applied tariffs are determined and the numerous 
exceptions underlying this process (WT/TPR/S/182,  page 38 para 21).  Has India considered 
alternative methods in which determinations of  applied tariffs are made to increase stability and 
consistency to local businesses?  
Reply: To the extent possible, the applied rates have been shown in the Tariff Schedule.  
Notifications are issued only for providing MFN applie d rates lower than the tariff rates.  There is no 
proposal at present to change the current practice.  
 
3. India levies tariffs on most imports on an ad valorem basis, but tariffs on two products are 
specific duties (WT/TPR/S/182, page 40 para 26).  What is the reason for these exceptions from 
India’s general approach of levying tariffs on an ad valorem basis?  Has India considered converting 
these non-ad valorem tariffs to ad valorem tariffs? 
 
Reply: Generally tariffs are kept on ad valorem basis.  Specific rates have been prescribed in some 
cases taking into account the difficulties of valuation. It will not be possible to predict future policy 
decisions.  
 
4. We note that India maintains tariff rate quot as (TRQs) on a number of  products (milk powder, 
maize, crude sunflower seed and safflower oil and refin ed rape, colza and mustard oil), but that there 
have been no requests from designated agencies for rape, colza or mustard oil since 2002/03 and the 
last request for milk powder was in 2003/04.  Australia is concerned that quota licences are 
consequently not being issued for some of these produc ts, even though the fact that imports of some of 
these products has been occurring, presumably at th e out-of-quota rate (WT/TPR/S/182, page 44 para 
33), shows that there is demand.  
(i) Can India provide further information on the ‘designated agencies’ who can request 
TRQs? 
(ii) Can India explain on what basis these designat ed agencies decide whether to request 
TRQs in a given year, including how they a ssess whether there is demand for the products 
covered? 
 
Reply:  All eligible entities desiring to avail the quot a as mentioned above, may make application to 
Directorate General of Foreign Trade based on the requests or expression of interest (which is market 
driven) received from desirous importers. Completed application forms must reach on or before 1st 
March of each financial year preceding the year of  quota. Imports have to be completed before 31st 
March of the financial year for which the quota has been allocated. Further details of the TRQ 
administration are available at the website www.dgft.gov.in. 
  WT/TPR/M/182/Add.1 
 Page 177 
 
 
  5.  We note that India is yet to submit no tifications under Article 18.2 of the Agreement on 
Agriculture relating to tariff quota administrati on (Notification MA:1) and fill rates (Notification 
MA:2). Australia would appreciated  India’s advice on when it inte nds to make these notifications and 
provide Members with an opportunity to review its tariff quota arrangements? 
 
Reply:  India has not notified these tariff-rate quotas to the WTO but plans to do so as soon as 
possible.  
6. We understand that Indian Commerce department officials a nnounced in 2005, 2006 and 
2007 (at the time of the release of the annual Foreign Trade Policy Supplement) that the Department 
will finalise a ‘WTO complaint’ alternative to  the ‘Duty Entitlement Pass Book’ scheme (see 
WT/RPR/S/182, page 180, Table AIII.4) for Indian exporters within a year.  What is the progress on finalizing the alternative to the DEPB Scheme?   
Reply:  The alternative to the DEPB Scheme is under consideration. 
 
7. In responses to questions to the WTO Committ ee on Import Licensing, India has informed the 
Committee that no imports are made into India on th e basis of export permits.  Australia understands 
that India maintains an advance licence (AL) Scheme  for some products, including sugar.  Australia 
also understands that imports under the AL scheme fo r sugar are conditional on the export of fixed 
quantities of sugar, in proporti on to the quantity imported. 
(i) Could India provide a description of the AL Scheme, including the product coverage and 
any special product-specific arrangements, together with advice of any subsidies 
available for the exported product? 
(ii) Could India provide data on imports – on a pr oduct-by-product basis – of imports under 
the AL Scheme, together with total imports of those products? 
(iii) Could India provide information on the basis  for deciding eligibility of a product under 
the scheme? 
(iv) Is the grant of a licence under the AL Scheme  subject to quantitative limits, either at the 
level of licence holder or within an overall fixed product ceiling?  
 Reply:   
 
(i) The Advance licence (replaced by the Advance Au thorisation Scheme allows duty free import 
of inputs required for the manufacture of expor t product. Advance Authorisation Scheme is 
not product specific and any exporter applicant who qualifies for the scheme can avail himself 
of duty  neutralisation on inputs under the scheme. Inputs allowed are strictly as per the 
Standard Input Output Norms (SION) notifie d based on the recommendations of a technical 
committee. 
 (ii) Consolidated product by product data is not  available for imports under the Advance 
Authorisation Scheme.  However, the total im port figure for any tariff line can be obtained 
from the Department of Commerce website www.commerce.nic.in. 
 
(iii) The Scheme is available to any manufactur er exporter and merchant exporter tied to a 
manufacturer. 
 (iv) There is no quantitative limit either at the leve l of licence holder or within an overall fixed 
product ceiling unless otherwise specified. It is s ubject to the condition that the exporter is not 
a defaulter.  
 WT/TPR/M/182/Add.1 
Page 178  
 
  8. Australia welcomes India’s decision to conso lidate 13 separate laws under a new Food Safety 
and Standards Act 2006 and that a National Food Safety and Standards Authority (‘the Authority’) 
will be established (WT/TPR/S/182 , page 54, paragraph 57). 
 (a) Could India provide more details about the exten t to which imported goods will be regulated 
by the Authority under the new food regulation syst em? In particular, if any specific requirements 
and/or enforcement activities would apply only to imported goods.  (b) Could India indicate when the new regulation system will be in place? 
 
Reply:  The Food Safety and Standard Act, 2006 has b een passed by the Parliament and is being 
notified for its implementation.   
(c) Could India indicate the extent to which re quirements under the new food regulation system 
will align with the standards, code of practices and other texts adopted by the Codex Alimentarius 
Commission (Codex).  
 
Reply:  The standards laid down by the Codex Alimen tarius Commission are invariably taken into 
consideration while setting the national standards, thereby harmonizing them with the international 
standards.   9. Australia understands that India was cons idering implementing the issuance of electronic 
import permits across India to ensure consisten cy and validity of import permits. Can India outline 
what progress has been made regarding utilising electronic systems?  
Reply: The process of issuance and utilization of authorizations issued under various Export 
Promotion schemes is in an advanced stage of  implementation. The message exchange system 
between Customs and the Directorate General of Fo reign Trade has been operationalized for the Duty 
Entitlement Passbook Scheme (DEPB) and fo r the Advance Authorization Scheme. 
 
10. We note that India’s imports of livestock and meat products are regulated under the Livestock 
Importation Act 1898 and the Meat Food Produc ts Order 1973 and require an import permit 
(WT/TPR/S/182, page 55, paragraph 59).  Further,  India’s Livestock Importation Act Schedule  on 
the Procedure for Import of Livestock Products into  India,  clause (3)(ii), requires that “The import 
risk analysis shall be conducted by the concerned  officers of the Department on the basis of 
internationally recognized  scientific   principles of risk analysis and the analysis  shall be conducted  
with reference  to the specific  product and the disease situation prevailing  in the exporting country 
vis-à-vis the disease  situation in India”. 
 (a) We would appreciate details on India’s pro cess for conducting science-based import risk 
assessments to establish quarantine requirements for animals and animal produc ts.  In particular, 
Australia seeks details of the sci entific risk assessments India has conducted to develop the current 
import conditions for animals including cattle , sheep, goats and rabbits and meat products. 
 Reply: The determination of SPS measures is based on a ri sk analysis process so as to protect animal 
and human health of the country. The import risk an alysis is conducted in c onsultation with technical 
experts on the basis of well recognized scientific pr inciples and with reference to the specific product 
and the disease situation prevailing in the exporting country vis-à-vis the disease situation in India. 
The same principle has be en used in the formulation of sanitary conditions for the import of cattle, 
sheep, goats, rabbits and meat products into the country. The SPS measures in force are on the basis 
of scientific principles of risk analysis and on the lines of well recognized international standards 
including those of Codex, OIE, IPPC etc.  
  WT/TPR/M/182/Add.1 
 Page 179 
 
 
  (b) We would appreciate details of how these risk assessments take into  account the different 
health status of exporting countries and how they are applied consistently when the disease status is 
the same.  
Reply: The health protocol of India is product specifi c and takes into account the disease situation in 
India vis-à-vis the disease situation prevailing in ot her countries.  The health protocol is uniformly 
applicable to all countries. The country desirous of exports of a livestock prod uct to India has to meet 
the health protocol conditions of the specific product. 
 
11. India’s current import requirements for cattle and sheep include restrictions for pestiviruses, 
and for sheep there are restrictions fo r border disease which are caused by a pestivirus. Pestiviruses 
are considered endemic in most major sheep produci ng countries. Australia would appreciate details 
of India’s health status regarding pestiviruses  and information on any surveillance programme to 
support claims for country or zone disease freedom or animal health control programs in place to 
manage the disease. 
 Reply: India is free from pestivirsues causing diseases like Bovine Viral Diarrhoea and Border 
disease as there is no confirmed report of occurren ce of these diseases in the country. Further, India 
notifies regularly to OIE the notifiable diseases and t hus the disease status of the country in respect of 
such diseases is available on the OIE web site . The country has 8720 veterinary hospitals, 17820 
dispensaries and 250 State Disease Diagnostic Laborato ries.  One Central and five Regional Disease 
Diagnostic Laboratories provide referral diagnostic services. Further, there are 35 Veterinary 
colleges/universities which have specialized disease  diagnostic laboratories.  The incidences of 
various diseases in a state are recorded and compil ed by the concerned State Animal Husbandry 
Departments. There is a fairly extensiv e disease surveillance network in the country.  
 
12. Import Permits issued by India for pi g and sheep meat and meat products require 
certification attesting to freedom from many common animal diseases  that are endemic in both India 
and Australia.  Australia seeks India’s advice as to  the basis for such requirements and any available 
data to demonstrate that the disease agents may be  transmitted in the meat of healthy animals. 
 
Reply: Technical discussions with Australia on sanitary  conditions related to certain livestock and 
livestock products including meat were held on 26 Fe bruary 2007, during which the issues mentioned 
in the question were discussed. The information related to diseases of concern to each side was 
exchanged in the meeting and it was agreed that on certain issues Australia would provide additional 
information so as to meet the intent of India’s curre nt requirements for further consideration by India. 
However, the above details have not b een received from Australia as yet.  
 13. Import Permits issued by India for pig and poultry meat and meat products require that the 
source animals have never been fed with feeds produc ed from internal organs , blood meal and tissues 
of ruminant origin (ie. Ruminant-derived meat and bone meal). Australia is not aware of any scientific information supporting a ban on the feedin g of ruminant-derived meat and bone meal to 
pigs or poultry.  Can India provide advice as to the basis (e g. Scientific risk assessment) including 
whether it is based on OIE guidelines? 
 
Reply: The detailed scientific information regarding the basis of stipulation of the condition that the 
source animals have never been fed with feed pro duced from internal organs, blood meal and tissues 
of ruminant origin, is available with the Departme nt of Animal Husbandry, Fisheries and Dairying, 
Government of India, which India is prepared to share with Australia. However, it is clarified that 
Bovine Spongiform Encephalopathy (BSE) or ma d cow disease is known to be associated with 
feeding of Meat and Bone Meal (MBM). Moreover,  Prion (which causes BSE) are known to cross the 
species barrier as the di sease has not only affected cattle and sheep but goat and human beings as WT/TPR/M/182/Add.1 
Page 180  
 
  well. India being free of BSE, the concerns relate d to prevention of BSE outbreak in the country are 
appropriate.   
 
14. For more than three years now India has operated a prohibition on the import of dairy products made from milk derived  from cattle which have had oestrogen treatment within the past 90 
days. 
 
(i) Australia seeks India’s advice as to the basis  of this prohibition and the scientific 
evidence which justifies this requirement. 
(ii) Can India advise whether oestrogen is permitte d as a veterinary medicine in the country? 
(iii) If oestrogen is allowed for use in India, what measures  are in place to ensure that 
consumers are not exposed to dairy products m ade from milk derived from cattle which 
have been treated with oestrogen?  How is th e milk from cows treated with oestrogen 
disposed of for the 90 days following such treatment? 
(iv) If oestrogen is not allowed to be used in  India, does India have a testing program to 
regulate the ban, and if so, how does the testi ng differentiate between naturally occurring 
oestrogen and exogenous oestrogen? 
  
Reply:  As per Joint FAO/WHO Expert Committee on Food Additives Report, estradiol-17 β 
(oestrogen hormone) has genotoxic potential. The cond ition related to oestrogen treatment has been, 
therefore, stipulated in India’s health protocol k eeping in view human health concerns. However, the 
concerns of Australia regardi ng this condition were also discussed during the Technical level 
discussions had between the two countries in February 2007.  It was agreed during the discussions that Australia would provide information related to the scientific evidence supporting the safety aspect 
of oestrogen residue in the “milk” of oestrogen horm one treated cattle for consideration by India. The 
information in this regard is yet to be received fro m Australia.  The issues related to oestrogen would 
be further responded to on receipt of the requisite information from Australia. 
 
15. In the light of the observations in the Secret ariat’s report on this issue (WT/TPR/S/182, page 
59, Para 78), could India advise whether it is giving any further consideration towards accession to 
the WTO Agreement on Government Procurement.   
Reply:   The issue of India’s accession to GPA is under examination.  
 
16. Since India’s introduction of the disclosure requirement for patent applications involving 
traditional knowledge /genetic resources, how m any applications have been accepted under this 
provision and what did they covered?  
 
a. How many applications have been rejected and what did they cover? 
b. What is the distribution between domestic and foreign applicants?  
 
Reply: Traditional Knowledge pe r se is not patentable under the Patents Act [vide Section 3 (p)]. 
Disclosure requirement is mandatory only for inven tions where biological material is used by the 
applicant [vide Section 10 (4) (d) (ii) (D) of the Pa tents Act]. The Patents Act contains provisions for 
depositing the biological material in any of the r ecognized international depositories. India has one 
such recognized deposition authority at Chandigarh , India (Microbial Type Culture Collection and 
Gene Bank).  Data relating to patent applica tions based on biological materials are not being 
maintained by the Patent Office at this juncture. However, with the computerization of the Patent 
Office currently being undertaken, it will be possible to provide such data in future. 
  The Biodiversity Act, 2002 provides for obtaining permission for use of the biological material. This Act also provides for provisions relati ng to benefit sharing and prior informed consent.  WT/TPR/M/182/Add.1 
 Page 181 
 
 
  A National Biodiversity Authority has also been es tablished to implement th e provisions of benefit 
sharing and prior informed consent  
17. Can India provide information regardi ng the operation of the Customs Act in 
prohibiting/restricting the import or export of goods  that infringe IP rights (WT/TPR/S/182, page 91, 
para 184).  For example, can India provide any statistics on 
  a) how many cases there have been and in which areas eg. Patents, trade marks and copyright? 
 b) how many cases have involved domestic  or foreign individuals/companies? 
 
18. Does India plan to accede to the WIPO Internet treaties?  
 19. What legislative and law enforcement meas ures does India have to address civil and criminal 
on-line infringement?  
 
20. Does India have legislation that provides for the collective management of copyright?  
 
Reply to Qs 17, 18, 19 & 20:  The operational details prohibiting / restricting the import or export of 
goods infringing trade mark rights are governed by the regulations /notifications issued under the Customs Act 1962. Sections 139 and 140 of the Trad emarks Act 1999 provide sufficient safeguards to 
protect a registered trade mark embossed on the goods meant for export or import respectively.  
  Under section 140 of The Trade Marks Act, Commi ssioner of Customs, either on a complaint 
received or of his own motion may require the importer of goods, where a false trademark or service mark has been used, to provide the name and a ddress of the consignee of those goods and also the 
consigner and proceed further under the law to prohi bit the importation of such goods. Statistics on 
seizures by the Customs are not presently available.  As per the information, more than 2,000 cases 
were registered under the Copyrights Act from January 2005 to June 2005. This resulted in the arrest 
of over 2,000 alleged offenders and seizure of material valued over Rs. 93 million.   
  Currently India is examining th e changes that would be required in Indian laws to make them 
compatible with the provisions of the Internet Treaties. 
  The Trade Marks Act, 1999 does not make any distinction between physical trade and the on-line trade. The Act is applicable to all trad e carried out in India. These provisions are: 
 
♦ If any person  misappropriates a trade mark regist ered under the Trade Marks Act, 
1999 or uses the said false trade mark, the infringer shall be liable for civil and 
criminal action if the infringer service provider is located in India.  
♦ Section 29 of the Trademarks Act 1999 provides relief for infringement in respect of 
any trademark or service mark. The mechanism provided under section 29 is of a civil nature. These infringements are as below: 
 
o A registered trade mark is infringed by a pe rson who unauthorizedly uses in the course of 
trade a mark which is identical with or decep tively similar to the registered trade mark.  
o Section 29(5) provides that a registered trade mark  is also infringed by a person if he uses it in 
his business concern dealing in goods or services in respect of which it is registered.   
o Section 29(6) clarifies that a person uses a regist ered trade mark, if he uses it on his business 
paper or advertisement.   
 WT/TPR/M/182/Add.1 
Page 182  
 
  The above provisions provide adequate protec tion and provide for prosecuting a person for 
infringement of a trade mark.  
Criminal action can also be initiated against th e infringer. In case of criminal action, any 
person can file a complaint before a 1
st Class Judicial Magistrate or before a police official (not below 
the rank of DSP) to put the criminal law in motion,  which can result in the co nviction of an accused.   
  Certain trade mark offences have been r ecognized as a cognizable offence. These include 
penalty for applying false trade marks /trade description (Section 103); penalty for selling goods or providing services to which false trade marks/trad e description is apply (Section 104); enhanced 
penalty on second or subsequent convection. Infri ngement of copyrights in any manner is covered 
under Section 51 of the Copyright Act, 1957 subj ect to “fair dealing” exceptions provided under 
Section 52 thereof. Both civil and criminal remedies are available under the Indian law. 
 
India has  requisite legislation for collective management of copyrights. Presently,  four 
Copyright Societies are the registered in India: 
 
a. Society of copyright Regulation of India Producers for Film and Television (SCRIPT) 
135, Continental Building, Dr. A.B.Road, Worli, Mumbai-400 018, (For Cinematograph and Television Films) 
b. The Indian Performing Right Society Limited (IPRS), 108, Golden Chambers, 2
nd 
Floor, New Andheri Link Road, Andheri (W), Mumbai-400 058 (For musical works) 
c. Phonographic Performance Limited (PPL), Flame Proof Equipment Building, B-39. 
Off New Link Road, Andheri (W), Mumbai-400 058 (For Sound Recording) 
d. Indian Reprographic Rights Organization (IRRO) (For photocopy rights). 
 21. The Secretariat’s Summary Ob servations (WT/TPR/S/182 page vii) note that agricultural 
growth in India has remained slow and erratic, despite impressive overall economic performance 
with growth averaging over 8.5% since 2003/04. Th e low growth in the agricultural sector has 
occurred over a period when government suppor t for the sector has increased substantially.  
 
(i) How does the Indian Government promote stru ctural adjustment in the agricultural 
sector to allow for improvements in productivity and competitiveness? 
 
(ii) What policies does India have in place or in  prospect to address the “crowding out” of 
public investment in R&D and infrastructure by spending on direct and indirect subsidies, which the Secretariat’s report (page xi) identifies as a major factor in India’s 
low productivity in the agriculture sector? 
 
Reply: The growth in agriculture sector during 10
th Five Year Plan (2002-07) has been estimated to 
be 2.3%. The strategy to achieve 4% growth during 11th Five Year Plan (2007-2012) includes: 
 
(i) Accelerating the production and productivit y of major food crops on regionally 
differentiated basis. 
(ii) Development of rainfed and dry land areas through watershed management, more 
efficient water use and ground water recharge. 
(iii)  Revamp of agriculture extension system to im prove delivery       mechanism at the grass 
root level. 
(iv) Focus on farmers’ welfare through risk mitig ation, and better social security system. 
(v) Greater role for the Panchayati Raj Institutions.  
(vi) Input support to the resource poor, small and marginal farmers to improve their access to 
quality inputs and technology.  WT/TPR/M/182/Add.1 
 Page 183 
 
 
  (vii) Easy and timely availability of  institutional credits to farmers at a reasonable rate of 
interest. 
(viii) Agricultural marketing reforms to create post-harvest and marketing infrastructure, 
including grading, packaging, transportation and storage facilities.  
(ix) Thrust on improving quality of rural conn ectivity through programmes like Pradhan 
Mantri Gram Sadak Yojna (PMGSY). 
(x) Improving potential for irrigation through new projects and more efficient utilisation of 
water.  
  Other policy initiatives include sustainable and viable farming livelihood support systems 
especially in the distressed areas. In addition,  efforts are being made to expand the area under 
cultivation, to deal effectively with the soil hea lth issues, and to improve and control diseases in 
livestock and poultry.   The subsidies being given by India in agriculture  sector are mostly directed to the low-income 
and/or resource poor farmers and also to ensure fo od security particularly to the more vulnerable 
sections of the society. However, substantial im provement in public and private investment in 
agriculture research, technology and infrastructure is proposed during the 11
th Plan to improve 
productivity and growth in agriculture. 
 
22. We note (WT/TPR/S/182, page 106, paragraph 21) that India has established agri-export 
zones to encourage exports of certain products, and these zones receive assistance from central and 
state governments. Could India please provide furt her information on the specific measures taken?  
 
Reply: Agri-Export Zones (AEZs) were introduced thr ough the Export-Import Policy 2001-02 with 
the objective of developing and s ourcing raw materials and their processing and packaging in a 
contiguous area leading to final exports. Assistance  is provided to develop infrastructure, such as 
roads connecting production centres with ports, deve lopment of minor ports and jetties, setting up of 
inland container depots and container freight sta tions, augmentation of common facilities in existing 
zones, setting up of common effluent  treatment facilities, and stabi lizing power supplies.  Productivity 
enhancement, micro irrigation, research and de velopment, pre- and post-harvest training and 
extension services, maintenance of cold chains , and assistance towards market development and 
freight are also provided.  The details of  the AEZs are at http://www.apeda.com.  
 
23. We note (WT/TPR/S/182, page 10 8-9) that India provides, inter alia minimum support prices 
for 25 essential commodities, minimum intervention prices for other crops, input subsidies and 
consumer price subsidies  In its notifications to the WTO Committee on Agriculture, India has 
provided some general informati on on support provided to the rice, wheat and coarse c ereals sectors. 
Australia understands that domestic support is provid ed to the sugar sector, at both Central and State 
level. India has not recently notified any export s ubsidies to the WTO Co mmittee on Agriculture 
 Could India provide a description and details of the support arrangements pr ovided for the sugar 
sector, including the types of measures and expenditure, at both Central and State level?  
 Reply: The details of any support arrangements provide d for the sugar sector would be included in 
the requisite notifications.  
24. India has notifications pending for dom estic support (marketi ng years 1998/99 onwards) and 
export subsidies (marketing years 2001/02 onward s).  When does India plan to make these 
notifications and provide Members wi th an opportunity to review its domestic support and export 
subsidy arrangements for these years?   WT/TPR/M/182/Add.1 
Page 184  
 
  Reply: India notified its domestic support for the pe riod 1996-97 and 1997-98 and its export subsidies 
to the WTO for the period 1996-97 to 2000-01 in March 2002. The notification will be updated as 
soon as possible.  
 
25. In the context of the WTO Secretariat’s Repor t observation that “services have been the main 
engine of growth in recent years…largely due to greater progress in reform in certain services”, 
could India provide the trade policy rationale fo r not making offers in th e WTO General Agreement 
on Trade in Services negotiations which reflect the current market access and openness in those 
sectors, for example the financial and telecommunications services sectors? 
 
Reply:  Financial sector liberalization in India h as been calibrated on cautious and appropriate 
sequencing of reform measures and was marked by a gradual opening up of the economy.  Unlike 
other services, opening up financial services has far reaching implications from the point of view of 
both macroeconomic and financial stability among othe rs due to overlap betw een financial services 
and capital account liberalization.  
 
 The current binding commitments under GATs re flect the balance of rights and obligations 
existing at the end of the Uruguay Round. Taki ng further binding commitments on autonomous 
liberalization reduces policy space and would, therefore,  have to be calibrated vis a vis the benefits 
that India gets in response to its requests in th e different services sectors and modes, including in 
modes 1 and 4.  
 
26. On 28 February 2005 the Reserve Bank of India announced a more liberal approach to 
foreign banks entering India.  While foreign bank li censing procedures would con tinue as in the past, 
the number of branches permitted each year would be higher than the existing WTO commitment of 
12 branches in a year and that a more liberal po licy for under-banked areas of India would be 
followed.  
 (a) What is the current quota on the annual numb er of foreign bank branches approved?  Are 
foreign bank automatic teller machines included in  this quota?   How is an under-banked area in 
India defined?  What obl igations are placed on foreign banks seeking to establish branch networks in 
India, particularly in relation to under-banked areas? 
 Reply:  Our commitments to WTO are 12 licenses per y ear for both new and existing foreign banks. 
In terms of our WTO commitment, licences for new foreign banks may be denied when the maximum 
share of assets in India both on and off balance sh eet of foreign banks to total assets both on and off 
balance sheet of the banking system exceeds 15%.  
 
 India has been autonomously giving licenses in  excess of our commitment. Year-wise number 
of approvals given since the year 2000 is as under:  
Year
 No. of licences  
2000 --- 15 2001 --- 18 
2002 --- 16 2003 --- 18 2004 --- 17 2005 --- 13 
2006 --- 13 
  While considering applications for opening of new branches, weight is given to the banking 
facilities provided by the bank in under banked areas.     WT/TPR/M/182/Add.1 
 Page 185 
 
 
   The list of under-banked areas is given in Annex V to the Master Circular dated July 1, 2006 
on Branch Authorization Policy (full text available at www.rbi.org.in). This is subject to review. 
 
(b) Could India provide information on assistan ce measure to sugar expor ters at both Central 
and State level?  In particular, could India provid e full documentation on freight and other transport 
subsidies for export shipments of sugar, at both Central and State level?   
Reply:  The details of any support arrang ements provided for the sugar sector would be included in 
the requisite notifications. 
 
27. When is the Telecom Regulatory Authority of India likely to release the recommendations of 
its review of Internet services, initiated in 2006? Will these recommendations assist in clarifying the 
status of pending Internet service provider licence applications? 
 
Reply: The TRAI recommendations are being examined by the Department of Telecommunications. 
 
28. What is the Indian Department of Telecomm unications’ policy in respect of keeping licence 
applicants informed of progress with their applica tions, delays affecting processing, or the reasons 
for decisions? Is this policy inscribed in law?  
Reply: The  applicant  can  contact the concerned  unit/offi cers  to  get an update  on the status  of  
their  application. 
 
29. Has India implemented all or parts of the International Telecommunication Regulations (ITR-
88) in domestic legislation? If so, through which pi eces of legislation have they been implemented and 
where can these be obtained? 
 
Reply:  All the Acts/Rules are available on the DoT’s website www.dot.gov.in and on the website of 
the Telecom Regulatory Authority of India www.trai.gov.in .   
30. The Telecommunications Reference Paper re quires telecommunications interconnection to be 
provided at “cost-oriented rates that are transparent, reasonable, having regard to economic 
feasibility, and sufficiently unbundled so that the supplier need not pay for network components or 
facilities that it does not require for the service to be provided.” Does the price of international 
interconnection in India include elements not related  to interconnection costs? If so, please detail 
these. 
 Reply:  TRAI has laid down procedures to recommend interconnection charges. 
 
31. To what types of telecommunications enterprise does India apply foreign ownership 
limitations? Does India have a short term or long term strategy to reduce or eliminate foreign 
ownership limitations in the telecommunications sector?  
Reply:  The policy on the foreign ownership limitations in the telecommunications sector is reviewed 
by India from time to time.    
32. India is increasingly looki ng to improve the performance of its mining sector but the sector 
continues to be burdened with complex regulati ons that increase the transaction costs of mining 
companies, encourages corruption.  Specific detr iments include 77 agency approvals required to 
obtain a mineral license, absence of provisions for automatic conversion of an exploration permit to a 
mining lease, and the Mines Minister’s power to r evoke a mining lease without any explanation.  
Does India intend to address these issues and impl ement the Hoda Committee report reviewing the 
National Mineral Policy of India? WT/TPR/M/182/Add.1 
Page 186  
 
  Reply: The recommendations of the H oda Committee have been examined, and  a draft National 
Mineral Policy, 2007 based, inter alia, on the i nputs provided by the Hoda Committee Report, is 
presently under consideration of the Government.   JAPAN
 
 
(xi) Standards and other technical requirements 
 
(Question 8: page 52, paragraph 54)   
 1. Please explain the legal basis of and the services provided by the eigh t laboratories possessed 
by the BIS. 
 
Reply:  The BIS Act 1986, enacted by the Parliament of India, mandates that the Bureau of Indian 
Standards would establish, maintain and recognize la boratories for the purpose of standardization and 
Quality Control and for such other purposes as may be prescribed (Chapter IV, Clause 10 (1)h. 
Hyperlink : http://www.bis.org.in/bs/bisact.htm)   The BIS Rules 1987, published in the Gazette of  India, Extraordinary, 1 April 1987 prescribe 
the duties and services to be provided by established laboratories of BIS.  Hyperlink : 
http://www.bis.org.in/bs/index.htm     
(2) The Secretariat report describes that mo re than 60 licenses have been granted under the 
Foreign Manufacture’s Scheme in some 15 countries. 
 Please provide specific names of th e countries and licensed operators. 
 
Reply:  Presently, there are 65 licences which are under operation under the Foreign Manufacturers 
scheme of BIS. The details of licences granted by BIS is availabe at the BIS Website: www.bis.org.in.  
 
The Secretariat Report (WT/TPR/S/182) 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE 
 
(2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 (Question 4: page 33, 38, 41, paragraph 1, 2, 23, 28)  
 
While India’s average applied rate on non-agricultu ral products in 2006/2007 is 12.1% as a result of 
the tariff reductions, the average bound rate for non-agr icultural products is 34.7%. In addition to the 
discrepancy between the applied and bound rates,  low binding coverage for non-agricultural 
products (71.6%) is not predictable. In terms of p redictability, it is favorable to reduce as much as 
possible the discrepancy between the applied and bound rates, as well as to increase the coverage. 
 
The Secretariat report states that the tariff on non-agri cultural products has been cut to meet India’s 
goal of achieving ASEAN levels of tariff protec tion for non-agricultural products by 2009.  
 
Japan would like to know what ‘ASEAN levels’ mean,  as well as the tariff reduction schedule in the 
hereafter. 
 
Reply: ASEAN levels mean the average levels prev ailing in the ASEAN countries.  The current 
average applied rate for non-agricultural products is  now around 9.5%.  It is not possible to indicate  WT/TPR/M/182/Add.1 
 Page 187 
 
 
  the time schedule for further reduction, if any, on  non-agricultural products.  It is not possible to 
predict future policy decisions.  (Question 5: page 34, paragraph 8)    Imposing central sales tax merely on the transportati on of goods from one st ate to another could 
hamper the free business environment in India.  
 
Please explain the rationale for and the purpose of this tax. 
 
Reply:  The basic philosophy followed in the taxation of ‘sale of goods’ is that ‘sale of goods’ should 
be taxed in the state in which the goods are sold fi nally for consumption. CST, on the contrary, is a 
tax that is levied in the originating state and is  against the destination principle. CST however was 
considered necessary for regulating inter-state trade for providing a minimum incentive to the 
originating state to administer the system of tracking each inter state sale to a valid registered dealer in 
the destination state so that the normal sales tax c ould be collected in the destination state and tax 
evasion could be prevented.  
 
 Now the process of phasing out of CST has commenced since CST is inconsistent with 
destination based Value Added Tax (VAT). Regarding issue of tracking of inter-state trade, the same 
is now proposed to be done by building a system of online information exchange between states. A 
project called Tax Information Exchange (TINXSYS ) is under implementation in this context.  
 (ii) Customs valuation and clearance  (Question 6: page 36, paragraph 16)  
 
(1) The Secretariat report touches upon the amendmen t of Rule 9(2) of the Customs Valuation 
Rules 1988. 
Please provide specific information on how the Rule  9(2) of the Customs Valuation Rules 1988 was 
changed. 
Reply: Amendment to Rule 9 (2) of the Customs Valua tions Rules, 1988 was made vide Notification 
No.6/2004-Customs (N.T.) dt. 19.01.2004.  This ame ndment clarifies that the cost of freight incurred 
in the movement of container from the port of en try to the Inland Container Depot or Container 
Freight Station shall not be included in the cost of transport. 
 
(2) Please clarify whether the landing fee, which is about 1 per cent of the Cost, Insurance and 
Freight (CIF) value, is included in the tax base of the customs tariff in India. 
Reply:  As per Rule 9(2) of the Customs Valuation (D etermination of Price of Imported Goods) Rules, 
1988 the loading, unloading and handling charges ass ociated with the delivery of the imported goods 
at the place of importation will be includ ed in the value of imported goods.  
 
(vi) Other charges affecting imports  
(a) Tariff structure 
 (Question 7: page 44, paragraph 34) 
 
(1) Please confirm that it is right to understand th at the countervailing duty, which consists of the 
additional duty and the special add itional duty, and the education- cess would be levied on imported 
articles in addition to the basic custom tariff. Is  there any other duty on imported articles in addition WT/TPR/M/182/Add.1 
Page 188  
 
  to them? Please provide information on duties which have already been eliminated among those 
duties. 
 Reply: The answer is in the affirmative for the first pa rt of the question.  There is no other duty.  
These duties continue to be in force.  (2) Please provide detailed information on tho se duties, such as the countervailing duty (the 
additional duty and the special additional duty) and the education-cess, and especially information on the background, objective, legal basis, governing au thority and procedures relevant to those duties 
respectively.   
Reply:  Additional duty is charged at rate equal to central excise duty (CENVAT).  Special additional 
duty is charged at 4%.  These are levied under section 3 of the Customs Tariff Act.  Education cess is 
charged at 3% of the aggregate duties in terms of provisions in the Finance Act. 
 (3) Please confirm that it is right to understand that all duties, other than the basic custom tariff 
and the countervailing duty, are categorized as the internal taxes in India. If some duties are 
categorized as customs tariffs , please specify these duties. 
 
Reply: Countervailing duty is categorized as internal tax.  Education cess of customs is not an internal 
tax and is to be treated as tariff.    
 
(b) Additional Duty 
 
(1) Please clarify what kind of imported articles are subject to the additional duty.  
Reply:  All goods are liable to additional duty at ra tes equal to the CENVAT rate on those goods. 
(2) The Secretariat report states the additional  duty is in lieu of the excise duty. 
 
Please clarify whether the differen ce in the tax rates between the additional duty and the excise duty 
exists. If the rates are different,  please indicate the respective rate s of the additional duty, which are 
applied to imported goods.  
Reply:  Additional duty is charged at the same rate or at a rate lower than the CENVAT rate on 
imported goods.  
(3) Please confirm that it is right to understand that the tax base of the additional duty is the total 
amount of assessable  value of imported goods and its basic customs duty. 
Reply:  Confirmed. 
 (4) Regarding the imports of raw materials and intermediate goods, would the additional duty 
imposed on them be eligible for tax refund when they are used as inputs in the production of a finished product, which is subject to the excise duty?  Please clarify whether both cases exist in which 
the additional duty would be eligible for tax refund and not eligible for tax refund. If yes, please 
provide information in which cases the tax refund would be available.  
Reply:  The additional duty can be taken as credit and can  be used for payment of excise duty. There 
is no scheme for refund in cash.    (5) Please provide India’s view on the consiste ncy of additional duty with the WTO agreement, 
especially in terms of paragraph 1 of Article II and paragraph 2 of Article  III of the GATT 1947.  WT/TPR/M/182/Add.1 
 Page 189 
 
 
  Reply: This is clearly permitted under Article III as the a dditional duty is charged at rates equal to or 
lower than the excise duty.   (6) Please clarify what kind of imported goods are subject to the special excise duty. 
 
Reply: There is no special excise duty. 
 
(7) Please provide information on the rate of the special excise duty. If th e rate varies according 
to imported goods, please indicate the respecti ve rates which are applied to imported goods. 
 Reply: Not applicable. 
 
(8) Please indicate the tax ba se of the special excise duty. 
 Reply: Not applicable. 
 (c) Special Additional Duty  (1) Please clarify what kind of imported goods are subject to the special additional duty. 
 Reply: Except for a few exceptions, all goods which are subject to State VAT/Sales tax are subject to 
special additional duty. 
 
(2) Japan understands that the rate of the special additional duty is 4%. If this rate varies 
according to imported goods, please indicate th e respective rates, which are applied to respective 
imported goods.  
Reply: The general rate for special additional duty is  4%.   However, goods which are exempt from 
VAT are also exempt from special additional duty.   Besides, a number of items like fertilizers, 
petroleum products, power project equi pments, are exempt from this duty.  
 
(3) If the special additional duty is categorized  as an internal duty rather than a customs duty, 
please specify what kind of internal tax is supposed  to be countervailed by the special additional duty. 
 
Reply: Special additional duty of customs, commonly known as special CVD, has been levied on 
imported goods to counter balance the internal taxes such as sales tax, value added tax, local tax or 
any other charges leviable on a like article on its sale, purchase or transportation in India.   The intention of the Government is to safegua rd the interests of indigenous industry, which 
suffers from various taxes levied and collected by th e States and levy of special CVD is to counter the 
impact of such taxes.  To illustrate, taxes levied  on such goods by variou s agencies other than the 
Central Government are: 
(a) CST on inputs procured from other States. 
(b) CST on products sold in other States. 
(c) Octroi levied by Municipalities on entry of goods. The rate of octroi varies from 2.5% 
to 5.5%. This is applicable on in puts needed by the industry also. 
(d) Electricity duty levied by the State Governments on consumption/sale of electricity, 
which is one of the inputs for manufacture of  goods. Rate of electricity duty varies 
from State to State. 
(e) Sales tax on petrol/diesel – No credit. 
  These taxes are in addition to general St ate VAT which varies between 4% - 12.5%.  WT/TPR/M/182/Add.1 
Page 190  
 
   In India, no set-off is available for the CST on inputs, octroi on inputs, electricity duty and 
sales tax paid on auto fuels.  The sum of these in ternal taxes depends upon th e location of an industry 
and type of goods it manufactures. Special additi onal duty is charged only at 4%, which is the 
minimum rate. The incidence of internal taxes a nd other internal charges borne on domestic products 
are much higher than the Special CVD rate of 4%.  
 
(4) Please confirm that it is right to understand t hat the tax base of the special additional duty is 
the total amount of accessable value of imported goo ds, its basic customs duty and its additional duty. 
 
Reply: Confirmed. 
 
(5) Please provide India’s view on the consistency of the special additional duty with the WTO 
agreement, especially in terms of paragraph 1 of  Article II and paragraph 2 of Article III of GATT 
1947. 
 Reply: Special additional duty on imported products is not  inconsistent with the provisions of the 
WTO agreement. Paragraph 2 of Article II read with  paragraph 2 of Article III of GATT 1947 permits 
imposition on imported products of a charge equivalent to internal taxes or other internal charges 
applied, directly or indirectly , to like domestic products.  
 
(d) Education Cess 
 (1) Japan understands that the education-cess is also  levied on imported goods in addition to the 
basic customs duty, the additional duty, and the special additional duty.  
 Please clarify what kind of imported goo ds are subject to the education-cess. 
 Reply: All imported goods are subject to education cess, unless specifically exempted. 
 
(2) Japan understands the rate of the education-cess is 3%. If this rate varies according to 
imported goods, please indicate the respective rates,  which are applied to respective imported goods. 
 Reply: The rate is uniform at 3% of the aggregate of duties of customs. 
 
(3) Please explain why the education-cess is applied twice to only imported goods along with its 
legal basis. 
 
Reply: There is an excise education cess of 3% on domestic goods, which also applies to imported 
goods by way of additional duty.  The 3% education cess of customs is in the nature of a tariff.  There 
is no double duty. 
(4) Please confirm that it is right to understand t hat the tax base of the education-cess is the total 
amount of the basic customs duty, the additional duty and the special additional duty.  
Reply: Confirmed with the modification that special a dditional duty is not included for determining 
the tax base for education cess of customs.  (5) Please provide India’s view on the cons istency of the education-cess with the WTO 
agreement, especially in terms of paragraph 1 of  Article II and paragraph 2 of Article III of GATT 
1947. 
 Reply: So far as education cess of customs is concerned, it is in the nature of a tariff and is consistent 
with the WTO obligations so long as the tariff pl us the customs education cess does not exceed the  WT/TPR/M/182/Add.1 
 Page 191 
 
 
  bound rates.  As regards education cess of exci se, it applies to all domestic goods and therefore 
imported goods can also be subjected to  same internal taxes under Article III. 
 
(3) M EASURES DIRECTLY AFFECTING EXPORTS  
 (ii) Quality control and preshipment inspection 
 
(Question 9: page 61, paragraph 83)  
 
It is informed that India has introduced expor t tax measures on iron ore (about 7US$ per ton) and 
chromium ore (about 45US$ per ton) since March 1
st, 2007.  
 
Japan would like to know the details of the meas ures and the reason why India has introduced the 
measures. 
 Reply: Export taxes are not prohibited by the WTO.  E xport cess has been levied on iron ore in 2007 
budget with a view to conserve natural resources and raise revenue. Export duty was imposed on iron 
ores and concentrates @ Rs. 300 per tonne and on ch romium ores and concentrates @ 2000 per tonne 
in the Budget for 2007-08. However, vide notifi cation No. 62/2007-Customs, dt. 3.5.2007, export 
duty on iron ore fines of Fe content 62% and below has been reduced form Rs. 300 per tonne to Rs. 
50 per tonne. (may be viewed at www.cbec.gov.in)  
 (4) M
EASURES AFFECTING PRODUCTION AND TRADE  
 
(ii) Taxation and non-tax assistance 
 
(Question 10: page 76, paragraph 126) 
 According to this paragraph and its relevant footnote  of the Secretariat Report, corporate tax for 
foreign branches amounts to 41.82%, whereas that for India’s domestic company amounts to 30%. 
Both domestic companies and foreign branches partici pate in Indian economic activities in a similar 
fashion and should be dealt without distinction.   
 
Please provide the details of the measures and th e reason why India has introduced the measures. 
 
Reply:  
(i) Domestic companies are taxed on their gl obal income, whereas foreign companies are 
taxable only on their Indian source income.  Fu rther, foreign companies are eligible to 
claim benefits under the Double Taxation A voidance Agreements, the terms of which 
may be more beneficial than the provisions of domestic law.  
(ii) A domestic company is liable to pay Divide nd distribution tax (DDT) at the rate of 
15% (exclusive of surcharge and educati on cess), whereas a foreign company is not 
liable to pay such tax in India.  
(iii) The rate of surcharge for domestic companies is higher at   10% as against 2.5% for 
foreign companies.  
(iv) Foreign companies enjoy special concessiona ry rates on certain specified incomes, 
which are taxed on gross basis, under different provisions of the Income-tax Act, including:    WT/TPR/M/182/Add.1 
Page 192  
 
  ¾ Royalty or fees for technical services received from Government or any Indian 
concern under an agreement entered into on or after the 1
st day of June, 2005 
(10%) 
¾ Interest on bonds of Indian company issued under a notified scheme or bonds of 
public sector company sold by Government and purchased in foreign currency 
(10%) 
¾ Dividends on Global Depository Receipts (10%)  
 
Price controls 
 
(Question 11: page 80, paragraph 140)   
(1) Japan would like to know related information on the background and objectives of the 
Maximum Retail Price (MRP) Scheme.  
Reply: The MRP based levy was introduced with a view  to reduce valuation disputes.  Under the 
provisions of Standards of Weights and Measures Act, 1976, as a measure of consumer protection, 
packaged items, inter alia, are required to indicate the maximum retail price.  Since this price is 
known, for certain specified items prone to valuat ion disputes, Government had provided that for 
these items the tax base would be the MRP subject, however, to certain abatements from the MRP. 
 (2) Please clarify what kind of imported articl es are subject to the M RP scheme. Please explain 
why those specific articles are subject to the MRP.  
Reply: All goods, which are subject to excise duty under the MRP based scheme, are liable to pay 
additional duty on the basis of MRP. This provision is only for goods that are required to contain a 
declaration of MRP under the Standards of Wei ghts and Measures Act, 1976 or any other law. 
 
(3) In which case would the additional duty be calculated based on the MRP as its tax base? 
Please clarify what kind of imported articles are subject to this scheme. 
 Reply: The tax base is the MRP but with some abatements notified by the Government. 
 
(4) When the imported article is actually sold in India at the lower retail price than the MRP 
decided to pay the additional duty, would the overpaid amount of the additional duty be refunded? 
 
Reply: No refund is admissible. This is also true fo r domestic goods, which are sold in the market 
below the MRP.  (iv) Information technology (IT)  
(Question 18: page 125, paragraph 86)   
 
(1) According to the Secretariat report, India has eliminated all the specified 217 tariff lines 
since 1 March 2005 as a member of the Informa tion Technology Agreement (ITA). However, India 
still levies duties, such as the special additiona l duty and the education-cess on certain IT products, 
which are subject to the ITA.   
 Please provide India’s view on the consistency of imposing such duties with the ITA. 
 
Reply: 4% special additional duty is not a tariff.  The rationale for this has already been explained 
above.  WT/TPR/M/182/Add.1 
 Page 193 
 
 
  (2) Japan understands that India levies bank guar antee (10%) on the importation of any kind of 
digital camera, which should be treated as the ITA product for more than two years, and it substantially works as a custom duty.  
 
Please provide India’s view on the consistency of  such bank guarantees with the ITA. Japan would 
like to know when India intends to eliminate such bank guarantee systems. 
 Reply:  As per Customs notification No. 25/2005-Custom s dated 01.03.2005 Sl. No. 13, (available in 
the website www.cbec.gov.in.) ‘digital still image vi deo camera’ falling under tariff entry 8525 80 20 
are exempt from the whole of basic Customs Duty. All digital cameras do not fall under the entry 
specified above. The Bank Guarantee is taken to pr otect duty involved whenever the importers are not 
able to satisfy the product’s eligibilit y for exemption under the notification. 
 
(v) Transport  
 
(Question 29: page 141, paragraph 146) 
 The Secretariat report states, "In 1977 and a Tariff Aut hority of Major Port (TAMP) was established 
to regulate tariffs for all major ports; non-ma jor ports are administered by respective state 
governments."  
Japan believes that Freight Tax (Income Tax) is  exempted reciprocally under the bilateral tax 
agreement between India and Japan. At Haldia Port  and Paradip Port in Eastern India, which are 
two of 12 major ports in India, however, there a re many cases in which a taxman tries to impose 
Freight Tax if the taxman finds that a vessel is  registered in other countries (e.g. Panama) which 
India does not conclude such a tax agreement but is owned by a Japanese shipping company. In such 
cases, if the shipping company submits additional do cuments requested by the taxman, the payment 
will be exempt; yet such a situation has not occurred in the other ports in India.  
 
Please explain why such unreasonable practi ces are undertaken at those two ports. 
 
Reply: The observations are  not clear. No particular example has been given. The Government has 
not received any complaint of any unreasonable practice. However, in terms of Article 8(2) of Indo-
Japan Double Taxation Avoidance Agreement, profit s from the operation of ships in international 
traffic carried on by an enterprise of a Contracti ng State shall be taxable only in that Contracting 
State. The term ‘’enterprise of a Contracting State’  means an enterprise carried on by a resident of a 
Contracting State. Accordingly, it is necessary fo r the Assessing Officer (Taxman) to determine the 
tax residency of the claimant. For that purpose, the Assessing Officer is justified in asking for all the 
relevant documents. 
 
(Question 3: page 30, paragraph 146) 
 
According to the Government report, “The Cu stoms Act empowers the Central Government to 
prohibit or restrict import or export of goods in or der to protect trademarks, copyrights and patents.” 
 1. As for the protection of "Trademark", please cl arify whether the protection is limited to the 
trademark registered under the Trademark Law, or whether the Central Government can 
prohibit or restrict import or export of goods to protect an unregistered trademark and 
indications other than the registered trademark. 
 2. If the latter is the case, please clarify a sp ecial requirement to protect an unregistered 
trademark and indications other than the registered trademark.  
 WT/TPR/M/182/Add.1 
Page 194  
 
  Reply:  The protection extends only in respect of infringement of trade marks registered under the 
Trade Marks Act, 1999.   
(v) Intellectual property rights 
 
(Question 12: page 84, paragraph 153)   
 In order to facilitate the technological transfer by utilizing intellectual property rights, Japan finds it 
desirable to remit the royalty of intell ectual property rights to abroad freely. 
 
(1) Please indicate whether India has specific  regulations on such remittance of royalty. 
 (2) If yes, please provide any plan to dere gulate such legislation in the future. 
 
Reply to Qs 1 and 2: Determination of royalty is a commercia l decision between the two parties. Any 
dispute relating to reasonableness of royalty can be brought to court for settlement. 
 
With the latest revision of the Indian Patents Act in 2005, Section 2(1) (ta) was introduced which sets 
forth that “(ta) “pharmaceutical substance” means  any new entity involving one or more inventive 
steps.” The requirement of an inventive step is  a general requirement applicable not only to 
pharmaceutical substances.   
 
Please explain why India introduced this provisi on to define "pharmaceutical substance" by using 
"inventive steps". Please indicate  whether there are any differences in patent protection conditions 
applicable to pharmaceutical substance-related inventi ons and to other substances-related inventions. 
 
(2) With the latest revision of the Indian Patents Act in 2005, a condition was added to the Indian 
Patents Act which goes as follows: “the mere disc overy of a new form of a known substance which 
does not result in the enhancement of the known efficacy of that substance….” 
 Please indicate whether there is any criterion app licable to the difference between a mere discovery 
(that is unpatentable) and a patentable invention. 
 
(3) Section 3(d) includes the following explanati on; “For the purposes of this clause, salts, 
esters, ethers, polymorphs, metabolites, pure form, particle size, isomers, mixtures of isomers, complexes, combinations and other derivatives of know n substance shall be considered to be the same 
substance, unless they differ significantly in  properties with regard to efficacy.”   
 
Please explain why this explanation was added to Section 3(d).  Is there any criterion applicable to the enhancement of a known efficacy of a known substance? If 
there are any criteria applicable to the conditions me ntioned above, please provide this information. 
 
(4) Section 64 sets out provisions on revocation of  a patent by the Appellate Board. Section 66 
stipulates that “Where the Central Government is  of opinion that a patent” “is” “generally 
prejudicial to the public,” “the patent shall be deemed to be revoked.” Section 85 allows the 
Controller to revoke a patent on the ground of non-working. Under Section 117A, an appeal can be filed in any of these cases described in Sections 66 or 85. 
 
Is there an opportunity for a judicial review of a d ecision to revoke or forfeit a patent in any of these 
cases described in Sections 64, 66, or 85 (Article 32 of the TRIPS agreement)? 
  WT/TPR/M/182/Add.1 
 Page 195 
 
 
  Reply to Qs 2, 3 and 4: India follows the global norms for dete rmining patentability, i.e., novelty, 
inventive step and industrial applicability. This defini tion has been used particularly to ensure that no 
frivolous patent is granted and ever-greening of the patent is prevented. Pharmaceutical products 
formed 89% (7953) of the total (8926) mail-box a pplications filed during the period 1.1.1995 to 
31.12.2005. 
 
 Discovery is not considered patentable. To be patentable, an invention should have an 
intellectual contribution. Section 3(d) prevents gran t of frivolous patents for new forms or new usages 
of known substances.  Section 3(d) lawfully incor porates safeguards by strictly defining standards of 
patentability for pharmaceutical products so as to excl ude minor variations of existing medicines that 
do not add significantly to therapeutic efficacy.    
  Explanation to section 3(d) has been added to prevent ever-greening of the patent. The 
Explanation clearly differentiates between the disco very of a new form of the known substance and 
the known form of the substance. To qualify for patentability, the new form of the known substance 
should differ significantly in properties with regard to known efficacy. 
  A fast track mechanism for appeals has been provided by setting up the Intellectual Property Appellate Board (IPAB). IPAB for patents has been made fully operational with effect from April 2, 
2007 with the appointment of Technical Member. A ppeals against the decisions of the Appellate 
Board and of the High Court under section 64 lie with  High Courts and Supreme Court respectively. 
Appeal against the order of the Central Government  for revocation of the pa tent under section 66 lies 
with IPAB. Appeal against the decision of th e Controller under section 85 to revoke a patent on 
account of non-working lies with IPAB.  
(Question 14: page 91, paragraph 182)   
 
According to the Secretariat Report, “there is no spec ific legislation regulating the protection of trade 
secrets or enforcement measu res/penalties for violation of trade secrets” in India. 
 (1) This paragraph also menti ons, “Aggrieved parties can seek action through the Civil Court.”  
 
Although there is no specific legislation, please explain how a victim, who is aggrieved from 
acquisition or disclosure of information by measures in unfair business practi ce, seeks redress. If yes, 
please indicate what kind of system and legal basis on which such redress is based.  (2) In relation to the above (1 ), are there any relevant common la ws or case laws for protection 
against acquisition or disclosure of trade secrets by  measures in unfair business practice in India? 
Please indicate the outlines and ground s for the judgment of major cases. 
 (3) Are there any specific provisions or means to identify and protect the secrecy of trade secrets 
presented by the parties before the court in th e civil procedures under the Law of India? 
 
(4) Please indicate whether the criminal proce dures and penalties would be applied in cases of 
disclosure, acquirement or use by a third party without the consent of legitimate holders of Undisclosed Information. If yes, please indicate  the names or titles, and the outlines of the criminal 
procedures and penalties of the law.  
(5) Please indicate any plan to prepare any kind of domestic laws for civil and (or) criminal 
protection of trade secrets hereafter. If yes,  please indicate the outlines of its laws. 
 WT/TPR/M/182/Add.1 
Page 196  
 
  (Question 15: page 91, paragraph 185) 
 
According to the Secretariat report, “the poli ce also have ex officio powers under the Trade Marks 
Act, 1999, which permits any police officer not below the rank of deputy superintendent of police or 
equivalent, to search and seize without warrant the goods, die, block, machine, plate, and other 
instruments or goods suspected of infringing intell ectual property.  However,  the police officer must 
obtain the opinion of the Registrar before any search and seizure.”   (6) Please indicate whether the Indian Governme nt has the ex officio power to prosecute under 
the Trade Marks Act, 1999, in addition to the ex officio powers for the police to search and seize 
without warrant the goods, die, block, machine, plate, and other instruments or goods suspected of 
infringing intellectual property. If yes, please cl arify whether the prosecutor conducts such power.  
 
Reply to Qs 1, 2, 3, 4, 5, and 6:  Action for infringement of trademark can be initiated either by the 
owner of the trademark or by the Registrar of Trademarks.  
 
 The cognizable offences for which a Deputy S uperintendent of Police (DSP) level police 
officer has the power to search and seize the goods, dies and other instruments without warrant are 
limited to the following:  
♦ Penalty for applying false trade marks,  trade description etc. ( Section 103) 
 
♦ Penalty for selling goods or providing services  to which false trade marks or false 
trade description is applied ( Section 104)  
 
♦ Enhanced penalty on second or sub sequent conviction (Section 105) 
 
(2) Japan would like to be informed of the ex officio powers of search, seizure and prosecution 
under intellectual property Laws such as the Patent Law, Design Law and Copyright Law.  
  
(3) While the Secretariat report describes “the  police also have ex officio powers under the 
Trade Marks Act, 1999, which permits any police offi cer not below the rank of deputy superintendent 
of police or equivalent, to search and seize without warrant the goods, die, block, machine, plate, and other instruments or goods suspected of infringing intellectual property, the report points out, “the 
police officer must obtain the opinion of the Registrar before any search and seizure.” Both 
descriptions look controversial in terms of the ex officio power to the police (the police has power to 
search and seize, while the pr osecutor excises power to sea rch, seize and prosecute). 
 
Reply to Qs 2 and 3: Action for infringement of trademark can be initiated either by the owner of the 
trademark or by the Registrar of Trademarks.  
 
 Section 115 of the Trademarks Act provides th e powers to a police officer to take cognizance 
of the offences committed under the Trade Marks Ac t.  Under section 115(4) of the Act, a police 
officer not below the rank of DSP, if he is satisfi ed that any offence u/s 103 to 105 has been or is 
being or is likely to be committed, can search  and seize the offended goods, after obtaining the 
opinion from the Registrar of Trademarks and ther efore can set criminal law in motion as per the 
procedure prescribed for commission of cognizable offences under the Criminal Procedure Code and 
prosecute the same before the Competent Judicial Magistrate.     The cognizable offences for which a Deputy S uperintendent of Police (DSP) level police 
officer has the power to search and seize the goods, dies and other instruments without warrant are 
limited to the following:  WT/TPR/M/182/Add.1 
 Page 197 
 
 
   
(1) Penalty for applying false trade marks,  trade description etc. ( Section 103) 
(2) Penalty for selling goods or providing services  to which false trade marks or false 
trade description is applied ( Section 104)  
(3) Enhanced penalty on second or sub sequent conviction (Section 105) 
 
There is no provision empowering the prosecutor to exercise the powers of search and seizure 
of goods.  
(4) Please explain the specific rea son why the police officer in India must obtain the opinion of 
the Register before any search and seizure, while th e Japanese legislation grants the ex officio power 
of search, seizure and prosecution to the police. 
 
Reply: The Trade Marks Act, 1999, provides for both civil and criminal remedies for infringement of 
trade marks. To initiate civil acti on, suit for infringement should be instituted before the appropriate 
District Court. With respect to criminal action, the complainant has to lo dge a police complaint and 
set the criminal law in motion.  
 
(Question 16: page 92, paragraph 187) 
 
The Secretariat report explains, “There is a growing rea lization of the need to sensitize the judiciary 
on the role of IPRs and the impact of IP viol ations on the economic climate, and creativity and 
innovation, including through seminars for the judiciary.” 
 Japan would like to be informed of the average term  of trial in Civil and Criminal judgments on IPRs 
matters, as well as detailed information on the burden of proof by the plaintiff.  
 Reply: Civil suits and Criminal proceedings are being ca rried out in courts all over the country. The 
average time taken for the disposal of a civil suit a nd/ criminal proceeding relating to IPRs only, is not 
available. Information relating to the burden of proo f in different IPR legislation is provided in the 
relevant legislation.    
According to the Government report, “The Cu stoms Act empowers the Central Government to 
prohibit or restrict import or export of goods in or der to protect trademarks, copyrights and patents.” 
 (1) As for the protection of “Trademark”, please cl arify whether the protection is limited to the 
trademark registered under the Trademark law, or whether the Central Government can 
prohibit or restrict import or export of goods to protect an unregistered trademark and 
indications other than the registered trademark. 
 (2) If the latter is the case, please clarify a sp ecial requirement to protect an unregistered 
trademark and indications other than the registered trademark. 
 
Reply: The protection extends only in respect of infringement of registered trade mark under the 
Trade Marks Act, 1999.   
Japan would like to be informed of the detailed structure of the legislation.   
 
Reply: The Trade Marks Act, 1999 provides for both civ il and criminal remedi es for infringement of 
trade marks. To initiate civil acti on, suit for infringement should be instituted before the appropriate 
District Court. With respect to criminal action, the complainant has to lo dge a police complaint and 
set the criminal law in motion.   WT/TPR/M/182/Add.1 
Page 198  
 
  (3) Please explain the specific reas on why the police officer in India must obtain the opinion of 
the Registrar before any search and seizure, while the Japanese legislation grants the ex officio 
power of search, seizure and pr osecution to the police. 
 
Reply:  Infringement of trade mark has several technical nuances with which the Register of Trade 
Marks is familiar. Hence, in order to ensure that there is no unnecessary harassment and only in 
genuine cases search and seizure is carried out by th e police, it has been mandated that the opinion of 
the Registrar of Trade Marks be obtained prior to such search and seizure.  
 
(ii) Commitments under the General Agreement on Trade in Services 
 (Question 19: page 127 paragraph 91)   
 
In paragraph 7(8) of the Indian Foreign Exc hange Management Regulations, 2000 stipulates, 
"A national of a foreign state resident in India being an employee of a foreign company …may…, 
hold…a foreign currency account with a bank outsid e India and receive the salary payable to him for 
the services rendered to the office/branch/subsidia ry/joint venture in India of such foreign company 
by credit to such account:  
provided that, the amount to be credited to such  account shall not exceed 75 percent of the salary 
accrued to or received by such p erson from the foreign company."  
 
Please indicate the position of the Indian Government to the consistency of this regulation with the 
GATS agreement.  
Reply: Opening of a foreign currency account outside India is categorized as a Capital Account 
transaction in terms of Schedule 1 to Foreign Exch ange Management (Permi ssible Capital Account 
Transactions) Regulations  2000.  
 The Capital account Regulations do not allow th e persons resident in India to open foreign 
currency accounts outside India, except to the exte nt specifically permitted by the Reserve Bank.  
  Therefore, foreign nationals who are deputed to work in their affiliate/subsidiary in India, are 
required to comply with the provisions of FEMA re gulations. However, as a measure to deal with 
their specific requirements (of maintaining their family abroad or meet their commitments  on 
account of social security obligations, etc) they are permitted to  credit up to  75 per cent of the salary 
accrued to or received by them from the foreign company  in a bank account  outside India. These persons can also avail of the option of remitting of ne t salary (net of taxes) or USD 100, 000  per year 
per recipient in other cases  for main tenance of close relatives abroad. 
  The provision cited only regulates the amount wh ich can be maintained in a foreign currency 
account outside India (a capital account transaction)   and does not restrict the facility to the person to 
make a remittance for current account transactions. As such, the provision is consistent with our 
commitments under GATS.    (iii) Financial services  (Question 20: page 128, paragraph 94) (RBI) 
 
(1) Please elaborate on the policy objective to maintain public sector banks (PSBs) 
 
Reply: The policy objectives are to meet  progressively, an d  serve better,  the needs  of  development 
of the economy in conformity with national policy and objectives and for matters connected therewith 
or incidental thereto.  WT/TPR/M/182/Add.1 
 Page 199 
 
 
  (2) Could India indicate any plan to privatize these public sector banks? 
 
Reply:  There are no plans as of now to privatize the public sector banks. 
 
(iv) Information technology (IT) 
 
(Question 18: page 125, paragraph 86)   
 
(1) According to the Secretariat report, India has eliminated all the specified 217 tariff lines 
since 1 March 2005 as a member of the Informa tion Technology Agreement (ITA). However, India 
still levies duties, such as the special additiona l duty and the education-cess on certain IT products, 
which are subject to the ITA.    
Please provide India’s view on the consistency of imposing such duties with the ITA. 
 (2) Japan understands that India levies bank guar antee (10%) on the importation of any kind of 
digital camera which should be treated as the ITA product for more than two years, and it 
substantially works as a custom duty.   
Please provide India’s view on the consistency of  such bank guarantees with the ITA. Japan would 
like to know when India intends to eliminate such bank guarantee systems.  
Reply:  (1) Special additional duty of customs, commonly known as special countervailing duty 
(CVD), at the rate of 4% has been levied on importe d goods to counter balance the internal taxes such 
as sales tax, value added tax, local tax or any ot her charges leviable on a like article on its sale, 
purchase or transportation in India. 
 
 The intention of the Government is to safegua rd the interest of indigenous industry, which 
suffers from various taxes levied and collected by th e States and levy of special CVD is to counter the 
impact of such taxes.  To illustrate, taxes levied  on such goods by variou s agencies other than the 
Central Government are: 
(f) CST on inputs procured from other States. 
(g) CST on products sold in other States. 
(h) Octroi levied by Municipalities on entry of goods. The rate of octroi varies from 2.5% 
to 5.5%. This is applicable on in puts needed by the industry also. 
(i) Electricity duty levied by the State Governments on consumption/sale of electricity, 
which is one of the inputs for manufacture of  goods. Rate of electricity duty varies 
from State to State. 
(j) Sales tax on petrol/diesel – No credit. 
 
 In India, no set-off is available for the CST on inputs, octroi on inputs, electricity duty and 
sales tax paid on auto fuels.  The sum of these in ternal taxes depends upon the location of an industry 
and type of goods it manufactures. Special additi onal duty is charged only at 4%, which is the 
minimum rate, and in fact, if we were to give a real national treatment, we should charge special 
CVD at a much higher rate.   Education cess of customs which is in the nature of a tariff is levied at the rate of 3%.  An 
equivalent education cess of excise, is applicable to all domestic goods. 
 Therefore both the special additional duty and th e education cess are consistent with India’s 
obligations under the WTO.  WT/TPR/M/182/Add.1 
Page 200  
 
  (2) As per Customs notification no. 25/2005-Cust oms dated 01.03.2005 Sl. No. 13, (available in 
the website www.cbec.gov.in.) ‘digital still image vi deo camera’ falling under tariff entry 8525 80 20 
is exempt from the whole of basic Customs Duty. All digital cameras do not fall under the entry 
specified above.  A Bank Guarantee is taken to pr otect the duty involved whenever the importers are 
not able to satisfy the product’s eligib ility for exemption under the notification. 
 
29. Regarding freight tax 
 Japan believes that Freight Tax (Income Tax) is exempted reciprocally under the Bilateral Tax 
Agreement between India and Japan.  At Haldia Port  and Paradip Port in Eastern India, which are 
two of 12 Major Ports in India, however, there ar e many cases in which a taxman tries to impose 
freight tax if the taxman finds that a vessel is registered in other countries (e.g. Panama) which India 
does not conclude such a tax agreement but is owned by a Japanese Shipping Company.  In such 
cases, the shipping company submits  additional documents requested by the taxman, the payment will 
be exempt; yet such a situation has not observed in the other Ports in India. 
 Please explain why such unreasonable practi ces are undertaken on those two Ports? 
 Reply:  The observations are not clear and not substan tiated with examples. India has not received any 
complaint of any unreasonable practice. However, in terms of Article 8(2) of the Indo-Japan Double Taxation Avoidance Agreement profits  from the operation of ships in international traffic carried out 
by an enterprise of a Contracting State shall be taxable only in that Contracting State. The term ‘’enterprise of a Contracting State’ means an enterp rise operated by a resident of a Contracting State. 
Accordingly, it is necessary for the Assessing Officer to determine the tax residency of the claimant. 
For that purpose, the Assessing Officer is justif ied in asking for all the relevant documents. 
 
The Government Report (WT/TPR/G/182) 
 
VI. STRENGTHENING SECTORAL MARKETS  
(e) Telecommunications 
 (Question 1: page 22, paragraph 103)   
 
Please clarify whether the Indian authority has a domestic regulation on a fee of private leased 
circuits and imposes on a dominant carrier the obligati on to offer private leased circuits. If yes, 
please explain those regulations, in particular th e regulations on the leasing fee, interconnection 
rules and the obligation to offer private leased circuits. 
 Reply:  The regulations regarding leasing fee (tariff) a nd interconnections are issued by TRAI for 
leased circuits. The Licensee has to provide the leased  circuits in a transparent, non-discriminatory 
manner and based on the same commercial principle to all customers.  (Question 2: page 23, paragraph 107) 
 
According to the Government report, Internet tele phony services were opened to the private sector in 
April 2002 and there are 385 Internet service provid ers and 125 Internet tele phony service providers 
at present. 
 (1) Please indicate whether a dominant carrier exis ts in the internet telephony services sector. 
 
Reply:  No 
  WT/TPR/M/182/Add.1 
 Page 201 
 
 
  (2) In the domestic regulations of India, ISP is ca tegorized into two types: ISP with gateway and 
ISP without gateway. The limitation of foreign cap ital participation on an ISP with gateway is 74%, 
while the limitation of foreign capital partici pation on an ISP without gateway is 100%.  
 
Please specify how and where this regulation is d escribed in the schedule of the GATS commitment 
and revised offer from India. Please provide the curr ent situation where foreign capital enters into the 
Indian ISP market.   Reply:  No, it is not indicated specifically. However, India would like to add that 74% and 100% FDI 
are permitted respictively.  (3) Although the Internet telephony services were ope ned to the private sector in April 2002, 
opened sectors are limited only in such areas as ‘computer to computer’, ‘SIP to SIP’ and ‘computer to out side India’.  
 
Please indicate any plan to review this regulation an d allow the private sector to provide all Internet 
telephony services including ‘SIP to fixed ne twork’ and ‘computer to fixed network’. 
 
Reply:  The review of policy related to Internet telephony services is a continuous process and is  
based on stakeholder consultations and the recommendations of TRAI.  
 (iv) Telecommunications  
(Question 21: page 133, paragraph 115 footnote 159)   
 Footnote159 of the Secretariat report states that the majority of directors on the Board must be 
resident Indian citizens. In addition, PRES NOTE NO .3 (2007 SERIES) publis hed on 19 April 2007, 
indicates that not only the majority of directors on th e Board but also the Chief Officer in charge of 
technical network operations and the Chief Security  Officer should be a resident Indian citizen, and 
that the positions of the Chairman, Managing Director, Chief Executive Officer
 (CEO)  and/or 
Chief Financial Officer (CFO) would require to be secu rity vetted by the Ministry of Home Affairs 
(MHA) if held by foreign nationals.  
 
(1) In India’s schedule of commitment under the GA TS and offer in this round, India maintains 
the reservation that the detailed terms and conditions  for providing the service will be as per license 
conditions in the MA column, and ‘Unbound’ in the NT column.  
Japan would like to clarify in which column (MA or  NT) of the schedule and the offer India maintains 
the reservations concerning footnote 159.  
 Reply:  Both, as indicated under MA and NT. 
 
(2) Please provide the outline of the “security bet. ” Please provide detailed information on terms 
and conditions required from the viewpoint of security.  
Reply:  The security conditions are part of the license conditions. 
 
(3) Please indicate any plans to eliminate the measures concerning nationality requirements of 
directors on the Board. 
 
Reply:  The Government undertakes a review of the policy on  a continuous process. The Press Note 
No. 3 of 2007 series provides the guiding principles in this regard.  
 WT/TPR/M/182/Add.1 
Page 202  
 
  (4) In the PRES NOTE NO.3 (2007 SERIES), it is also indicated as restrictions concerning 
Remote Access (RA) that RA to the Network would be provided only to approved location(s) abroad 
through approved location(s) in India.  
 
Please provide specific examples and information about the terms and conditions required for the 
approval, and what kinds of operations th rough RA are allowed after the approval. 
 Reply:  The services are governed by the terms and cond itions of the license. The applicant has to 
indicate the purpose and provide justification. 
 
(5) Please confirm that it is right to understand that the revision of nationality requirements and 
restrictions for RA have been put into effect by the PRES NOTE NO.3 (2007 SERIES). If not, please 
explain what procedures and processes will be taken to put the revision into effect. 
 Reply:  The conditions mentioned in Press Note 3 (2007 series) have been included in the license 
conditions for compliance by all the licensees.  (6) In the other conditions stipulated in the licensing agreement, please provide all non-
conforming measures to MA or NT, exce pt for nationality requirements and RA. 
 Reply:  The license conditions are available on Do T’s website www.dot.gov.in under respective 
services.   (Question 22: page 133, paragraph 115 footnote 160)  
Footnote 160 of the Secretariat report describes t hat the MTNL is majority government-owned 
(56.25% of total equity).  
(1) Japan understands that the government also hol ds all shares of the BSNL. Please indicate 
which authority or ministry of the Government holds  the shares of the BSNL and the MTNL. Please 
provide information on any plan to sell off the shares.  
 Reply:  The shares are held by the Ministry of Finance, Government of India. Currently, there are no  
plans to sell off the shares. 
 
(2) Please provide specific provisions of la ws and regulations s tipulating government 
shareholdings. 
 Reply:  In Public Sector Undertakings  the majority shares are either held by the Central Government 
or by a State Government. 
 
(Question 23: page 134, paragraph 116) 
 
While the expansion for the market share of priv ate service providers in the mobile sector, public 
company has still kept 92.6% of the mar ket share in the fixed phone sector.  
 
(1) Please provide the names of service suppliers d esignated as major suppliers in fixed (local, 
long distance, and international), mobile and IS P sectors and indicate specific criteria of the 
designation. 
 
Reply:   No service suppliers are designated as major suppliers. All the licences are treated at par with 
respect to licensing conditions. List of service providers is available on DoT’s web site 
(www.dot.gov.in) in respective services.  WT/TPR/M/182/Add.1 
 Page 203 
 
 
  (2) Please provide information on the regulati ons regarding major suppliers in each sector. 
  
Reply:  No service suppliers are designated as major suppliers.  
 
(3) Please provide information on the regulati ons to prohibit cross-subsidization from a 
monopolistic sector to a competitive sector (infor mation including specific provisions and their 
outline).  Reply:  The Access Deficit Charges(ADC) are given to service providers such as  BSNL for providing 
services in commercially unviable areas.  (Question 24: page 134, paragraph 117)  As for the simplification of licensing regime through the UAS license, 
 
(1) Please provide information on the specific provisi ons of regulations to establish the period of 
time normally required to issue a license (not only the UAS license but all kinds of licenses). 
 
Reply:  No time frame has been indicated in the regul ations.  However, this is being done in a 
transparent manner  (on first-come-first basis) de pending upon the availability of scarce resources like 
spectrum etc. 
 
(2) Please provide information on the specific provis ions of regulations to set down responsibility 
to provide reasons for the denial of a license to the applicant upon request.  Reply:  A denial of a license is based on well-founded reasons.  
 
(3) Please clarify in what sub-sector the UAS is classified under the W/120. 
 
Reply:  It is classified under the Cellular M obile Telecommunication Service(CMTS). 
 
(Question 25: page 134, paragraph 118) 
 Although the Secretariat report explains the gradual  relaxation of the limitation of foreign capital 
participation, India’s domestic telecom market is not adequately open to Foreign Service suppliers, as 
the scope and level of relaxation remains limited.  
(1) Please indicate any plans to further relax th e limitation of foreign capital participation? If 
yes, please provide information on the scope and level of the relaxation.  
Reply:  The review of the policy relating to foreign capita l participation is a continuous process. It was  
relaxed recently as per Press Note 3 of  2007 series.   (2) Some reservations of domestic non-conforming me asures in India were not written in India’s 
schedule of commitment under the GATS and revised  offer, based on Article 14 of the GATS 
regarding security reasons.  
 Please provide all domestic non-conforming measures which are not described in India’s schedule of 
commitment under the GATS and revised offer.  
Reply:  Any measure in question may be indicated to facilitate a specific reply.  
 WT/TPR/M/182/Add.1 
Page 204  
 
  (Question 26: page 134-135, paragraph 117, 119,120) 
 (Government report: page  22, paragraph 103) 
 
The Secretarial report describes that entry fees and licensing fees have been reduced on Unified 
Access Service (UAS), national long-distance (NLD) and international long-distance (ILD).  
 
(1) apan would like to know whether or not India intends to keep reducing the requirements and 
fees in these areas. 
 
Reply:  The entry fees and license fees in the NLD a nd ILD sectors have already been reduced.  
Further reduction will depend on market conditions.  
 The reduction in the above series is as under: 
 
United Access Services (UAS)    from 12 %  10% 8%       to 10% 8% 6% & 5% w.e.f. 1.4.2004 
 
National Long Distance (NLD)  from 15% to 6% w.e.f.1.1.2006  
Inter National Long distance (ILD) from 15% to 6% w.e.f. 1.1.2006 
 
(2) Japan understands that the adjusted gross reve nue (AGR) is different from “gross revenue”. 
Please explain the methodology to calculate the AGR.  Reply:  Yes, the AGR is different from GR and broadly the AGR is arrived at after making the 
following deductions from the gross revenue.  Adjusted Gross Revenue (AGR): 
 
For the purpose of arriving at the “Adjusted Gr oss Revenue(AGR)” the following shall be excluded 
from the Gross Revenue(GR) 
 a) PSTN related call charges (Access Charges) actually paid to the other eligible/entitled 
telecommunication service providers within India. 
b) Roaming revenues actually passed on to th e other eligible/entitled telecommunications 
service providers and; 
c) Service Tax on provision of service and sales ta x actually paid to the Government if gross 
revenue had included as component of Sales Tax and Service Tax. 
 
For methodology to calculate the AGR, kindly vi sit Department of Telecommunications website: 
www.dot.gov.in.  (3) Under the licensing criteria, telecom carrier s are obliged to deposit a “Bank Guarantee” and 
“Financial Bank Guarantee”. Please elaborate on the methodology to calculate these Guarantees. 
 
Reply:  Performance Bank Guarantee (PBG) is to ensure  the performance of th e Licensed services and 
is calculated and fixed by the respective licensing branch in the Department of Telecommunications. 
 
 Financial Bank Guarantee is to secure the license fee dues. For the first year of the license, the 
FBG is for a fixed amount which varies across lic enses. Thereafter, adequacy of FBG amount is 
reviewed on a six monthly basis and the amount is fi xed equivalent to two quarters of license fee paid 
by the service operator enhanced by 10%.  WT/TPR/M/182/Add.1 
 Page 205 
 
 
  (4) According to paragraph 124 of the Secretarial report, telecom carriers are obliged to 
contribute 5% of their AGR to the Universal Services Fund. Japan would like India to clarify whether or not the contribution for the Universal Services Fund (5% of AGR) is included in the license fee 
(6% of AGR), and also to elaborate on the legal gr ounds of the obligation by briefing and specifying 
the articles.  
Reply:  The contribution for the Universal Service Ob ligation (5% of AGR) is included in the licence 
fee. The legal framework is provided by the Indi an Telegraph Act (ITA), 1885 as amended from time 
to time and rules framed there under.  
 
(Question 27: page 135, paragraph 121) 
 
The Secretarial report points out that the broadband policy announced by the DOT on 14 October 2004 allows service providers to access mu tually agreed commercial arrangements. 
 
(1) Japan would like to know whether or not  the Indian authority establishes domestic 
regulations on these commercial arrangements. If  yes, please provide information on the name and 
related article of the regulation. 
 
Reply:  The operators have published interconnect offe rs on their websites based on recommendations 
of TRAI.  
 
(2) Please indicate whether the dominant carrier is  subject to any extra regulation by these kinds 
of regulations when the dominant carrier agrees to  a commercial arrangement with a non-dominant 
carrier. If yes, please elaborate on the extra regulation imposed on the dominant carrier.  
 Reply:  No. 
 (3) Japan would like to know whether or not the Indian authority ensures any arrangement 
within the dictates that keep interconnection charges cost-oriented and sufficiently unbundled. 
 Reply:  Interconnect charges are based on TRAI recommendations in this regard. 
 
(4) Please provide a standard form of this kind of arrangement. Please provide information as to 
whether, under the agreement, a telecom carrier is  allowed to provide broadband services by such 
forms as dry-copper, line-sharing or bit-stream access scheme. 
 Reply:  Various interconnect agreements are available on the website of the service providers.  
 
(5) Please elaborate on the procedure to review th e interconnection charges on the facilities 
possessed by a dominant carrier. What regulations are established in order to keep interconnection 
charges reasonable and fair for all carriers? 
 Reply:  Every operator has to publish an interconnect agreement on its website. 
 
(Question 28: page 135, paragraph 122) 
 According to the Secretarial report, TRAI regul ates tariffs for services where markets are not 
competitive.  
 (1) Please indicate what criteria the Indian aut hority has to determine whether the market is 
competitive or not.  WT/TPR/M/182/Add.1 
Page 206  
 
  Reply:  The major criteria are availability of service to masses, teledensity etc.  
 
(2) If the Indian Government has a system to eva luate the competitiveness of the market, please 
elaborate on the evaluation methodology, the segmenta tion of the market and results of evaluation of 
each segmentation. Please cl arify whether TRAI is responsible for the evaluation.  
 Reply:  Yes. TRAI has been entrusted th e responsibility for major evaluations. 
 
REPLIES TO FOLLOW-UP QUESTIONS FROM JAPAN
 
 
1. Question 4 
 Japan asked the following written question to India:  ‘While India’s average applied rate on non-
agricultural products in 2006/2007 is 12.1% as a result of th e tariff reductions, the average bound 
rate for non-agricultural products is 34.7%. In addition to the discrepancy between the applied and 
bound rates, low binding coverage for non-agricultural products (71.6%) is not predictable. In terms 
of predictability, it is favorable to reduce as much as possible the discrepancy between the applied 
and bound rates and to increase the coverage.’  
 
While this question intends that the wide gap between the applied and bound rates and the low binding rate should be improved in light of damaging the predictability remarkably, we have not 
received a sufficient reply to this question. 
 
In this light, could India indicate specific view  on the improvement of the wide gap between the 
applied and bound rates and the low binding rate? 
 
Reply:  The decision to lower India’s bound rates a nd increase binding coverage would depend on the 
outcome of the NAMA negotiations currently underway in the WTO. 
 
2. Question 9 
 
Japan would like to know whether India has an y law or notification regarding the export tax 
measures on iron ore and chromium ore since March  1, 2007. If yes, Japan would like India to 
provide them.  
 
Reply:  Export tariffs are provided in the Second Schedule to the Customs Tariff Act, 1975. The 
details are available at  http://www.cbec.gov.in/customs/cst-0708/cess-06.pdf and http://www.cbec. 
gov.in/customs/cs-act/notifica tions/notfns-2k7/cs62-2k7.htm. 
 
3. Question 12 
 
Please provide the information on the government al regulation regarding the remittance of royalty. 
 
Reply: The payment of royalty under a foreign techni cal collaboration agreement is governed by the 
Guidelines issued by the Ministry of Commerce a nd Industry, Department of Industrial Policy and 
Promotion which has issued the fo llowing Press Notes on this issue.  WT/TPR/M/182/Add.1 
 Page 207 
 
 
   
LIST OF PRESS-NOTES  AND PRESS RELEASES 
RELATING TO FOREIGN TECHNOLOGY AGREEMENT 
Press note No. and Date Subject Page 
No.  Previous Press Note/ 
Notification 
No.10 (1991 series) dated 14.08.1991 Foreign Technology Agreement –Pro cedure and List of industries 
(annex-III) for automatic approval of foreign technology agreements and for 51% foreign equity approvals   Statement on Industrial 
Policy dated 24.07.1991 
No.12 (1991 series) dated 31.08.1991 Procedure in respect of Foreign Technology Agreement-amendment to 
Press Note No.10 dt.14.8.91  No.10 (1991 series) 
dated 14.08.1991 
No.18 (1991 series) dated 25.11.1991 Clarification on ‘Hotels’ & ‘Tourism related Industry’ and criteria for 
automatic approval for foreign technology agreement in Hotel Industry.  No.12 (1991 series) 
dated 31.08.1991 
No.19 (1991 series) 
dated 09.12.1991 Import of technology and capital goods under Technical Development 
fund Scheme-Further liberalization  No.2(1)/88/ TDF dated 
22.04.1988 & 
No.2(1)/89-TDF dated 17.03.1989 
No.20 (1991 series) dated 13.12.1991 Revision of application form fo r foreign investments/ foreign 
technology agreements  Nil 
No.21 (1991 series) 
dated 15.12.1991 Changes in procedures in respect of foreign technology 
agreement/foreign investment  No.10 (1991 series) 
dated 14.08.1991 
No.4 (1992 series) 
dated 20.03.1992 Procedure in respect of foreign T echnology Agreement. Consequences 
of Liberalised Exchange Rate  Management system(LERMS)  No.12 (1991 series) 
dated 31.08.1991 
No.6 (1992 series) dated 14.05.1992 Removal of Prohibition on use of foreign brand names/trade marks by 
industry for internal sale – clarification on.  Nil 
No.10 (1992 series) 
dated 24.06.1992 Revision of Annexure-III items for automatic approval of foreign 
technology agreement and for 51%  foreign equity approvals.  No.12 (1991 series) 
dated 31.08.1991 
No.1 (1993 series) 
08.01.1993 Abolition of the Special Committee on Fertilizers projects – Erstwhile 
dealing with IL, FFC, FTC and impo rt of CG for Fertilizer projects.  S.O.162(E)/RLIU/10(2
)/76 dated 03.03.1976 
No.4 (1994 series) 25.10.1994 Modified Policy for grant of license and approval for foreign 
investment/foreign technology agreements for drugs and 
pharmaceuticals industry.  No.10 (1992 series) 
dated 24.06.1992 
No.1 (1995 series) dated 21.03.1995 Revised norms for automatic a pproval for foreign technology 
agreements in the hotel industry  No.18 (1991 series) 
dated 25.11.1991 
No.4 (1996 series) dated 05.11.1996 Further liberalization in parameters  (foreign exchange requirements for 
import of CG and condition of pl ant & machinery) of automatic 
Approval in foreign equity and foreign technology collaborations.  No.12 (1991 series) 
dated 31.08.1991 
No.18 (1998 series) dated 14.12.1998 Guidelines pertaining to approval of foreign/technical collaboration 
under the automatic route with prev ious ventures/tie-ups in India  Nil 
No.10 (1999 series) 
dated 12.04.1999 Guidelines pertaining to approval of  foreign /technical collaborations 
under the automatic route with previous ventures / tie-ups in India.  No.18 (1998 series) 
dated 14.12.1998 
No.9 (2000 series) 
dated 08.09.2000 Review of existing sectoral policy an d sectoral equity cap for FDI and 
investment by NRIs / OCBs – Provision of payment of royalty under 
automatic route for use of trade mark and brand name.  No.7 (2000 series) 
dated 14.07.2000 
No.1 (2001 series) dated 02.01.2001 Guidelines pertaining to approval of  foreign/ technical collaborations 
under the automatic route with previous venture / tie-up in India in 
respect of FIIs such as ADB, IFC, CDC, DEG etc.,  No.18 (1998 series) 
dated 14.12.1998 
No.1 (2002 series) dated 03.01.2002 Guidelines for payment of royalty under automatic route for use of 
trademark and brand name of the fo reign collaborator with technology 
transfer  No.9 (2000 series) 
dated 08.09.2000 
No.2 (2003 series) 
dated 24.06.2003  Liberalization of Foreign Technology Agreemen t policy and procedures  No.1 (2002 series) 
dated 03.01.2002 
 
 Under the Foreign Exchange Management Ac t (FEMA), payment of royalty under a foreign 
technical collaboration agreement is  permitted in terms of FEM (Current Account Transaction) Rules.  
  Earlier the remittances were not permitted if the foreign collaboration was not registered with 
the Reserve Bank of India. However in terms of AP  (Dir series) no 76 dated February 24, 2004, the 
requirement of having to register an agreement with the Reserve Bank of India has been dispensed 
with.  
 WT/TPR/M/182/Add.1 
Page 208  
 
   At present in terms of item 8 of Schedule II to the said Rules, Authorized Dealers (ADs) may 
allow the remittance where the payment of royalt y does not exceed 5% of local sales and 8% of 
export sales and the lump sum payment does not exce ed USD 2 Million. In case the royalty agreement 
provides for a higher remittance, the agreement need s the prior approval of the Ministry of Commerce 
and Industry.  
 
4. Question 14 
 
It seems to Japan that India’s reply is related only to Question 14(6) in respect of “action for 
infringement of trademark”. Japan would also like to be informed of the “protection of trade 
secrets”.  
 
From this point of view, please reply to Ques tion 14(1)-(5) and provide clear explanation on the 
protection of trade secrets.  
 
Reply: There is no specific law for protection of trade secrets. 
 5. Question 17 
 As Japan has not received the answer to Question 17, Japan would appreciate an answer to the 
question from India.  
 [The question is reproduced for convenience. (Question 17: page 124, paragraph 83)   
 
According to the Secretariat report, the exports of auto components increased from US$578 million in 
2001/02 to US$2.1 billion in 2005/06, while expor ts of automobiles as a proportion of total 
production increased from 3.5% to 8.9% during the same time. This indicates that exports of 
automobiles play a significant role as an engine to promote the Indian economy.  
 
(1) In order to further promote these exports  of automobiles, does India have any plan to 
participate in the UN/ECE framework (‘1958 Treaty ’) regarding technical prescriptions for wheeled 
vehicles, equipment and parts, so that the vehic les exported from India can enter foreign markets 
without re-examination of the importing countries, such as the EU?   
(2) Japan would appreciate it if India indicates future prospects of joining the 1958 Treaty.] 
 
Reply: It would be essential to evalua te our national policies, impa ct on trade, development of 
automotive industry etc. before a decision to join the 1958 Agreement is taken. Accordingly, a group 
comprising the major stakeholders has been set up on 18.4.2007 to study the implications of adopting 
the 1958 Agreement. It has been given si x months time to complete its work.  
 
6. Question 21(2)  
 
While Japan requested India to provide detaile d information on the “security bet”, Japan is 
concerned that the answer from India does not respond to Japan’s question sufficiently.  
 
In this regard, could India clarify what kind of criteria and requirements regarding the “security bet” 
are specified in the license conditions? 
 Reply:  The security conditions containe d in Press Note 3 of 2007 dated 19
th April 2007 have been 
included through an amendment in the license cond itions for services covered under Press Note 3 of 
2007.   
  WT/TPR/M/182/Add.1 
 Page 209 
 
 
  7. Question 23(2) 
 While India explained in its written answer t hat no services suppliers are designated as major 
suppliers, Japan would like to clarify the following points:  
 (1) Are there any regulations, including designati ng criteria specific to major suppliers, even if 
no services suppliers are designated as major suppliers right now? 
 
Reply: There are no regulations.  
 
(2) Are there any suppliers who control essential facilities and any regulations for such services 
suppliers? 
 Reply:  Government has not assigned control of essential facilities to any supplier.  
 
8. Question 24(2) 
 While India explained in its written answer that a denial of licenses is based on well-founded reasons, 
Japan would like India to clarify the following points:  
 (1) Are there any regulations requiring that reasons  for the denial of licenses be made known to 
the applicant? 
 (2) If no, are there any plans to introduce regula tions to set down “making publicly available the 
period of time normally required to issue a licenses”  and “responsibility to provide reasons for denial 
of licenses”? 
 
Reply: Right to Information Act is in place. The deta ils are available at the web-site www.dot.gov.in 
  UNITED STATES
 
 
(ix) Import Prohibitions, Restrictions, and Licensing 
 
Paragraph 37 on page 46 outlines some of the reasons why India maintains imports or export 
prohibitions.    
• One justification given for import prohibitions  is “prevention of agricultural surpluses.”  
Please explain.  
 Reply: Currently, no agricultural product attracts import prohibition.  
 
(4) Manufacturing 
 
(vi) Other Charges Affecting Imports 
 Page 44, Paragraph 34:
  The report states that the VAT is not levied on imports or exports.  However, 
is the VAT levied on imported products  when transferred within India? 
 Reply:  State VAT is levied on the sale or purchase of goods within a State in India, irrespective of 
whether the goods being sold is imported goods or domestically produced goods. There is no 
discrimination between the domestically produced goods and imported goods in this regard.  WT/TPR/M/182/Add.1 
Page 210  
 
   
Page 44, Paragraph 34
:  The report notes that differences remain  between the special duty applied to 
imports and other domestic taxes and that while the sp ecial duty is 4%, like domestic products may be 
subject to a tax rate less the 4%.    For each state, please identify: (1 ) the specific internal tax or taxes 
that the special duty on imports allegedly counterbal ances, (2) whether any of these internal taxes 
also apply to imported products, and (3) whether any of these internal taxes subject imports to 
taxation in excess of like domestic products.   Plea se explain how India determined that a special duty 
on imports of 4% is appropriate to counterbalance internal taxes on domestic products when some 
domestic products are subject to taxation at less than 4%.      
 Reply:  Special additional duty of customs, commonly kn own as special CVD, at the rate of 4% has 
been levied on imported goods to counter balance the internal taxes such as sales tax, value added tax, 
local tax or any other charges leviable on a like artic le on its sale, purchase or transportation in India. 
  The intention of the Government is to safegua rd the interests of indigenous industry, which 
suffers from various taxes levied and collected by th e States. The levy of special CVD is to counter 
the impact of such taxes.  To illu strate, taxes levied on such goods by various agencies other than the 
Central Government are:  
(a) CST on inputs procured from other States. 
(b) CST on products sold in other States. 
(c) Octroi levied by Municipalities on entry of goods. The rate of octroi varies from 2.5% 
to 5.5%. This is applicable on in puts needed by the industry also. 
(d) Electricity duty levied by the State Governments on consumption/sale of electricity, 
which is one of the inputs for manufacture of  goods. Rate of electricity duty varies 
from State to State. 
(e) Sales tax on petrol/diesel – No credit. 
  These taxes are in addition to general St ate VAT which varies between 4% - 12.5%. 
  In India, no set-off is available for the CST on inputs, octroi on inputs, electricity duty and sales tax paid on auto fuels.  Total of these intern al taxes depends upon the location of an industry and 
type of goods it manufactures. Special additional dut y is charged only at 4%, which is the minimum 
rate.
 The incidence of internal taxes borne on domest ic product are much higher than the Special CVD 
rate of 4%.  
Annex III.1, paragraph 3 of the report states that th e additional duty rates charged on imports are the 
same as the excise duties charged on domestic products .  The report further states that the additional 
duty is calculated as a percentage of the value of  the import plus any applicable tariff.  How does 
India ensure that the effective rates of additional duty on imports are the same as the excise duties 
charged on like domestic products, if only the former include applicable tariffs in the calculation of 
the amount of duty owed?  
Reply:  The point raised is not clear. The additional duty  is levied in lieu of the excise duty which is 
leviable on a like article produced or manufactured in India.   
(4) Developments in Foreign Investment  
 
Paragraph 39 (page 29) of the Secretariat report says “that, despite economic liberalization, foreign 
direct investment (FDI) had not entered India to the degree expected…”  The United States welcomes 
India’s efforts and notes that the sectors that have been liberalized the most, such as IT and services 
(as described in section IV, “Trade Policies by Sector ”) are recording the highest rates of growth in 
India. (; Department of Economic Affairs)  WT/TPR/M/182/Add.1 
 Page 211 
 
 
   
♦ Please provide an update on India’s plans to eliminate FDI caps in the insurance and multi-
brand retail sectors.    
♦ Does India plan to allow greater foreign invest ment in sectors, whether directly and/or 
indirectly, where growth rates are lagging, such as in the agriculture sector and in major services 
sectors like banking?   Increased liberalization in such areas as multi-brand retail, capital markets, 
basic infrastructure, food processing and distributio n networks would help to create the conditions 
necessary for further investment in the Indian economy.   
 
Reply:  FDI inflows into India have recorded a consistent growth and the inflows since 2004-05 are: 
 
♦ 2004-05- US$ 3.2 bn. 
♦ 2005-06 – US$ 5.5 bn 
♦ 2006-07 – US$ 15.7 bn. 
  In the insurance sector, it h as been proposed to amend the Insurance Act, 1938 which would 
inter alia, include amendments relating to the e nhancement of FDI in Indian Insurance companies 
from 26% to 49%.  A draft bill is already under consideration of the government.  
 
 On the other sectors, a review of the FDI po licy is undertaken on continuing basis. The policy 
is decided by the government. 
 
(4) Foreign Investment Regime  
(iii) Incentives  
 Page 30, Para 43:  Please explain how it is det ermined if a “value-added” norm will be met by a 
particular proposed project.  
 
Reply: India has a liberal FDI regime. India do es not offer special incentive for FDI. 
 (v) Intellectual Property Rights 
 
Patents  
 
Standards of patentability:  Does India plan to consider any amendmen ts or further modifications to 
the patent law, including with resp ect to patentability criteria?   
 
Reply: India follows the global norms for determining pa tentability, i.e., novelty, inventive step and 
industrial applicability. This definition has been used particularly to ensure that no frivolous patent is 
granted and ever-greening of the patent is prevented.  
  Discovery is not considered patentable. To be patentable, an invention should have an 
intellectual contribution. Section 3(d) prevents gran t of frivolous patents for new forms or new usages 
of known substances.  Section 3(d) lawfully incor porates safeguards by strictly defining standards of 
patentability for pharmaceutical products so as to excl ude minor variations of existing medicines that 
do not add significantly to therapeutic efficacy.    
  Explanation to section 3(d) has been added to prevent ever-greening of the patent. The 
Explanation clearly differentiates between the disco very of a new form of the known substance and WT/TPR/M/182/Add.1 
Page 212  
 
  the known form of the substance. To qualify for patentability, the new form of the known substance 
should differ significantly in properties with regard to known efficacy. 
 
Pre-grant opposition: In par agraph 157 of the Secretariat’s Report,  it is noted that the Patent Act 
provides for pre-grant opposition to the granting of  a patent.  How does India ensure that the pre-
grant opposition procedure does not unreasonably delay the grant of a patent?  
Reply: Law and procedures are evolutionary processes. As  and when the need arises, a decision to 
make changes could be considered.  
 The system of pre-grant opposition is followed by several countries. The amendments in the 
Patents Act in 2005, simplified the procedure for pre-grant opposition. Earlier it was a time 
consuming quasi-judicial process. The amended law provides for an administrative procedure which is simple, fast, and efficient and is in accordance wi th principles of natural justice. Even against the 
administrative order, an appeal can be filed with  the Intellectual Property Appellate Board (IPAB) as 
per Section 117A of the Patents Act.  In any case, so far the number of pre-grant opposition has been 
negligible; only 199 against 50295 publications. In the case of post-grant opposition also the decision of the Controller can be challenged through an appeal before the IPAB. 
 
In paragraph 158 of the Secretariat’s Report, it is not ed that efforts are being made to clear the 
backlog of patent applications.  Please confirm whether India is considering technical assistance to 
address the shortage of patent examiners.  If so, pl ease provide information about the nature of such 
assistance.   Paragraph 161 of the Secretariat’s Report notes that appeals will be  made to the newly established 
Intellectual Property Appellate Board. Is the Inte llectual Property Appellate Board (IPAB) in India 
fully operational?  Have all IP-related appeals been  handed over from the High Court to the IPAB?  
 
Reply: Law and procedures are evolutionary processes. As  and when the need arises, a decision to 
make changes could be considered.   The system of pre-grant opposition is followed by several countries. The amendments in the 
Patents Act in 2005, simplified the procedure for pre-grant opposition. Earlier it was a time 
consuming quasi-judicial process. The amended law provides for an administrative procedure which is simple, fast, and efficient and is in accordance wi th principles of natural justice. Even against the 
administrative order, an appeal can be filed with  the Intellectual Property Appellate Board (IPAB) as 
per Section 117A of the Patents Act.  In any case, so far the number of pre-grant opposition has been 
negligible; only 199 against 50295 publications. In the case of post-grant opposition also the decision 
of the Controller can be challenged through an appeal before the IPAB.   Patent applications filed in India have w itnessed five fold increases since 1999-2000. Patent 
grants have also shown 7 fold increases during the same period. Number of Examiners has increased 
four fold during the same period. US $ 30 million ha ve been spent for modernization of Intellectual 
Property Offices.  US $ 70 million is envisaged to  be spent for further strengthening and capacity 
building activities.   Intellectual Property Appellate Board (IPAB) is fully operational including for patent cases 
from 2nd April 2007. All the cases of appeals against any order or decision of the Controller and all 
cases pertaining to revocation of a patent other than  on a counter claim in a suit for infringement and 
rectification of register pending before any High Co urt shall stand transferred to the Appellate Board 
from 2 April 2007. This is a fast track mechanis m for deciding appeals against the decision of the 
Controller. 
  WT/TPR/M/182/Add.1 
 Page 213 
 
 
  Data Protection 
 
Does India, as a condition of approving the marketing of pharmaceutical or of agricultural chemical 
products which utilize new chemical entities, require the submission of undisclosed test or other data 
to establish that the product is safe and/or effective?  If so, how does India protect such data against 
unfair commercial use?      
 
Reply:  The existing laws, namely the Drugs and Cosm etics Act and the Insecticides Act provide data 
protection. The Indian Government is presently examin ing the extent of change that would be needed 
in these laws to give protection against unfair use of  clinical test data submitted to the regulators.  
 
Enforcement  
 Paragraph 184 of the Secretariat’s Report notes th at an amendment is currently under consideration 
in India that would transfer the power of banning impor t of IPR-infringing copies from the Registrar 
of Copyrights to the Commissioner of Customs.  Please provide information on how the proposed 
amendment improves India’s customs enforcement s ystem, including the timetable for implementation 
of the amendment.  Are there any other improvements  to the customs enforcement system that India is 
currently considering?  Paragraph 185 of the Secretariat’s Report suggest s that the courts are backlogged and there are 
significant delays in bringing criminal and civil cases to final judgment.  Please provide information 
on how India plans to improve the efficien cy of court proceedings in IPR cases.  
 
Reply: There is no specific time frame for trail befo re the Courts. However, The Government has 
established a fast track mechanism by setting up an Intellectual Property Appellate Board which 
endeavors to take up the cases of infring ement in an expeditious manner.  
 
Copyrights  In paragraph 154 of the Secretariat’s Report, it is  noted that there are proposals to amend further the 
Indian Copyright Act, in the light of the WIPO  Copyright Treaty and the WIPO Performances and 
Phonograms Treaty (WIPO Internet Treaties). When  does India plan to receive the Copyright Act to 
implement adequately the provisions of the WIPO Internet Treaties? 
 
Reply:  No such time frame can be set in view of Pa rliamentary approval required to be obtained in 
respect of any law. The process of stakeholder cons ultation as a part of the process of amending the 
Copyright Act is currently on. The suggestions  received from various sectors along with the 
comments/ suggestions received from other stakeholders  is being carried out by the expert/ technical 
committees constituted for the purpose.  India has one of the modern copyright laws in the world and 
the amendments made to the Indian Copyright Act from time to time had ensured that it was fully 
TRIPS complaint. Though India has not yet accede d to the two internet treaties namely, WIPO 
Copyright Treaty (WCT) and WIPO Performances a nd Phonograms Treaty (WPPT), the process is on 
for amending the Copyright Act with a view, inter al ia, to explore the possibilities of incorporating the 
relevant provisions of the two treaties in the Copyright Act, 1957.  
In paragraph 169 of the Secretariat’s Report documen t, India notes that “compulsory licences may be 
issued for works withheld from the public….” C an compulsory licensed be issued for non-Indian 
works that are withheld from the public? Does “Indian works” include U.S. produced works, 
performances and phonograms that are recorded or manufactured in India? Please explain the scope 
of Section 31 and 31 A of the Copyright Act and how many licences have been granted by the 
Registrar of Copyrights, pursuant to these provisi ons, within the last 5 years. Of those licenses WT/TPR/M/182/Add.1 
Page 214  
 
  granted please provide information as to the types of works, uses of works sought by the 
complainants, and any additional inform ation on how these licenses are granted? 
 
Reply: Section 2 (i) define the word “Indian works”. The term “Indian work” is to mean a literary, 
dramatic or musical work: 
 
(i) the author of which is a citizen of India; or 
(ii) Which is first published in India; or 
(iii) The author of which, in the case of an unpub lished work, is at the time of making of the 
work, a citizen of India 
 
 This definition covers the works, authors of which are not citizen of India but which for the 
first time has been published in India.   Section 31 of the Copyright Act, 1957 (as am ended from time to time) describes the steps 
required to identify the copyright holder before a compulsory license is issued for works withheld 
from the  public.  
Paragraph 148 of the Indian Government Report re fers to State Governments’ responsibilities for 
enforcement and the establishment of IPR Cells.  Please provide information on how enforcement 
statistics from the State level IPR Cells are conveyed to the Ce ntral Government.   
 Reply: The information is available at the website: http://ncrb.nic.in.  
 
Further, is the information provided on a regular  basis, and is it available to the public?  Do the 
State-level IPR Cells collect information on the number of IPR cases settled through the courts, 
whether sentences and/or fines were imposed in criminal cases, and how much time was served in 
cases involving sentencing?  Is this information made  available to the public, and if so, how?  If this 
information is not currently collected by the St ate-level IPR Cells, are there plans to begin to 
systematically collect this information?  
Reply: The information is collected by the National Cr ime Records Bureau on regular basis and is 
available at the website: http://ncrb.nic.in.  
 
Paragraph 148 of the Indian Government Report furt her refers to an Inter-Ministerial Coordination 
Committee on IPR Enforcement Issues.  Please pr ovide information on the composition of this 
Committee, how often it meets, whether it produces or  plans to produce a report of its work, and the 
role of State Governments with respect to the Committee.  
 
Reply:  Enforcement of intellectual property rights in India is carried out by the police for domestic 
cases and by the police and customs for imports and exports. Domestic enforcement, especially for 
copyright violations have been stepped up, notabl y through the establishment of special intellectual 
property rights cells in most States as well as thr ough the nodal officers who coordinate enforcement 
activities with the industry. IPR cells set up by the State Governments for enforcement of IP rights 
deal with all types of IP violations includi ng Trade Marks, Patents, Designs, Copyrights, 
Geographical Indications, etc.   The National Crime Records Bureau collects statistics on counterfeiting and piracy cases.  
During January to June 2005, a total of 2,108 copy right infringement cases were registered as against 
1,211 during the same period in 2000 and arrested  over 2,000 offenders, seized material worth Rs. 93 
million. Indian Music Industry (IM I) conducted 2100 raids in which 2255 arrests were made in 2005-
06 in music related piracy cases.     WT/TPR/M/182/Add.1 
 Page 215 
 
 
   The Copyright Advisory Enforcement Council provides advice to the Government on 
improving the enforcement of copyrights. Enforcement by the police has been stepped up through the increasing use of ex-officio raids since 2004.  As a result, 6,290 cases were filed in 2004 with the 
National Crime Records Bureau (compared to 1,211 cases of copyright infringement in 2000); most of 
these cases relate to copyright and trademark infringement.  
 
 The relevant sections of the IP right holders ha ve come together by forming associations in 
the Fast Moving Consumer Goods (FMCG) secto r, the music and entertainment sector, the 
pharmaceutical industry etc. recognizing the gravity of the problems and to identify the necessary 
steps that are to be taken to tackle the issues.  Regular seminars, workshops and training programmes 
are being organized for enforcement agencies such as police, customs, etc. to sensitize them about IP 
issues and also about the steps to be taken by them to fight counterfeiting and piracy.   The police are vigilant and prompt in taking suitable action, immediately upon receipt of the complaints from the right holders.  Search of pr emises, seizure of duplicat e, fake and counterfeit 
products, arrests of the offenders, with sufficien t publicity in the print and electronic media are 
regularly carried out successfully.  Most police de partments are now equipped with a separate cell 
with regard to cyber crimes which includes amongst other issues the sale and distribution of pirated 
goods.   The Government has also stepped up training to increase awareness of intellectual property 
rights enforcement. The Intellectual Property Training Institute (IPTI) provides training to 
government officials (including from the Intell ectual Property Offices and from other government 
agencies), employees in the private sector, including management levels creators of IPRs and academics, and to “potential users from the public at large”.  Special modules on IPRs have been 
included in the induction training programmes at the Customs and Police Academies. 
 
An Inter-ministerial  Coordination Committee on Intellectual Property Enforcement Issues 
has been set up with members drawn from variou s Government Departments concerned with IPR 
matters, namely the Department of Industrial Polic y and Promotion, the Department of Information 
Technology, the Department of Higher Education,  the Department of Agriculture and Cooperation, 
the Department of Commerce, the Department of Health and Family Welfare, the Ministry of 
Information and Broadcasting, the Ministry of Home Affairs, the Central Board of Excise and 
Customs and the National Crime Records Bureau . During the meetings of the Coordination 
Committee, broad issues in the context of cont inued emphasis on enforcement are discussed. The 
Committee holds its meeting once in a quarter.    Trademarks/Geographical Indications 
 
Paragraph 173 of the Secretariat’s Report relates to  protection of geographical indications. Please 
clarify how an application for a geographical indi cation is treated by the Controller General of 
Patents, Designs, or Trademarks (or other competen t authority), if it conflicts  with a prior-in-time 
trademark. 
 
Reply: Section 26(1) of the Geographical Indications (Registration and Protection) Act, 1999 (GI 
Act) protects the validity of a registered trade ma rk which contains or consists of a Geographical 
Indication if it has been already registered in good faith before commencement of the GI Act.  
 
 Further, as per Section 26(4) of the GI Act no action seeking to prevent the use or 
cancellation of registration of such registered trade mark can be initiated after 5 years from the date of 
commencement of GI Act, i.e. after 15
th September, 2008. The GI Act was brought into force with 
effect from the 15th September, 2004. 
 WT/TPR/M/182/Add.1 
Page 216  
 
  (5) Services 
 (iii) Financial services 
 
Securities:  Paragraph 112 (page 133) describes the levels at which foreign institutional investors 
(FIIs) are permitted to invest in th e securities sector.  Paragraph 114 of India’s report states that “the 
limits for FII investment in government securities and corporate debt have been gradually enhanced 
in order to provide more investment opportunities to  FIIs and greater depth to the Indian debt 
market.”   We agree that FIIs can invest in debt  securities, but these limits, although enhanced, are 
still too low for India's needs and the interest of forei gn capital, thus maintaining a barrier to greater 
capital flows.  What steps is India taking to furth er liberalize the securities sect or to allow for greater 
investment flows?    
 Reply:  The limit for FII investments in Government secu rities is being enhanced in phases, consistent 
with developments in the Government securities ma rkets. Accordingly, the limit has been enhanced 
from the limit of USD 2 billion in a phased  manner to USD 2.6 billion by December 31, 2006 and further to USD 3.2 billion by March 31, 2007 with out any change in the extant limit of USD 1.5 
billion for investment in Corporate Debt.  
 
 These limits are subject to periodic reviews and enhancements of these limits would be considered as and when the necessity arises.   
(ix) Import Prohibitions, Restrictions, and Licensing 
 
In paragraph 37, page 46, Table III.4, the Secretar iat report mentions the prohibitions of animal 
rennet.  The World Organization for Animal Health (OIE) c ode for Bovine Spongiform Encephalopathy (BSE) 
clearly states that no BSE-related requirements shoul d be applied to milk or  milk products.  Why does 
India prohibit animal rennet as it relates to dairy products?  
 In paragraph 61, page 55, the report states that, acco rding to the authorities, India’s restrictions on 
imports of live birds, fresh poultry meat, and meat  products due to avian influenza (AI) have been 
resolved amicably. By India’s WTO notification (April 17, 2007), we recognize its steps towards 
bringing AI policies for dried processed pet food  into line with the recommendations of the World 
Organization for Animal Health (OIE).  What risk assessment did India use to support th e current ban on processed poultry, meat, live pigs 
and pig meat products?  
The World Organization for Animal health (OIE ) does not recommend nationwide restrictions on 
commercial poultry due to AI findings in wild birds.  What is India’s policy on poultry and meat products from countries free of notifiable avian influenza (NAI) and free of highly pathogenic 
notifiable avian influenza (HPNAI)? How does India ensure that such import policies are applied on 
a non-discriminatory basis? 
 
What is the relationship between India’s currently applied AI measures and those laid out in the OIE 
guidelines, pertaining to acceptable international measures to prevent the spread of this disease 
through commercial poultry trade? 
 
Reply:  The observations of US are not clear, because as pe r India’s health protocol in respect of dairy 
products, if the product contains animal rennet, it only needs to be indicated. Besides, this the 
condition on rennet has no relevance to BSE risk.   WT/TPR/M/182/Add.1 
 Page 217 
 
 
   The conditions put on the import of certain  livestock / livestock products are based on 
available and recognized scientific information abou t their potential to harbour the AI virus. Both 
poultry and pig are known to harbour AI virus.    The import of poultry and porcine products c ited in notification SO 102 (E) dated 2.2.2007 
(available on the website of the Department (w ww.dahd.nic.in)) is not permissible from Avian 
Influenza (both low pathogenic and highly pathog enic avian influenza) positive countries. While 
implementing the provisions of the notification, I ndia takes into consideration all the relevant 
information as per Article 2.7.12.3 of OIE Terr estrial Animal Health Code 2006 including the 
steps/measures under taken by the country  to  declare freedom  from Avian Influenza. 
 
 OIE itself mentions that epidemiology of AI di ffers widely in different regions of the world 
and therefore, it is impossible to provide specific guidelines for all situations. India’s Avian Influenza 
measures are based on technical consultations with  experts and other available relevant scientific 
information. 
 
(xi) Standards And Other Technical Requirements  
 The supplement to the Government of India’s Fo reign Trade Policy (2004-2009), notified to the WTO 
Technical Barriers to Trade Committee on May 23 , 2006, requires that all imports containing 
products of modern biotechnology receive prior a pproval from the Indian Genetic Engineering 
Approval Committee, and that all imports would, on a shipment-by-shipment basis, be required to 
document the “genetic content” of the commodity.   a) Please provide details regarding the compositi on of the Indian Genetic Engineering Approval 
Committee, its authority and the scope of this regula tion.  Will India implement a testing regime in 
relation to this regulation and whic h entity would hold responsibility fo r implementing this testing?  
Further, would results of tests conducted by this  entity be recognized across all Indian States?  
 
Reply: The composition of the Genetic Engineering A pproval Committee (GEAC) is available at the 
website of the Ministry of Environment & Forests: http://envfor.nic.in.  Other details such as the regulations governing the import of genetically en gineered organisms are also available at that 
website.  
 
Paragraph 57 on page 54 of the Secretariat report describes India’s current ef forts to streamline the 
enforcement of SPS procedures and enforcement by consolidating 13 laws under the Food Safety and 
Standards Act.  We understand that the Food Safet y and Standards Act would actually consolidate 
seven laws.  Please confirm how many laws and whic h ones will be consolidated under the new act. 
 
Reply:  The Food Safety and Standard Act, 2006 has b een passed by the Parliament and is being 
notified for its implementation. This Act would cons olidate different existing laws relating to food. 
 
Please provide further details regarding the envisioned role of the Food Safety and Standards 
Authority (FSSA), slated to be established under this  act.   Particularly, will FSSA become part of an 
existing specific Ministry?  What will be the juri sdiction and role of the Authority?  How will it 
interact with other Ministries?   
Reply:  The primary role of the Food Safety and Standard Authority, established under the Food 
Safety and Standard Act, 2006, has been enumerated in detail in Section 16 of the said Act. This can 
be viewed at the website: http://mofpi.nic.in. 
 
Will FSSA have a role in the areas of bio-engin eered foods, feeds, and seeds?   Will this Authority 
develop new regulations?  On what existing st andards will it base its regulatory requirements? WT/TPR/M/182/Add.1 
Page 218  
 
  Reply:  The Food Safety and Standard Authority would have the power to make rules and regulations 
under the Food Safety and Standard Act, 2006 on various items of foods as laid down in the Food Safety and Standard Act, 2006.  
 
What is the current status of this Act?  What is India’s timeline for implementing this Act and 
establishing the FSSA?    
Reply: The Food Safety and Standard Act, 2006 has been  passed by the Parliament and is being 
notified for its implementation. 
 
Paragraph 61, page 55:  The Secretariat states that according to authorities, the ban on the use of 
food grade waxes has been resolved amicably.  We recognize India’s steps toward bringing policies 
on food grade waxes into line with those of C odex Alimentarius for beeswax and carnauba wax. Why 
has India not approved shellac as a food grade wax, recalling that the Codex Alimentarius 
recommended it be approved as such?   
 Reply:  India has held deliberations with its stakehol ders on the issue of approving Shellac as a food 
grade wax. Concerns, such as those related to consum er safety, methodology, etc are  being examined.  
 
What risk analysis did India perform that led to th is exclusion?  Is shellac approved for use in food 
products domestically—including in pharmaceutical products?   
 Reply:  Shellac has not as yet been approved for use in  the food products domestically. There is no 
question of any discrimination between the standa rds applicable for the domestic products and 
imported products.   Paragraph 61 on page 55 of the Secretariat repor t mentions India’s “best before” date labeling 
requirement for fresh fruit. Codex standard 1-1985 (Rev. 1-1991) 4.7(vi) states that an indication of minimum durability shall not be required for fresh fr uits and vegetables.  To  our knowledge, no other 
country requires a “best before” date on perishable commodities.  What safety concerns is India 
trying to address with this measure?   
Reply:  The intention of labeling “best before” date is based on the consideration expressed by the 
experts that the surface coated fruits may underg o deterioration from inside while mainlining a 
superficial protective look from outside. 
How does India intend to enforce such a requi rement with respect to domestic produce?   
 
Reply:  This issue is under examination.  
 What steps is India’s Ministry of Health and Fa mily Welfare taking to align these requirements with 
international guidelines?  
Reply:  The Ministry of Health and Family Welfare is reviewing the issue of “best before” date.  
(xiii) Labeling 
 
In paragraph 65, page 56, the Secretariat repor t briefly mentions the proposed broad labeling 
requirement for genetically modified food. Given  the broad definition of biotech-enhanced food under 
this proposed amendment, what is India’s rational e for requiring biotechnology labeling, even if the 
end-product does not contain any genetically engineered material  and how will India be able to 
enforce such requirement?  
  WT/TPR/M/182/Add.1 
 Page 219 
 
 
  Why would India base labeling requirements on pr ocess of production, rather than on food safety 
considerations?   
 
Reply:  The approval of GM products is granted by the Genetic Engineering Approval Committee 
(GEAC) under the Ministry of Environment and Forest.  
 
 A labeling requirement, inter-alia covering GM i ngredients, has been stipulated so as to 
provide consumers with the right to have an informed choice. 
 
Page 80, Para. 139: The Secretariat’s report mentions that, in addition to direct subsidies, “transfers 
are made to state governments and by individual government ministries and agencies, including to 
state-owned enterprises and for research and development.”   -- What is the nature and scope of these transfers? 
 Reply:  In addition to the direct subsidies, transf ers are made to the State governments.  These 
transfers are either mandated in terms of the award of a Finance Commission or on the recommendations of the Planning Commission for suppor ting the plan priorities of the States or for 
schemes/programmes designed by the Centre and implemented by the States.  A transparent mechanism governs these transfers.  While the sch eme/programmes based transfers are specific to 
their implementation, others are in the nature of  general support.  These transfers are intended to 
improve the availability/delivery of key services like education, health, rural roads, income support or 
employment based programmes, etc, and reduce the disparities across the states and sections of 
society within a state.  
-- Please explain why these transfers are not subject to the notification obligation under Article 25 of 
the SCM.  Otherwise, please provide the relevant notification.   
Reply :  All subsidies as defined in paragraph 1 of  Article 1 of the Agreement on Subsidies and 
Countervailing Measures, which include transfers from  Government or any public body, were last 
notified in G/SCM/N/71/IND dated 19 October 2001, as further supplemented, the last supplement in 
respect of which is contained in G/SCM/ N/1/IND/2/Suppl.4 dated 3 November 2006. 
 
Insurance:  Paragraph 106 (page 131) states “Forei gn investment is restricted to 26 percent of total 
investment; an amendment to increase the restric tion to 49 percent is under consideration by the 
Government.”  Please provide an update on I ndia’s consideration of this amendment. 
 Reply :  It has been proposed to amend the Insura nce Act, 1938 which would inter alia, include 
amendments relating to the enhanc ement of FDI in Indian Insuran ce companies from 26% to 49%.  A 
draft bill is under consider ation of the government. 
 
(iii) Financial Services – Status of im plementation of FATF recommendations 
 
Banking:  Paragraph 99 (page 129) of the Secret ariat report describes gradual measures India is 
taking to lift restrictions on foreign banks. We not e that India has met its minimum WTO commitment 
by approving only 13 and 12 foreign branch licenses in the past two years.  We also appreciate the steps India is taking to improve its prudentia l requirements, based on recommendations from the 
Financial Action Task Force (FATF), as described in par agraph 122 (page 26) of India’s report.  
However, we are concerned that the Reserve Bank of  India is refusing applications for more foreign 
bank licenses in India due to Indian branch li censes put on hold until effective anti-money laundering 
provisions are in place. 
 
-- Will India extend national treatment considerati on to foreign banks applying for branches in India? WT/TPR/M/182/Add.1 
Page 220  
 
   
Reply :  The Central Government would follow the ro admap for the presence of Foreign Banks in 
India issued by the RBI and its existing commitments/revised offers under WTO.  
 
-- What is the status of India’s implementation of FATF recommendations for an effective anti-money 
laundering scheme?  
Reply :  India has been granted observership status in February, 2007 and the Indian delegation 
attended the FATF Plenary at Strasbourg, France in  February, 2007. Mutual Evaluation Process is 
likely to take place within the next one and a half years.  As per the FATF conditions, India is to be 
largely compliant with FATF recommendations within its  ship observer period of two years.  India is 
in the process of implementation of FATF recommendations.  In the meanwhile, the following have been done:-   (i) Prevention of Money Laundering Act has been brought into force with effect from 1 July, 
2007 and the rules have been framed thereunder; 
(ii) The Unlawful Activities (Prevention) Act tr eats  terrorist financing as criminal offence; 
(iii) 'Know Your Customer' guidelines have been i ssued by the regulators, i.e., Reserve Bank of 
India / Stock Exchange Board of India / Insurance Regulatory and Development Authority;  
(iv) Separate AML/KYC guidelines for exchange houses have been issued; 
(v) FIU has been set up and is fully operatio nal for reporting of suspicious transactions. 
 
(4) Measures Affecting Production And Trade  Page 79, paragraph 138:  Is India undertaking efforts to refor m its fertilizer subsidy policy?   
 Reply:  Reforms in the fertiliser subsidy policy  is a continuous process aimed at determining the level 
of subsidy with reference to the delivered costs and the capacity of the Indian farmers to pay for such 
inputs. The reforms are linked to the objective of achieving integrated nutrient management and the 
overall objective of food security. The subsidy policy would be directed exclusively towards assisting 
the Indian farmers who otherwise lack the economic/ financial capacity to use chemical fertilisers as 
required on the basis of soil/ crop . 
(iv) Telecommunications  
 Paragraph 115, page 133:  This paragraph indicate s that the Department of Telecommunications is 
responsible for policy formation and the granting of licenses.  
 
What role does the Department of Space play in the licensing of satellite services in India?  
Specifically, why must licensees obtain foreign spac e segments through the Department of Space’s 
domestic satellite system operator ISRO?  What are India’s plans to permit more flexible commercial 
arrangements? 
 Reply:  The  Department of Space(DoS) has no role to  play in the issue of a license.  The space 
segment is allocated to a licensee by ANTRIX Co rporation Limited /DoS as per the Satellite 
Communication Policy.  
 
Paragraph 118, page 134:  We co mmend India for increasing foreign equity limits from 49% to 74% 
in telecommunications services such  as international and domestic long distance calls.  Does India 
intend to bind these commitments in the WTO/GATS? 
 
Reply : India would take a decision on binding its au tonomous liberalisation depending on the quality 
of offers on all sectors and Modes (especially Modes 1 and 4) by other Members.  WT/TPR/M/182/Add.1 
 Page 221 
 
 
   
Paragraph 121, page 135:  Do es India’s Department of Telecommunications plan to revisit the 
Broadband Policy recommendations issued by the te lecom regulator TRAI in 2004, which advocated 
an Open Skies policy with respect to the u se of foreign satellites for VSAT services?  
 
We note that the Broadband Policy issued by the Department of Telecommunications in 2004 did not 
include such a provision.  
 
Reply:  Broadband Policy would be revisited as and when there is a need for in corporating changes.  
 
(vii) Tariff Preferences  
In several instances (page 44, paragraph 35; page  45, table III.2; page 121, paragraphs 69-70), the 
Secretariat report refers to tariff preferences provided by India to certain partner countries in the 
textile and apparel sector, indicating that the actual level of preference is low.  But the report does 
not provide a comprehensive list of which textile and apparel products are eligible for preferential 
access.  India is an important and potentially  large market for developing and least developed 
countries’ exports of tex tile and apparel products.   
 -- Please provide a comprehensive list of specific te xtile and apparel products that are eligible for 
preferential access into India under each of India’ s preference programs or regional agreements.  
Also, please list for each product the preferential rate of duty, qualifying rule of origin and any other 
conditions or limitations on preferential access.    What are the Indian government’s current plans to provide unilateral tariff preferences to least 
developed countries, in terms of specific produc t coverage in the textile and apparel sector, 
preferential rate of duty, qualifying rule of orig in and any other conditions or limitations on such 
access.  
 
Reply:  The details of tariff preferences provided by Indi a to certain partner countries are available on 
the website (www.commerce.nic.in) under the li nk Trade Agreement / Transit Arrangements. 
The Government is examining the issue of gr ant of unilateral tariff preferences to least 
developed countries (LDCs). The main objective of any such scheme would be to provide an 
integrated development assistance to help in  thei r economic development. No decision has been taken 
on the modality of introduction, ove rall product coverage, specific produc t coverage in the textile and 
apparel sector, preferential rate of duty, qualifyi ng rule of origin and any other conditions or 
limitations on such access. 
Q No. II (2) According to the Secretariat’s Repor t, India has introduced “duty-neutralising” 
measures in addition to measures existing at the time of the previous TPR.  These reportedly include 
“sectoral initiatives in agriculture…” and other products , such as footwear, that India has targeted 
for further export growth.  Please describe the nature of the new duty neutralising measures. 
 
Reply: With effect from 1
st September, 2004, Vishesh Krishi Upaj Yojana has been notified primarily 
for the export of  agricultural products.  It was replaced by the  Vishesh Krishi and Gram Udyog 
Yojana with effect from 1 April 2006.   For the foot wear sector, the initiatives taken are in the form of 
enhancement of the duty free entitlement for impor t of components, packing material, etc. The 
entitlement for trimmings and embellishments (for ha ndloom and handicrafts sectors) and for samples 
have also been increased.  Duty free import of mach inery and equipment for effluent treatment plants 
have been allowed for the leather and footwear, ha ndlooms and handicrafts sectors.  For the Gems and 
Jewellery sector, initiatives taken are in the form of enhancement in the entitlement of duty free 
import of commercial samples and the consum ables required for the industry.      WT/TPR/M/182/Add.1 
Page 222  
 
   
Q No III (2) (i) The report states that all importers and exporters must obtain an importer-exporter 
code (ICE) number from the Director General of Foreign Trade (DGFT) in order to conduct 
business.  Are there restrictions on who may apply to  be an authorized importer/exporter and receive 
an ICE number?  What criteria does the DGFT use to authorize and issue an ICE number?  Please 
describe the process that a company or individual  must follow in order to receive an ICE number.  
 
Reply: There is no restriction on who may apply for an Importer –Exporter Code (IEC). IEC is issued 
based upon criteria that only one IEC will be issued against a single Permanent Account Number (PAN) issued by the Income Tax authorities in Indi a. The IEC is issued to the importer/exporter on 
making an application to various offices of the Di rectorate General of Foreign Trade in the format 
specified in the Handbook of Procedures, Volume 1 along with submission of the necessary fee of 
Indian Rupees 1000, copy of the Permanent Account Number of  income tax and proof of maintaining a bank account.  
 
Q No III (2) (v) Paragraph 33 on page 44 of the Secretariat’s repor t provides a brief description of 
India’s tariff rate quotas.  The paragraph also stat es that certain quotas are issued “on the basis of 
requests from designated agencies.”  --  How does India determine which agencies are allowed to request quotas?   
--  Please identify these “designated agencies.” 
 The paragraph highlights that, although there appear  to be no quotas assigned for certain products 
(milk powder, for example), imports ha ve occurred at out-of-quota rates.   
 
-- Why does this happen and why are the quotas  for these products not being allocated?  
 -- Our traders advise that quota announcements are often delayed as a matter of procedure.  How 
does India currently announce and allocate quotas?   What steps has the Directorate General of 
Foreign Trade considered to improve quota allocation?   
Reply: All eligible entities desiring to avail the quota as mentioned above, may make application to 
Directorate General of Foreign Trade based on the requests or expression of interest (which is market driven) received from desirous importers. There is no delay in announcing the quotas. Further details 
of the TRQ administration are available at the website www.dgft.gov.in 
 
Q No III (2) (ix)  
 Please provide a complete list (HS-8 digit level) of India’s current import restrictions under Article 
XX and XXI? and Outside of restrictions under Arti cle XX and XXI, what other import restrictions 
does India currently maintain?    
Reply: The items which are restricted for imports are available in the ITC (HS) Classifications of 
Export and Import Items, 2004-09 which is av ailable at the website www.dgft.gov.in.  No other import 
restrictions outside Article XX and XXI are being maintained by India. 
 
Q No Pg 47 Para 40 : “Imports of certain ite ms, including second-hand cars (over three-years old) 
and imports from Sri Lanka subject to preferential tariffs (such as tea), must be imported through 
specified ports (Mumbai for second- hand cars, Kochi and Kolkata for tea and Chennai, Mumbai and 
Jawaharlal Nehru Port Mumbai for garments)”.    WT/TPR/M/182/Add.1 
 Page 223 
 
 
  --Please clarify whether the requirement to im port through specified ports  (Chennai, Mumbai and 
Jawaharlal Nehru Port Mumbai) applies to all garment s from all sources, or only garments from Sri 
Lanka subject to preferential tariffs.    -- In either case, what is the rationale for such a requirement? 
 Reply: The requirement to import garments and tea th rough specified ports is only in respect of 
imports from Sri Lanka. 
 
Q No Pg 47 Para 40: the Secretariat report indicat es that India also monitors imports of about 300 
items considered “sensitive.” 
 -- How does India define “sensitivity” and what becomes of products so defined?  What guidelines or criteria does India use to de termine whether or not an item is “sensitive”? 
 
-- Is there an open process?  Is the public allowed to participate in the process?  
 -- How often are products on the “sensitive” list r eviewed?  Are they ever re moved from the list?  
What is the process for seeking and obtaining removal of a product from the sensitive list? 
 
Reply: The list of sensitive items mainly contains ag ricultural products. Agriculture is an extremely 
sensitive area given the fact that the livelihood of a sizeable population depends on it. Products which 
figure on the sensitive list are monitored to ascertain  whether there has been a surge in imports. The 
list was compiled at the time of removal of quantita tive restrictions in 2001.  Very  few items have 
since been added to the list . The inclusion or remova l of  items is considered by an Inter-Ministerial 
Group (IMG) chaired by the Commerce Secretary.   Q No. 3 According to the report, the Advance Au thorisation Scheme and th e DFIA Scheme require 
“positive value added” and “minimum value added of 20%” in exports.  Please explain how it is determined that these requirements are met. 
 
Reply:   At the time of discharge of export obligation,  an exporter has to provide the shipping bills 
(evidencing physical export of goods) and bank realisation certificate (e videncing realis ation of export 
proceeds).  Both these documents along with import deta ils, if any, are taken into account to calculate 
the positive value addition incase of advance author isation and a minimum value addition of 20% in 
case of Duty Free Import Authorisation Scheme. The value addition formula is given in paragraph 
4.1.2 of FTP.    
 
Q No Page 123 paragraph 78:  Please provide deta iled information about (1) India’s export credits 
for steel and (2) how steel exports benefit from  the Advance Authorization Scheme and Duty 
Entitlement Pass Book Scheme.  How will the governme nt help steelmakers redu ce the “high cost of 
capital resources”?   
Reply: Exporters are entitled to duty free inputs requi red for the manufacture of export products 
under the Advance Authorisation scheme. Inputs are allowed as per Standard Input Output Norms 
(SION) and as a measure of double check on the actua l consumption, exporter is required to furnish a 
consumption register in Appendix 23 duly veri fied and signed by a Chartered Accountant. 
 
 Under Duty Entitlement Passbook scheme, exporters are entitled for a refund of basic 
Customs duty on the inputs used in the export product at a specified rate arrived by a technical Committee (DEPB Committee) for the purpose.  WT/TPR/M/182/Add.1 
Page 224  
 
  (3) T
RADE AGREEMENTS AND ARRANGEMENTS  
  
(ii) Regional Trade Agreements   
 
Pages 24-25, Table II.1:  We thank India for T able II.1, summarizing its current commitments under 
regional trade agreements.  In addition, we comme nd India for the transparency of its Department of 
Commerce website, on which many of  its RTAs can be found.  However, of the nine arrangements 
listed in the table, India has notified only four  to the WTO (SAFTA, APTA, Sri Lanka and Singapore).  
When does India plan to notify the remaini ng five of its agreements to the WTO? 
 
Reply:  The Global System of Trade Preferences (GSTP)  has already been notified to the WTO in 
1989. The Agreements which are under negotiati on (BIMSTEC and Thailand) will be notified 
oncethe negotiations conclude. The process of notifying SAFTA to  the WTO has already been 
initiated. 
 
(xiv) Government Procurement  
 Regarding paragraph 78 on Page 2 23 of the Secretariat’s report: 
 
--Is India considering becoming an observer in th e WTO Committee on Government Procurement? 
  --Does India have plans or a timetable for comme ncing its accession to the WTO Agreement on 
Government Procurement?   
Reply :  The issue of India’s accession to the GPA is under examination. At present a firm 
commitment on this issue is not possible  
REPLIES TO FOLLOW-UP QUESTIONS
 
 
Trade Policy Regime/Trade Policies and Practices 
 1. We appreciate the written responses that India gave on Wednesday, to the questions that we 
submitted in advance of this meeting.  We would li ke to clarify one of the questions that we asked 
previously:    
 
"As there is no applicable tariff on domestic prod ucts, it would seem that the additional duty on 
imported goods is calcul ated on a different -- and larger -- ba se than is the excise duty on domestic 
goods.  If this is true, how does India ensure that  the effective rates of the additional duty and the 
excise duty are the same when applied to  the same classification of product?" 
 
Reply: Additional duty on imports in India, is charged on landed cost, which is c.i.f. value plus the 
tariff.     This is also the practice followed by other countries.  For example, in the U.K. VAT on 
imports is charged on value inclusive of customs duty or tariff payable on imports along with excise 
duty or other charges paid on such imports.  The details can be obtained from the website of HM 
Revenue and Customs at http://customs.hmrc.gov.uk. 
 
2. We also appreciate the website link that I ndia supplied in response to our question at the 
bottom of page 136 of India’s written answers to Me mbers’ questions.  The website link that India 
supplied does not seem to include several of the prog rams listed in the Secretariat report.  Also, for 
several of the programs that are listed in the Secretariat report and/or available on the website, 
information concerning product coverage, rules of origin , preferential rate of duty, conditions, etc. is  WT/TPR/M/182/Add.1 
 Page 225 
 
 
  not evident.  Please provide the information so that we can understand India’s preferential 
arrangements.  
Reply:  India does not maintain a comprehensive list of the textile and apparel products that are 
eligible for preferential access. The products on wh ich concessions have been offered as well as the 
tariff concessions extended vary from agreement to ag reement. This information along with the text of 
the agreement and the time schedule for tariff liber alization is available at the web-site of the 
Department of Commerce. The Secretariat Repor t lists in Table II.1 India’s commitments under 
regional trade agreements. This table is based on the information that has been taken from the 
Department of Commerce web-site. The customs exemption notifications for various tariff 
preferences can be found at the web-site of  the Central Board of Excise and Customs. 
(http://www.cbec.gov.in/customs/cs-act/notifications/cs-notfns-idx.htm)  
 
3. We do not see an answer to the second part of the question at the bottom of page 138/top of page 139 of India’s responses to Members’ questions.  We would like to request India to respond to 
this question. 
 [Question is reproduced for convenience:  Q No Pg 47 Para 40 : “Imports of certain ite ms, including second-hand cars (over three-years old) 
and imports from Sri Lanka subject to preferential tariffs (such as tea), must be imported through 
specified ports (Mumbai for second-hand cars, Koch i and Kolkata for tea and Chennai, Mumbai and 
Jawaharlal Nehru Port Mumbai for garments)”. (DGFT) 
 
--Please clarify whether the requirement to impor t through specified ports  (Chennai, Mumbai and 
Jawaharlal Nehru Port Mumbai) applies to all garme nts from all sources, or only garments from Sri 
Lanka subject to preferential tariffs. 
 -- In either case, what is the rationale for such a requirement?] 
 
Reply: The requirement to import garments and tea thr ough specified ports is only in respect of 
imports from Sril Lanka. 
 
The rationale behind such a stipulation is for better monitoring of imports. 
 
4. On page 124 of India’s responses to Memb ers’ questions, in response to our question for 
Page 44, paragraph 34 starting "The report notes that differences remain betw een the special duty...", 
India mentions that an "octroi" is levied by m unicipalities on entry of goods. Please explain the term 
"octroi" and further clarify the intention of municipalities to levy an "octroi" on goods. 
 Reply:  Under the Constitution of India, the powers of taxation are divided between the Union 
(Central Government) and the States.  The taxation powers of the Union are in the Union List (List-I), whereas the powers of States are in the State List (L ist-II).  The States have the powers to delegate 
their taxation powers (specified in the State List ) to the Local Bodies (viz. urban and rural local 
bodies). One of the taxation powers of the States is to levy “Taxes on entry of goods into a local area 
for consumption, use or sale therein”, which is specified in Entry 52 of State List.  This tax is 
generally referred to as Octroi or Entry Tax.  This tax is levied when goods enter the area of a local or 
Municipal Body to enable it to discharge its func tions.  The manner of administration of this tax 
varies from State to State.  In some States, the tax is collected by the Local or the Municipal Body and 
the proceeds are retained by them , whereas in some other States, the State Governments collect this 
tax, the proceeds being deposited in the Consolid ated Fund of the State from where the same are 
allocated to the Local Bodies to enable them to meet their fund requirement for developmental work. 
 WT/TPR/M/182/Add.1 
Page 226  
 
  Regarding Intellectual Property: 
 Patents
 
 5. India’s response to the first question on patents  refers to Section 3(d) of the Patents Act. 
Please elaborate on how Section 3(d), in preventing the "grant of frivolous patents for new forms or 
new usages of known substances," falls within the three categories for determin ing patentability; i.e., 
novelty, inventive step, and industrial applicability. Furth er, this response also states that Section 3(d) 
applies to pharmaceutical products. Please elaborat e on whether and how this provision applies to 
other fields of technology.  
 Reply: The TRIPS Agreement obligates Member States to provide patent protection to any invention, 
whether product or process in all fields of technology.     However, such a provision has to be read w ith the other provisions of the TRIPS Agreement. 
For example, Article 7 of TRIPS provides that pr otection and enforcement of intellectual property 
rights should contribute to the promotion of technological innovation and to the transfer and dissemination of technology to the mutual adva ntage of producers and uses of technological 
knowledge and in a manner conducive to social and economic welfare and to a balance of rights and 
obligations.    
 Section 3(d) as it stands now intends to prev ent the grant of patents which are frivolous and 
could be obtained by minor modifications, particul arly in the pharmaceutical and chemical sectors, 
besides covering other fields of technology.  It thus promotes grant of patents which involve real 
inventive steps in all fields of technology.  
 This provision is also in consonance with  Article 8 of the TRIPS Agreement which, inter-
alia, recognizes that appropriate measures may be need ed to prevent the abuse of intellectual property 
rights by the right holders.  
Copyrights
 
  
6. We continue to have questions about whether a compulsory license can be issued under 
Section 31 and 31A for a US produced work if that  work is published in India within 30 days of 
publication in another territory.   
Reply: Section 31 applies only to Indian work as defined in Section 2(l). According to Section 2 (l) 
the term “ Indian work” is to mean a literary, dramatic or musical work- (which would include 
Artistic work and Cinematograph film or a sound re cording, made or manufactured in India, while 
read with the explanation given in Section 31)  (i) the author of which is a citizen of India; or 
(ii) which is first published in India; or 
(iii) the author of which, in the case of an unpublishe d work, is at the time of making of the work, 
a citizen of India 
  This definition also covers such works, the aut hor of which is not a citizen of India but which 
for the first time has been published in India. S ection 31 of the Copyright Act, 1957 (as amended from 
time to time) describes the steps required to identify the copyright holder before a compulsory licence 
is issued for works withheld from the public. The Copyright Board is  empowered to grant compulsory 
licences under certain circumstances as enumerated in Section 31 on suitable terms and conditions in 
respect of an “ Indian Work”.   WT/TPR/M/182/Add.1 
 Page 227 
 
 
   A work published in India is deemed to be firs t published in India. According to Section 5 of 
the Copyright Act, 1957, this is so even if it has been published simultaneously in some other country 
unless such other country provides a shorter term of copyright for such work. A work will be deemed to have been published simultaneously in India and in another country if the time between the 
publication in the two countries does not exceed thir ty days. The Central Government may determine 
another period in relation to any specified country. This is in accordance with the provisions of the 
Universal Copyright Convention 1952 signed at Geneva to which India is a signatory.   As far as the issuance of a compulsory licen ce for a US produced work under Sections 31 and 
31A is concerned, these sections must be read togeth er with Section 2(l) and Section 5 of the Indian 
Copyright Act, 1957 which signify that if a person is not a citizen of India, the work must be first 
published in India to attract the provisions of th e above said sections of the Copyright Act, 1957. 
Further, a work will be deemed to  have been published si multaneously in India a nd in another country 
if the time between the publication in the two c ountries does not exceed thirty days. If any question 
arises as to whether a work has been published or  as to the date on which it was published or whether 
the term of the Copyright for any work is shorte r in any other country than that provided under the 
Copyright Act, 1957, it must be referred to the Copy right Board whose decision will be final. (Section 
6 of the Indian Copyright Act, 1957)   The Copyright Board being a quasi-judicial body follows the principles of natural justice and 
its powers and procedures are laid down in Section 12 of the Act. It decides on matters in a judicious 
manner, providing an opportunity to all concerned to agitate their legal rights. 
 
Please explain if and when Sections 31 and 31A would apply to US produced works.   
 
Reply: Read in the light of Section 2 (l) (ii) of the Indian Copyright Act, 1957 which defines what is 
classified as an Indian work, together with Secti on 31-(Explanation) and Section 5 of the Act, the 
provisions of Sections 31 and 31 A can be invoked in the case of US produced work if and when a 
work published in India is deemed to have been firs t published in India. This is so even if it has been 
published simultaneously in some other country unless  such other country provides a shorter term of 
copyright for such work. A work will be deemed to  have been published simultaneously in India and 
in another country if the time between the publi cations in the two countries does not exceed thirty 
days. 
  It may be noted that any claim for a U.S.  produced work for a compulsory licence under 
Section 31 A can be made by any person only if th e author of the work is dead, unknown or cannot be 
traced or the owner of the copyright in such wo rk cannot be found. Therefore, in each case under 
section 31A, before arriving at a decision on compulso ry licencing, the Copyrigh t Board has to satisfy 
itself that the situation of the facts about the owner of the copyright has been ascertained. The 
Copyright Board would act with due diligence in this matter. In addition, attention may also be drawn 
to Section 40 of the Act under which any provisions of the Indian Copyright Act, 1957 shall apply to foreign works as well, thereby protecting the copyright  of certain foreign authors and of works first 
published in any territory outside India. 
 
In addition, as previously noted, we would like to know how many licenses have been granted by the 
Registrar of Copyrights pursuant to Sections 31 and 31A in the last 5 years.  Of those licenses granted, please provide information as to the types of works, uses of works sought by complainants, 
and any additional information on how these licenses are granted.  
 Reply: Sections 31 and 31 A deal with compulsory licence in works withheld from the public and 
compulsory licence in unpublished In dian works respectively. The Re gistrar of Copyrights has not 
issued any licence pursuant to these Sections in the last 5 years. 
 WT/TPR/M/182/Add.1 
Page 228  
 
  Trademarks
 
 7. We continue to have questions regarding th e relationship between geographical indications 
and prior registered trademarks.  It appears that  a registered trademark may only be protected 
against a later-in-time geographical indication if the trademark were registered before September 15, 
2004, i.e. the date the Geographical Indications Act (GI Act) came into effect.  Please clarify whether 
a trademark registered after the implementation of th e GI Act will have priority over a later-in-time 
geographical indication.  Reply: 
¾ The Geographical Indications (Registration & Pr otection) Act, 1999 (GI Act) came into force 
on 15.09.2003. 
¾ No trademark containing or consisting of a GI can be registered as a trademark after the 
coming into force of the GI Act. 
¾ A trademark containing a GI which has been regi stered as a trade mark prior to 15.09.2003 is 
vulnerable to being removed from the Register of Trade Marks for a period of five years from 
15.09.03 on the ground that it has been wrongly registered as a trademark. 
¾ Therefore, all trademarks, even if they contain a GI, entered in the Register of Trade Marks, 
will be deemed to have been properly register ed after 15.09.08 and su ch trade marks cannot 
be expunged on the ground that they contain or consist of GIs.  Such trademarks will have 
priority over a GI application filed later in time. 
 Trade Policies by Sector  8. Please provide a copy of the Satellite Comm unications Policy to which India refers, in  
response to our question in Paragraph 15, page 133.  
 
Reply: The salient features of the SATCOM policy are: 
 
(a) Transponder capacity on INSAT system would be offered to non-Governmental users 
also on commercial terms subject to capacity availability, 
(b) Indian Private Parties will be permitted to  establish commercial communications satellite 
and the Parties will be assisted in registeri ng such satellite systems and networks with the 
International Telecommunications Union (ITU) as Indian satellites and, 
(c) Operations from Indian soil will be allowed with both Indian and foreign satellites in 
accordance with the norms and conditions, but Indian satellites will be accorded 
preferential treatment.  In so far as satellite based broadcasting is concerned, the various 
provisions of SATCOM Policy Framework would conform to the proposed Broadcasting 
Law. 
(d) The Department of Space (DOS) will be the Administrative Ministry on all matters 
related to satellite systems in India. 
(e) The DOS will allocate INSAT capacity for privat e users.  DOS may also build capacity in 
INSAT system for private users on request on commercial basis. 
(f) Private Indian Companies with a foreign e quity less than 74% are allowed to establish 
Indian satellite systems.  These companies can  submit their applications for registering 
their satellite systems to the Committee for au thorizing the establishment and operation of 
Indian Satellite Systems (CAISS) 
 9. We understand from India’ s response on paragraph 37 page 46, and Table III.4 that it 
currently maintains no import prohibition on agricu ltural products on the basis of “prevention of 
agricultural surpluses.”  However, paragraph 37 on page 46 of the Secretariat report indicates that 
India can impose import prohibitions for “preventio n of agricultural surpluses” as established under 
the Customs Act 1962.  Please explain  how this practice operates.    WT/TPR/M/182/Add.1 
 Page 229 
 
 
  Reply:  Section 11(2) (g) of the Customs Act 1962 empowers the Government to impose import 
controls for the purpose of prevention of surplus of  any agricultural product or products of fisheries. 
This provision is available for use in extraordinar y situations. No product has been notified under this 
provision.  
Imports of agricultural commodities are regulated through appropriate WTO compatible measures.  
 
10.  In its replied to our question on paragraph 57 on page 54, India stated that the Food Safety 
and Standards Act, 2006 will “consolidate different exis ting laws relating to food.”  Please provide a 
detailed list of the food safety laws that  will be consolidated under this act.  
 
Reply: The Food Safety and Standards Act, 2006 will consolidate differe nt existing laws relating to 
food, which are as follows-  
1. The Prevention of Food Adulteration Act, 1954 (37 of 1954). 
2. The Fruit Products Order, 1955. 
3. The Meat Food Products Order, 1973. 
4. The Vegetable Oil Products (Control) Order, 1947. 
5. The Edible Oils Packaging (Regulation) Order, 1998. 
6. The Solvent Extracted Oil, De oiled Meal, and Edible Flour (Control) Order, 1967. 
7. The Milk and Milk Products Order, 1992. 
8. Any other order issued under the Essential Commodities Act, 1955 (10 of 1955) relating 
to food. 
 
11. Our read of the Food the Food Safety Standards Act as viewed on the website 
(http://mofpi.nic.in/fsnstds.pdf) indicates that th e FSSA will be under the authority of the Central 
government with Chapter II item 5(a) establishing a list of Ministries that will participate as 
members.  Can India confirm that the FSSA will be an independent entity with jurisdiction going 
across Ministries?  
 
Reply: As per section 4 of the Food Safety and St andards Act, 2006 the Central Govt. shall by 
notification establish a body to be known as the Food Safety and Standards Authority of India. This 
Food Authority shall be a body corporate by the name  Food Safety and Standards Authority of India. 
Though it will have members from various Ministries, it shall work independently under the Ministry of Health and Family Welfare, which is its noda l ministry. The said authority shall consist of a 
chairperson and twenty two members, out of whic h one third shall be women. The members of the 
Food Authority shall be from different Ministries, the food industry, consumer  organizations and from 
other organizations like the chambers of commerce,  retailers, food technologists, scientists etc.  
 
12. Section 16 of the Food Safety Standards Act lis ts the activities that will be assigned to the 
FSSA. However, regulation of biotech foods, feeds, and seeds, is not listed as a FSSA responsibility.  
Can India confirm that the FSSA will not have oversight in the area of biotech?  13.  The Ministry of 
Environment and Forests is not listed as member Mini stry of the FSSA, what will be the relationship 
of the FSSA with the Genetic Engineering A pproval Committee (GEAC) in the development and 
oversight of new biotech regulations?  
Reply: Biotech food is not mentioned in the list of  activities of the Food Safety and Standards 
Authority of India as per section 16 of the Food Safe ty and Standards Act, 2006. However, section 22 
of the said Act deals with genetically modified food s, organic foods, functional food, proprietary food 
etc. and regulations may be framed under th e said Act to deal with such foods.  
 WT/TPR/M/182/Add.1 
Page 230  
 
  13. The Ministry of Environment and Forests is not  listed as member Ministry of the FSSA, what 
will be the relationship of the FSSA with the Ge netic Engineering Approval Committee (GEAC) in the 
development and oversight of new biotech regulations? 
 
Reply:  Section 11 of the Food Safety and Standards Act, 2006 provides for the establishment of a 
Central Advisory Committee. This Committee is to advise the Food Authority on various issues 
relating to food standards and safety. Representatives of the Ministry of Environment and Forests can 
be invited to the deliberations of this Central Advisory Committee.  
 
Further, the Food Authority is required to estab lish Scientific Panels on genetically modified 
organisms and foods. These panels would provide scien tific opinions to the Food Authority, and also 
organize public hearings to arrive at their reco mmendations. Thus an appropriate basis has been 
provided to frame regulations on genetic ally modified organisms and foods. 
 
Also, though the Ministry of Environment and Forest is not listed currently as a member 
Ministry of the FSSA, provisions to include the Genetic Engineering Approval Committee (GEAC) 
may be made subsequently if there is a need to do so.  14. In its response on paragraph 40 on page 47, India highlighted that products on the 
“sensitive” list are monitored for surges in imports.  Can India explain what actions are taken in the 
event that a surge in imports does occur?  To date, has India made any government intervention 
against sensitive products whose imports increase beyond a certain level? If so, what was the form of intervention and how does India alert suppliers with substantial interest?  
 
Reply: Appropriate corrective actions are taken in cases warranting a change due to a sudden surge in 
imports and other situational factors. These changes are mainly in the form of tariff changes. These 
changes are notified from time to  time and are available on the Customs website www.cbec.gov.in 
and DGFT website www.dgft.gov.in.   
 
REPUBLIC OF KOREA
 
 
1. Tariff Structure  (WT/TPR/S/182 pp.39~40 para.25, p.98 Annex III.1) 
 
The Indian government levies additional duties and special additional duties over and above the normal customs duties. There are so me cases wherein the sum of those duties is higher than the bound 
duty rate of India to the WTO.  
 The argument put forward by the Indian government in favor of the imposition of these additional and 
special additional duties is that, while the former are levied as a compensation for domestic excise 
duty from which imported products are exempted, the latter are charged in order to bring the overall 
tax burden on domestic products in lin e with that of imported ones.  
 However, as the Secretariat report pointed out, the special additional duties are "not harmonized with 
internal taxes, making it unclear to what ext ent the taxes on imports and on domestic goods are 
equivalent". In addition, it is not yet clear whether exactly the same rate of additional duty is applied 
on the imported products as that of the excise duty on like domestic products. 
 
(1) What is the basis of the specific 4% special additional duty?  (2) How does the Indian government ensure that  both domestic and impor ted products have the 
same tax burden with the system of th e additional and the special additional duty?  WT/TPR/M/182/Add.1 
 Page 231 
 
 
  (3) What is the Indian government's position on reforming the current additional and special 
additional duty system into a more WTO consiste nt one of imposing the same domestic tax on 
both domestic and imported products? If such reform is difficult, what is the reason?  
 Reply: Special additional duty of customs, commonly kn own as special CVD, at the rate of 4% has 
been levied on imported goods to counter balance the internal taxes such as sales tax, value added tax, 
local tax or any other charges leviable on a like artic le on its sale, purchase or transportation in India. 
 
 The intention of the Government is to safegua rd the interests of indigenous industry, which 
suffers from various taxes levied and collected by th e States. The levy of special CVD is to counter 
the impact of such taxes.  To illu strate, taxes levied on such goods by various agencies other than the 
Central Government are:  
(a) CST on inputs procured from other States. 
(b) CST on products sold in other States. 
(c) Octroi levied by Municipalities on entry of goods. The rate of octroi varies from 2.5% 
to 5.5%. This is applicable on in puts needed by the industry also. 
(d) Electricity duty levied by the State Governments on consumption/sale of electricity, 
which is one of the inputs for manufacture of  goods. Rate of electricity duty varies 
from State to State. 
(e) Sales tax on petrol/diesel – No credit. 
 These taxes are in addition to general St ate VAT which varies between 4% - 12.5%. 
 
 In India, no set-off is available for the CST on inputs, octroi on inputs, electricity duty and 
sales tax paid on auto fuels.  Total of these intern al taxes depends upon the location of an industry and 
type of goods it manufactures. Special additional dut y is charged only at 4%, which is the minimum 
rate. The incidence of internal taxes borne on dom estic product are much higher than the Special CVD 
rate of 4%. 
 
2. The Corporate Tax  
 (WT/TPR/S/182 pp.76~77 para.126~128) 
 
In India, the corporate tax deduction rate at the source is applied differently for Indian and foreign 
companies. The rate is fixed for Indian companies in the Income Tax Act but is not clearly defined for 
foreign companies. Accordingly, the tax offices in I ndia apply different tax rates at their own accord 
for foreign companies. In many cases, the deducti on rate applied to foreign companies is far greater 
than that for the Indian companies. 
 
Such arbitrary application by the tax offices lowers the foreign com panies' ability to forecast their 
cash flow and profitability and makes their business pl ans very unpredictable. In addition, the unfair 
large number of deduction rates bring about huge financial costs. 
 
(1) Korea requests the Indian government to introduce a uniform corporate deduction rate 
system and incorporate it into the Income Tax Act for both Indian and foreign companies. What is the 
view of the Indian government on this request? 
 
(2) The corporate tax rate for Indian compani es in the fiscal year 2007-2008 is 30%, whereas 
that for foreign companies is 40%. The different application of corporate tax rates is discriminatory 
treatment to foreign companies, and therefore, contrary to the WTO rules. Does the Indian 
government have any plans to intr oduce uniform corporate tax rat es for both Indian and foreign 
companies alike? WT/TPR/M/182/Add.1 
Page 232  
 
  Reply: 
 
1. Tax deduction on payments made to Non Re sidents/foreign companies are governed by 
section 195 of the Income Tax Act.  The rates at wh ich the deduction is to be carried out are clearly 
spelt out in Schedule I, Part 2 of the Finance Act ev ery year.  Thus, it is not correct to say that the 
rates are not clearly defined for foreign companies.   
  Secondly, the rates for deduction of tax are generally higher in case of payments to foreign 
companies vis-à-vis Indian companies for the si mple reason that withholding tax may be the only 
mode of collection on payments made to foreign concerns.   
 
2. (i) Domestic companies are taxed on their global income, whereas foreign companies are taxable 
only on their Indian source income.  Further, fo reign companies are eligible to claim benefits 
under the Double Taxation Avoidance Agreements, the terms of which are more beneficial 
than the provisions of domestic law.  
(ii) A domestic company is liable to pay Dividend distribution tax (DDT) at the rate of 15% 
(exclusive of surcharge and education cess), wh ereas a foreign company is not liable to pay 
such tax in India.  
(iii) The rate of surcharge for domestic companies is higher at 10% as against 2.5% for foreign 
companies.  
(iv) Foreign companies enjoy special concessionary rates on certain specified incomes, which are 
taxed on gross basis, under different provisions  of the Income-tax Act, including:    
a. Royalty or fees for technical services rece ived from Government or any Indian 
concern under an agreement entered into on or after the 1
st day of June, 2005 (10%) 
b. Interest on bonds of Indian company issued under a notified scheme or bonds of 
public sector company sold by Government  and purchased in foreign currency (10%) 
c. Dividends on Global Depository Receipts (10%)  
 
3. Export Subsidy  
 
(WT/TPR/S/182 p.77 para.129)  
 
It is our understanding that the Indian government  maintains the EPCG (Export Promotion Capital 
Goods) Scheme, which allows a lower rate of tar iff for capital goods imported by the companies who 
have met certain export targets for a specified peri od. It also has the DEPB (Duty Entitlement Pass 
Book) Scheme, which exempts tariffs on raw material imports for export.  
 These schemes appear to be inconsistent with the WT O subsidy rules, which prohibit export subsidies. 
What is the position of the Indian government on the inconsistency of these measures with WTO 
rules?  
Reply: The schemes are not inconsistent with the WT O rules .They only seek to neutralise duties and 
levies to ensure that taxes are not exported . 
 
4. Anti-dumping Measures:  Trade Remedy Policy  
 (WT/TPR/S/182 pp.48~50, WT/TPR/G/182 p.32) 
 
According to para 44 of the Secretariat's report, India has initiated a total of 176 anti-dumping investigations since 2002 (as of June 30, 2006). Furthermore, India undertook a total of 171 final 
anti-dumping measures since 2002 (as of June 30, 2006) , which places India near the top of the list of 
countries that frequently resort to such measures.  WT/TPR/M/182/Add.1 
 Page 233 
 
 
  Contingency trade measures should be taken to prot ect domestic industries from unfair foreign trade 
practices in exceptional cases. Moreover, given that the initiation of the investigation will affect the 
business activities of the investigated exporters by  imposing an additional burden, more prudential 
approach is required in initiating such investigations.   
 Korea also requests that these cases be handl ed in a more transparent way and with due 
consideration of consumers' interest. 
 
Korea is concerned about India's frequent anti-du mping measures. As such, Korea hopes that India 
will review and improve the anti-dumping related system.  
Reply:  India’s anti-dumping actions are initiated based  on petitions by the domestic industry. The 
Designated Authority undertakes anti-dumping proceedi ngs in an objective and  transparent manner 
based on the criteria/parameters as defined in the Agreement on Anti-Dumping of the WTO. 
 
5. Labeling  
 
Although India liberalized its regulations on impor ts in 2001 the Indian government‘s requirements 
regarding labeling of imported goods have expanded.  the Standards of Weights and Measures Rules 
of 1977 has been applied to all imported retail goods since that time. 
 Current Indian Government regulations require export ers to attach a label including information on 
the product and importer to products before they ar e exported .Specifically exporters must include 
the maximum retail sale price taki ng into consideration anticipated exp enses accrued in India such as 
customs duty domestic taxes additional charges ma rketing and distribution expenses as well as 
importers name address product name quantity and date of packaging.   These requirements place an undue burden on export ers . Because the maximum retail price marked 
on the product is considered the actual retail sale price , calculating the price is time consuming and 
requires exporters to employ additional resources.  
 
Does the Indian Government plan to harmonise its labeling requirements with the international 
standard which demands only a reas onable amount of information?   
 
Reply:  The current provisions of the Standards of  Weights and Measures (Packaged Commodities) 
Rules ,1977 does not stipulate that exporters in other countries have to attach a label to the packages 
to comply with the Rules. The onus to comply with the Rules rests on the importer of packages . It is 
for the importer to ensure that th e packages comply with the provisions  before they are cleared at the 
port.  The Rules are applicable equally to indigenously manufactured  packages as well as imported packages.   
The import consignments of pre packaged commodities need to carry information on 
name/address of importer, generic or common name of the product, quantity in standard units of 
measurement, month/year of packing and maximum reta il price of the product at which it is to be sold 
to the consumer. All these requirements are in li ne with the domestic regulations to which the 
domestic industry is also required to comply.. It is necessary that sufficient information is made 
available to the consumer to enable him to make  a purchase decision and he is charged a reasonable 
price for the product. The maximum retail price at whic h the product will be sold in Indian markets is 
to be supplied by the Indian importer and may not place onerous responsibilities on the exporter in terms of deploying additional resources to fulfill  this requirement. In our view, the labeling 
information requirements stipulated are reasonable and justified. 
 WT/TPR/M/182/Add.1 
Page 234  
 
   The declaration of retail sale price in the form  MRP ..Rs..  (Inclusive of all taxes.) is to  
continue from the stand point of consumer protection.   
6. Delays in permitting Branch Offices 
 
(WT/TPR/S/182 p.30 para.40~43) 
 
Many Korean companies interested in making investm ents in India establish their branch offices or 
liaison offices in India as a preparatory step. 
 
The procedure to establish a branch office in In dia is lengthy and time consuming. In order to 
establish those offices, foreign companies should ge t permission from the RBI and the Reserve Bank 
of India. Normally the RBI, before providing perm ission, requests the opinion of the Indian Ministry 
of Finance (MOF), and the MOF in turn requests opinions from relevant Ministries including the Ministry of Home Affairs and the Ministry of Commerce. 
 
Thus, investing companies face huge problems in setting their investment plans in India due to lengthy 
delays, sometimes as long as 10 months. 
 
Does the Indian government plan to introduce a sc heme to enhance the predictability of business 
activities in India for foreign investors? 
 
Korea suggests the following scheme: A certain time limit should be fixed to complete the process, 
and if it is difficult to meet this tim e line due to the need for further in vestigation, this fact should be 
communicated to the relevant compani es with the reason for the delay. 
 
What is the view of the Indian government on this suggestion? 
 
Reply: The opening of Branch/Liaison offices by a forei gn company requires the prior approval of the 
Reserve Bank under the provisions of Section 6(6) of FEMA The criteria for opening such offices by 
the foreign company is finalized in consultation with  the Government and it is decided that in certain 
activities/sectors, the requests are to be considered in consultation with the Government Departments. 
Such requests are referred to the Ministry of Fina nce and some delays do occur when the various 
Ministries are involved.   
The suggestion of the Government of Korea would be taken when a review is undertaken of the 
matter.    Where a request is being dealt with in consultation with the Government, an interim reply  is being 
sent to the party advising the status.   7. Double Guarantee System in Construction    When India's state-owned enterp rises order major projects that require construction guarantees, they 
recognize only local banks as the guarantee bank, but do not extend such benefit to foreign banks. As 
a result, foreign companies that have managed to ge t orders in India have to submit a Counter Bank 
Guarantee to a local bank and then receive a Ba nk Guarantee from the local bank. This double 
guarantee requirement is a burden to many foreign companies as it raises costs, such as the 
guarantee commission, and acts as a barrier to investment in India.  Korea hopes that the Indian government will expand the eligibility of the banks entitled to issue 
guarantees to foreign banks with high credit ratings.  
  WT/TPR/M/182/Add.1 
 Page 235 
 
 
  Reply:  There are no stipulations of the Reserve Bank of India mandating State Owned Enterprises to 
accept bank guarantees of domestic banks only.  
Standards 
 
(WT/TPR/S/182 pp.52~53 para.52~54)  
 
1. Paragraph L of Annex 3, which is a code of  good practice for the preparation, adoption and 
application of standards, of the WTO Agreement on Technical Barriers to Trade stipulates the 
following: 
"Before adopting a standard, the standardizing body shall allow a period of at least 60 days for the 
submission of comments on the draft standard by in terested parties within the territory of a Member 
of the WTO. This period may, however, be shortene d in cases where urgent problems of safety, health 
or environment arise or threaten to arise." 
However, in the case of India, draft standards on the Bureau of Indian Standards website are 
published for a minimum of one month. This peri od appears to be inconsistent with the above WTO 
rules. How much time does India grant on average for comments on draft standards and what is the 
position of India on this inconsistency? 
Reply: India gives adequate time for the seeking comments of other WTO members on its draft 
regulations.  In case there is an urgency or priority, draft standards are circulated for comments for one 
month. Otherwise, the documents are normally circulat ed at least 2 months in advance, thereby giving 
adequate time to the WTO members to give their comments.   
2. Paragraph F of Annex 3 of the WTO Agreemen t on Technical Barriers to Trade stipulates the 
following: "Where international standards exist or  their completion is imminent, the standardizing 
body shall use them or the relevant part of them, as a basis for the standards it develops" 
 
But, according to paragraph 53 of the Secretariat's report, the number of corresponding ISO/IEC standards is only 5,821 and accounts for 32% among the total of 18,219 in 2005/2006. The other 
standards account for 12,398.  
 Are the standards that correspond to other internatio nal standards such as ITU, CODEX included in 
the 12,398 standards?  Korea also expects India to make efforts to harmonize the 12,398 standards 
with international standards for trade facilitation among the WTO members.         
 
Reply: Continuous efforts are being made to harm onize Indian standards with international 
standards.  
 
3. The items required for ISI compulsory certificati ons were reduced from 133 at the time of the 
last Review to 66 at that of this Review (http: //www.bis.org.in/cert/man.htm). Thus, trade is expected 
to be further promoted. But, the number of ite ms under mandatory certification published by the 
Bureau of Indian Standards is different from 66 in paragraph 54 of the Secretariat's report. Korea 
requests an explanation regarding this difference between the two numbers.  
 Reply: The products under mandatory certification are reviewed periodically on the basis of the 
notifications issued by the Ministries/ Departme nts concerned. Therefor e, the earlier list of 133 
products under mandatory certification was revised dow nwards to 109 items. Later, this was modified 
to 66; and then to 73. The present number of items on which mandatory certifi cation is required is 68. 
This list is available at the BIS Website: www.bis.org.in. WT/TPR/M/182/Add.1 
Page 236  
 
  COLOMBIA
 
 
48. The Bureau of Indian Standards (BIS) (form erly the Indian Standards Institution) established 
under the Bureau of Indian Standards Act, 1986, an d operational since 1 April 1987, is responsible 
for formulating and enforcing standards for 14 sectors ..." 
Is the Bureau of Indian Standards a public, a private or a mixed body?  
Reply:  The Bureau of Indian Standards is a statutory body, set up by the Government of India under 
the BIS Act, 1986.   
 
54. The BIS operates a product certification schem e under the Bureau of Indian Standards Act, 
1986 and its accompanying regulations and rules.  The Bureau of Indian Standard Mark (ISI) is granted to products meeting the requirements of relevant Indian standards.  Although ISI certification 
is voluntary, it has been made compulsory for 66 products related to health and consumer safety 
(133 at the time of the last Review).
8  It is not clear, which products have been removed from the list.  
Both imported and domestically produced goods  on this list must conform to certification 
requirements.  The BIS has eight laboratories that  provide conformity testing for imported and 
domestically produced goods.  In addition, a number of other a ccredited independent laboratories 
having a demonstrated system complying with ISO/IEC Guide 17025:1999 and laboratories under the 
control of central and state governments have been  approved by the BIS, which uses them for 
conformity testing.9  Product certification can also be grant ed outside India once the manufacturer's 
production facilities have been approved and licensed by the BIS.  More than 60 licences have been 
granted under this Foreign Manufacturer's Scheme in  some 15 countries.  The licence fees include the 
cost of the inspector's visit and stay, an annual fee of Rs 1,000 (US$20) and an annual marking fee of US$2,000 to be paid by the manufacturer.  The li cence is initially valid for one year and can be 
renewed annually (at a fee of Rs 500 or around US$10).
10  Indian importers may also be granted a 
BIS licence provided they have the required infrastruc ture to test each consig nment when it reaches 
India.  The BIS operates IEC international certific ation schemes and has been designated the national 
certification body for recognizing and issuing certificates under the IECEE-CB and IECQ schemes.11  
In addition to product certification, the BIS grant s licences and ECO MARK to environmentally 
friendly products." 
- Does India not have any technical regulations in force?  Has it had any in the past, or is the 
only obligation the certification required in the ca se of the 66 products related to health and 
consumer safety mentioned in this paragraph?           
Reply: The technical regulations for products under mandatory certification are issued through 
notifications/ QC Orders by the concerned Ministries dealing with the product (s) in consultation with 
other Ministries/Departments concerned. For example, the Ministry of Health & Family Welfare is responsible for formulating technical regulations and guidelines for Packaged Drinking Water, food 
products etc. The Ministry of Consumer Affairs, Food & Public Distribution is the nodal ministry for coordinating mandatory BIS certification.  
 Technical regulations are brought out by di fferent Ministries/Departments under various 
legislations as given below: 
                                                     
 
 8 Appendix III of ITC(HS). 
 9 For a full list of recognized laboratories, see BIS online information.  Viewed at:  
http://www.bis.org.in/lab/osladd1.htm [13 June 2006]. 
 10 BIS online information.  Viewed at:  ht tp://www.bis.org.in/cert/fm.htm [13 June 2006]. 
 11 IEC System for Conformity Testing and Certification of Electrical Equipment and IEC Quality 
Assessment System for Electronic Components, respectively.  WT/TPR/M/182/Add.1 
 Page 237 
 
 
  1. The Prevention of Food Adulteration Act, 1954 (37 of 1954) 
2. The Fruit Products Order, 1955 
3. The Meat Products Order, 1973 
4. The Vegetable Oil Products (Control) Order, 1947 
5. The Edible Oils Packaging (Regulation) Order, 1998 
6. The Solvent Extracted Oil, Deoiled Meal and Edible Flour (Control) Order, 1967 
7. The Milk and Milk Products Order, 1992 
8. The Standards of Weights and Measures Act, 1976 (60 of 1976) (The Packaged 
Commodity Rules, 1977) 
9. The Infant Milk Substitutes, Feeding Bottles and Infant Foods (Regulation of Production, 
Supply and Distribution) Act, 1992 (41 of 992) 
10. Any other order issued under the Essential Commodities Act, 1955 (10 of 1955) relating 
to Food. 
 
- Does India have a list of technical regulations in force and of products subject to compulsory 
certification?  In what section of the economy are they concentrated?     
Reply:  The list of Indian standards under mandatory  certification is available at the Website: 
www.bis.org.in. The products are under mandatory certification for meeting the objectives of consumer health, safety, energy conserva tion, environmental protection, etc.  
   - Does India publish the observations made by the interested parties concerning a draft technical regulation?    
Reply:  Observations received from interested parties ar e considered before the technical regulations 
are finalised.  
 
- In what branches of industry does India have accredited laboratories?   
 
Reply:  The details of accredited laboratories are availa ble at the website of the National Accreditation 
Board for Laboratories (NABL): http://www.nabl-india.org.         - Has India concluded any mutual recognition agreements?    
Reply:  BIS has signed bilateral coope ration agreements with Sri La nka and Israel,  which have 
provisions for mutual acceptance of test and inspection reports:  - Does India have a national policy with  respect of intellectual property? 
 
Reply: India’s intellectual property policy is contai ned in the respective intellectual property 
legislations relating to patents, trademarks, designs, copyrights, semi- conductor designs of integrated 
circuits, plant variety protection and geographical indications. They are available at the websites: 
http://copyright.gov.in, http://ipindia.nic.in, www.mit.gov.in.  
Question 43 (a). Apart from the mentioned criteri a (cost, proposed employ ment, exports and foreign 
exchange requirements, and financial de tails), on what considerations  does the Government of India 
base its acceptance of investment proposals? Is th ere an established procedure, or does it depend on 
a case-by-case analysis? WT/TPR/M/182/Add.1 
Page 238  
 
   
Reply:  The Government of India has put in place a lib eral and transparent policy on FDI under which 
FDI up to 100% is permitted under the automatic ro ute in most of the sectors. For the “automatic 
route”, no prior approval is requi red from the Government of India. In the few sectors where prior 
approval is required for FDI, the proposals are to be  considered by the Foreign Investment Promotion 
Board. 
 
Question 43 (b): What is the policy for transfer of capital related to an investment (including 
liquidation of the investment)? Is th ere a tax on the outflow of dividends? 
 Reply:  Principal and income generated thereon by foreign investors are freely repatriable. Shares held 
by foreign investors can be disinvested/liquidated by selling in the Stock Exchange in case of listed 
companies or by transfer to a person resident in I ndia, in the case of unlisted companies. There are no 
restrictions for such disinvestments, provided all a pplicable taxes are paid. The bank at the time of 
remittance of disinvestment proceeds and income is re quired to ensure that all taxes have been paid.   
 Question 44 (a): Are there specific incenti ves for particular sectors or activities? 
 
Reply:  The FDI policy does not provide any special incentives for investments into any sector.  
 
Question 44 (b): Have the sectors to which foreign in vestment is chiefly directed in India been 
spontaneous recipients of investment, or has Indi a conducted a selection process to attract foreign 
investment to those sectors? If so, pl ease describe the selection process.  
 
Reply:  The Government of India has put in pl ace an enabling policy framework for foreign 
investment. During investment promotion even ts, sectors with investment opportunities are 
highlighted. There is no selection process to attract foreign investments. 
 
Question 44 (c): What is the amount of India’s in vestment abroad? In what sectors has it invested? 
 
Reply: India’s investment abroad from 1999 to Oct ober 2006 was US$ 7,780 million.  Investments 
have been made in the financial services sector , manufacturing sector and non-financial services 
sector. 
 
(2) Agriculture 
 
(ii) Agricultural policies 
"14. Agricultural policy is formulated and implem ented at the central level by the Ministry of 
Agriculture, with the Five Year Plan providing broad  guidelines on policy and the allocation of funds.  
Under the Constitution, agriculture is a state subject , but important decisions like those relating to 
research and development, facilitating infrastruc ture and investment, credit and trade, are taken by 
the Central Government ...  The Commission for Ag ricultural Costs and Prices (CACP) was set up in 
1965 to advise the Government on setting minimum support prices (MSPs) for different commodities 
(currently 25 essential commodities) and the mechanisms for implementi ng the MSPs.  In addition to 
the Ministry of Agriculture and the CACP, a number of public sector agencies are responsible for 
implementing agricultural and food policies.  The most important of these, the Food Corporation of India (FCI) was set up in 1964 to implement the food policy, including procuring and maintaining buffer stocks of food grains and for distributing food grains through the public distribution system 
(PDS) and various welfare schemes for poverty all eviation.  It is supported by the Central 
Warehousing Corporation set up in 1965.  The FCI purchases foodgrains at procurement prices set 
by the Government and sells them at the Central I ssue Price (CIP) also fixed by the Government...”  WT/TPR/M/182/Add.1 
 Page 239 
 
 
  - What are the commodities that are subject to minimum support prices? 
 - How are minimum support prices dete rmined for agricultural products? 
 - We would appreciate more detailed information on the way in which the mechanism used for 
the application of minimum support prices functions. 
 - How does the Government determine or estab lish the procurement price and the Central 
Issue Price for the purchase and subsequent sale of foodgrains by the Food Cooperation of India (FCI)? 
 Reply:  The commodities that are subject to minimum support prices are : (1) Paddy, (2) Jowar,  (3)  
Bajra,  (4)  Maize, (5) Ragi, (6) Arhar (Tur), (7) Moong,  (8) Urad,  (9) Cotton,  (10)  Groundnut in shell, (11) Sunflower seed, (12) Soyabean,  (13) Sesame, (14) Niger seed, (15) Wheat,  (16) Barley,  
(17) Gram,  (18) Masur (Lentil), (19) Rapeseed, (20) Safflower, (21) Toria, (22) Copra,  (23) Jute,  
(24) Sugarcane,  (25) Tobacco (VFC).  
 
 Minimum support prices for the agricultural products are determined taking into account the 
objectives of the policy.  The CACP advises on th e price policy of major agricultural commodities 
with a view to evolving a balanced and integrated  price structure from the perspective of the overall 
needs of the economy and with due regard to the interests of the producer and the consumer.  The 
Government’s price policy for agricultural commod ities seeks to ensure remunerative prices to the 
growers for their produce with a view to encour aging higher investment and production, and to 
safeguard the interests of consumers by making available supplies at reasonable prices.    
Accordingly, the Government announces each season Minimum Support Prices (MSPs) for major 
agricultural commodities taking into account the recommendations of the CACP. 
 
 In formulating the recommendations in respect of the level of minimum support prices and 
other non-price measures, the CACP takes into account, apart from a comprehensive view of the 
particular commodity or group of commodities, factor s such as cost of production, changes in input 
prices, input-output price parity, trends in market  prices, demand and supply, inter-crop price parity, 
effect on industrial cost structure, effect on cost of  living, effect on general price level, international 
price situation, and parity between prices  paid and prices received by the farmers. 
 
"21. As a producer of a wide variety of agricu ltural products, India is also keen to expand its 
exports, especially of horticultural products.  Sector-specific polici es are in place for these products 
to improve output and productivity, including  through increased investment in research and 
development..."  
- Given the importance to the country of the horticultural sector, could India please provide 
detailed information on research and developm ent in this branch of agriculture? 
 
Reply: Research and development in agriculture, in cluding Horticulture, is undertaken through the 
Indian Council of Agriculture Research (ICAR ), 25 State Agriculture Universities and one 
Horticulture University.  Development of superior varieties of horticulture crops with higher yield 
potential, vegetative propagation techniques and planting materials,  techniques for improving 
productivity and quality of produce, plant prot ection technologies and post harvest management 
technologies have been the focus of research and de velopment in Horticulture. The Government of 
India has launched the National Horticulture Missi on during 2005-06 for holistic development of the 
horticulture sector in the country. 
 
"36. Indirect subsidies for the agriculture sector  are provided in a number of ways, including 
facilitating access to credit and insu rance policies.  This includes access to credit under the priority WT/TPR/M/182/Add.1 
Page 240  
 
  sector lending requirement for commercial banks (at le ast 18% of their total lending needs to be to 
the agriculture sector).  It appears, however, that commercial banks have consistently failed to meet 
this target, and have been permitted to deposit up  to 1.5% of the shortfall in net bank credit to 
agriculture with the Rural Infrastructure Developmen t Fund (RIDF) since it was set up in 1995/96.  
The RIDF was established to assist states in investi ng in rural infrastructure and is administered by 
the National Bank for Agriculture and Rural Devel opment (NABARD).  The interest rates for banks 
depositing their shortfalls with the RIDF until 200 1/02 were 0.5% less than the rates of interest 
charged on RIDF loans to state governments.  However, the rates are now  based on the prevailing 
bank rate with the interest rate inversely proportional to the amount of the shortfall in credit to the 
agriculture sector." 
- Are there any other ways by which India provid es indirect subsidies to agriculture in addition 
to those mentioned in this paragraph?  How does each one of these ways of providing subsidies 
operate? 
 
Reply: Indirect subsidies and suppor t  provided to the farmers , including for extension services, 
training, research and development and support for ma rket and infrastructure, are provided consistent 
with the relevant provisions of  the Agreement on Agriculture, including Article 6.2 and Annex 2 
thereof.  II. TRADE POLICY REGIME:  FRAMEWORK AND OBJECTIVES 
(1) General constitutional framework 
 (i) Institutional and legal framework 
"4. Under Article 123 of the C onstitution, if the President deem s it necessary to enact legislation 
during Parliament's recess, an ordinance may be pr omulgated.  The ordinance has the same force as 
an Act of Parliament.  However, it will expire six weeks after the reassembly of Parliament unless it is 
enacted into law by both houses." 
- Do the powers of the President include the approval of international trade agreements? 
 - If so, what happens to agreements after si x weeks if they are not enacted by both houses? 
 
Reply: An ordinance is promulgated on an issue which requires immediate action and when 
Parliament is in recess.  International trade agreem ents are normally not in this category as they are 
concluded after considerable deliber ations both within  India and in  international fora and  have 
timelines decided months in advance.   
 
"10. The Department of Commerce also deals with policy relating to plantation crops (tea, coffee, 
rubber, cardamom, and tobacco), special econom ic zones, and export promotion and credit guarantee 
schemes through a number of autonomous bodies and st ate-owned enterprises (SOEs).  The SOEs are 
the State Trading Corporation of India (STC), STCL  Limited, MMTC limited, PEC Limited, Export 
Credit Guarantee Corporation of India Limite d (ECGC), and the India Trade Promotion 
Organization (ITPO).  The STC, STCL, and MMTC are also involved in state-trading activities." 
- Do the special economic zones and export pr omotion and credit guarantee schemes confer 
economic or operational benefits, de jure or de facto, in proportion or in relation to the exports 
carried out?   WT/TPR/M/182/Add.1 
 Page 241 
 
 
  Reply:  All export promotion measures seek to neutralise the incidence of all levies and duties on 
inputs used in export products based on the fundamental principle that duties and levies should not be exported. 
 
General Question 
 
It emerges from different sections of the Report by  the Secretariat that India grants subsidies to a 
large number of activities relating to the agricultu ral sector.  Does the amount spent by the country 
for that purpose currently exceed the de minimis level (10 per cent for developing countries)?  Please 
explain?   
 Reply: India’s agricultural subsidies are within the de minimis  entitlement for developing countries as 
evident from the notifications already made.  It is not ed that the subsidies being given by India in the 
agriculture sector are mostly dir ected to the low-income and/or resource-poor farmers, and also to 
provide food security, particularly to the more vulnerable sections of the society, and to provide 
general services to the agriculture sector, consistent with the relevant provisions of the Agreement on 
Agriculture, especially Article 6.2 and Annex 2.  The notifications for the subsequent period which 
will be made as soon as possible will explain the situation.  
III. TRADE POLICIES AND PRACTICES BY MEASURE 
(1) Overview 
 
"1. In addition to tariffs, additional duty, in lieu of excise (a central tax on domestic manufacture) 
and a 4% special additional duty to partly compensa te for internal taxes such as value added tax, 
municipal tax, "market committee fees" etc., are charged to provide national treatment to the 
imported good."  
- Is the additional import duty mentioned in this paragraph applied to  all products imported 
into India? 
 
Reply: Barring a few exceptions, the additional import dut y is applied to all products imported into 
India.   
- What is the amount of the "additional duty"?  Is it a specific duty or an ad valorem 
percentage?  
Reply: The additional duty on an imported article is equa l to the excise duty leviable on a like article 
produced or manufactured in India and where such duty on a like article is leviable at any percentage 
of its value, the additional duty is calculated at that  percentage of the value of the imported article. 
 
- Are the additional duty and special additional duty applied to products originating in 
countries with which tariff p references have been negotiated? 
 
Reply: Yes, it generally does. 
 17. The simple average applied MFN tariff for agriculture (WTO definition) increased slightly 
from 40.7% in 2001/02 to 40.8%, compared with a simple average bound rate of 117.2%.  Tariffs on 
agricultural products are all ad valorem excep t for two lines (shelled and non-shelled almonds), 
unchanged from the previous Review.  Applied tar iff rates range from 0% to 182% ... However, for 
the majority of tariffs, there remains a cons iderable gap between the applied and bound rates, 
ranging from 10% to 300% ... India also uses "reference prices" to calculate customs duty applicable 
on imports of, inter alia, palm oil (crude and RB D), palmolein oil (crude and RBD), and crude WT/TPR/M/182/Add.1 
Page 242  
 
  soybean oil.  Under Section 14(2) of the Customs Act, reference prices can be fixed by the authority 
"if satisfied that it is necessary or expedient to do so";  customs duty on these imports are calculated 
on the basis of the reference prices rather  than the price quoted by the importer.
12" 
 - Is the use of reference prices to calculate cu stoms duty applicable on imports of products 
such as palm oil consistent with the WTO Agreement on Customs Valuation? 
 
Reply:  Under Section 14(2) of the Customs Act, 1962 tariff values can be fixed for any class of 
imported goods or export goods  having regard to the trend of value of such or like goods.  There is no 
provision for imposing minimum prices.  The tariff va lue mentioned in the question is currently being 
fixed only in respect of palm group of oils, crude  soybean oil and brass scrap.  These values are based 
on the current international prices a nd are being frequently revised.   
 
(iv) Telecommunications 
 
(b) Structural reforms 
 "117. To simplify the licence regime, a Unified Access Service (UAS) licence regime for fixed line 
and cellular services was introduced  in November 2003.  The UAS regime allows an operator to 
provide any or all types of services permitted in th e licence. Thus, operators are no longer required to 
have separate licences for each type of service prov ided.  Furthermore, in  April 2004, licence fees 
were reduced by 2%; current fees range from 6% to  10% of adjusted gross revenue (AGR) for UASs 
in the designated service area." 
- Does the Unified Access S ervice licence regime include  voice IP services? 
 
Reply:  Yes 
 
- What regime applies to those services? 
 
Reply:  UAS and CMTS licensees can provide VOIP. 
 
"118. Restrictions to foreign investment ha ve been relaxed since 2000, when 100% foreign 
ownership was allowed for int ernet service providers (ISPs) without  gateways, infrastructure 
providers providing dark fibre, and electronic and vo ice mail services;  companies providing these 
services must, nonetheless, divest 26% of equity in fav our of the Indian public in five years, if they are 
listed outside India.  From 2001, 74% foreign own ership was permitted for ISP with gateways, radio 
paging, and end-to-end bandwidth services.  In No vember 2005, foreign investment equity restrictions 
were increased from 49% to 74% in  certain areas, such as fixed line, cellular, unified access services, 
national and international long-distance calls services." 
- What is the regime for internet service providers, and who regulates such services? 
 
Reply:  Internet Service Providers (ISPs) are registered with DoT. TRAI is the regulator for all the 
services. For details visit: www.dot.gov.in  
 
- Are there different obligations for internet  service providers with gateways and without 
gateways?  
Reply:  Yes.  
                                                     
 
 12 According to the authorities the prices are aligned w ith international prices and are revised frequently 
to avoid any discrepancy with international prices.  WT/TPR/M/182/Add.1 
 Page 243 
 
 
  - Why the increase restrictions on foreign equity  investments?  What are these restrictions 
supposed to achieve?  
Reply:  National Security measures are the major considerations.  
 (i) Trade policy formulation and implementation 
"9. Trade policy formulation and implementation remains with the Department of Commerce, in 
the Ministry of Commerce and Industry,  in consultation with other key ministries such as the Ministry 
of Finance, Agriculture, as well as ministries rela ting to services, and the Reserve Bank of India.  
Trade policy is formulated and drafted in cons ultation with state and union territory governments, 
industry and farmers' associations, trade bodi es, research and academic institutions, and other 
stakeholders.  The policies are announced for a fi ve-year period, along with annual reviews, in the 
Foreign Trade Policy (previously known as the Expo rt-Import Policy), which is accompanied by the 
Handbook of Procedures.  The Foreign Trade Policy and Procedu res are implemented by the 
Directorate General of Foreign Trade (DGFT), while  advice on tariff and related issues is provided 
by the Tariff Commission, both based in the Ministry of Commerce and Industry ..." 
- Does the Handbook of Procedures for foreign trade (export-import policy) change every five 
years?  - Are such changes published before they ent er into force and duly notified to the WTO? 
 
Reply: The Handbook of Procedures (Volume 1) of the Foreign Trade Policy specifies the procedures 
to be adopted for implementation of the Foreign Tr ade Policy. Whenever there is a change of any 
provision of the Policy which requires a change in procedure, the  Handbook is amended accordingly. 
Moreover, procedures are also changed as a measur e of  simplification, transparency, reduced 
documentation and electronic filing facility. All such  changes are notified through a Public Notice in 
the Official Gazette and becomes effective from the date of notification, unless otherwise specified. 
These changes are not notified to the WTO. However, they are immediately uploaded to the website 
www.dgft.gov.in and placed in the public domain. 
 
(i) Financial services 
 
"92. Although financial services, par ticularly banking and insurance, continue to be dominated by 
state-owned companies, measures have been adopted  to encourage competition from the private 
sector.  For example, restrictions on foreign banks have been relaxed.  Efforts have also been made to 
improve corporate governance in financial services.   For example, the RBI introduced prudential 
requirements to align the banking sector with int ernational practices, although implementation was 
postponed.  Also, all stock exchanges must be corporatized, and from January 2006, all listed 
companies are required to adopt the corporate governance requirements specified in the listing 
agreement."   - Do State-owned financial institutions receive any  kind of benefit or special treatment with 
respect to private financial institutions? 
 Reply: All insurance companies whether in the priv ate or public sector, are governed by the IRDA 
Act, 1999 and Insurance Act, 1938. No special tr eatment  is given to state owned insurance 
companies.  WT/TPR/M/182/Add.1 
Page 244  
 
  • Private Sector Banks are subjected to the same Prudential Guide lines in the form of 
Capital Adequacy, Asset Classification, Provisioning and Income Recognition as 
applicable to State owned Banks.  
• The regulatory framework is common for all banks whether private or public. 
• Priority sector lending norms are also common for both categories of banks in the 
domestic arena. They are lower for foreign banks.  
 (4) Developments in Foreign Investment  "40. The sharp rise in inward portfolio investm ent, from approximately US$944 million in 2002/03 
to approximately US$12.5 billion in 2005/06 (more t han double inward FDI), is due to both global 
and domestic factors. Emerging markets as a whole ha ve benefited from low long-term interest rates 
in the advanced economies.  In addition, robust corporate performance in India and the resulting 
strong GDP growth, coupled with increased forei gn institutional investor (FII) limits may have 
fuelled portfolio investment." 
- Is it possible to conduct transactions (including investment) in foreign currency? 
 
Reply: Foreign investments can be made in India b asically under three main routes—FDI, Portfolio 
Investments (FIIs and NRIs) and Vent ure Capital Investments (FVCIs).  
  Under the FDI Scheme, investments can  be made only in Indian Rupees.  
  FIIs and FVCIs registered with SEBI are a llowed to open foreign currency accounts as well as 
Rupee accounts with banks in India to receive remittances from outside India for investments.  
 
In all of the above mentioned routes, invest ment in foreign currency is not allowed. 
Investments are always to be made in Indian Rupees  
30. As a result of criticism of the PDS, the target ed system was introduced in 1997 to better serve 
the poorer segments of the population ...  The CI Ps under the TPDS are fixed by the Government and 
involve a subsidy, particularly for the BPL and  AAY consumers.  The food subsidy budgetary 
allocation for 2006/07 is Rs 239.86 billion, or 4.3% of total government expenditure.  Procurement of 
rice and sugar are subject to "levies", which are fixed  shares of output that must be sold to the 
Central Government at fixed prices for the TPD S ...  Rice procured by the Government through a 
statutory levy on rice millers and rice dealers is fixed  by states in consultation with the Central 
Government and varies from State to State;  it cu rrently ranges from 10% to 75% of paddy procured 
by rice millers/dealers ..." 
How is the statutory levy on rice millers and rice dealers established?  Does this mechanism exist for 
any other product?  What product? 
 
Reply: Government is procuring rice for the Central Pool to cater to the requirements of the Targeted 
Public Distribution System (TPDS) and Other Welfare Schemes (OWS).  There is open ended 
procurement of paddy under price support operations.  The paddy procured is converted into custom 
milled rice (CMR).  Rice is procured under the stat utory levy system from millers/dealers.  Rice Levy 
Orders have been issued by various States/UT s availing of powers under the Essential Commodities 
Act, 1955.  The Levy Orders specify the percenta ge of rice to be compulsorily sold by the 
millers/dealers to the Food Corporation of India/St ate Government at the levy price fixed by the 
Government of India every year and conforming to the quality specifications laid down by the 
Government of India.  The rice le vy percentage is determined by the State Governments with the prior 
concurrence of the Central Government, keepi ng in view the production, market surplus and  WT/TPR/M/182/Add.1 
 Page 245 
 
 
  requirement for TPDS/OWS.   The State Government s ensure compliance of levy orders and take 
action under the Essential Commodities Act against defaulters.  
REPLIES TO ADDITIONAL QUESTIONS FROM COLOMBIA  
 DOCUMENT WT/TPR/G/182 
 
Trade facilitation  73. ....... This has the following features:  (i) System based assessment of risks, (ii) "No 
assessment, no examination" facility to clients with  a proven track record , (iii) Intervention by 
exception.  The introduction of RMS has led to cons iderable reduction in the dwell time of incoming 
cargo.  The Department has also introduced a syst em of electronic payment of import duty on pilot 
basis in Delhi for the quick clearance of goods.  - Could you indicate by means  of a flowchart the reduction achieved in dwell time since 
applying the risk management system – i.e. the diff erence in the amount of time before the system 
came into use as compared to now that it is fully applied?   Reply:  
6
246846528
020406080100120140160
Pre RMS (Oct-Nov '05) Post RMS (Aug-Oct '06)
Data for NCH, Sahar ACC, Mulund, Kolkata Sea,  B'lore ICD and Air, Chennai Air and Sea
(Chart represents averages for the 8 sites - for facilitated BEs)Risk Management Division, CBEC, IndiaTime (hrs)RMS Impact on Dwell Time
Assessment timeOOC time
Duty payment time
 
 
 As can be seen from the graph above, the time taken by customs for assessment has come 
down to about 2 hours from the earlier 46 hours. Similarly the time taken for completion of examination and according out of charge (OOC) or release of goods by Customs (i.e, from the time of registration of goods for examination to giving  OOC) has come down from 28 hours to 6 hours. 
However, the time taken for the payment of duty, which is in the hands of the importer/Agents has 
increased from 65 hours to 84 hours. This underscores the fact that the trade has to gear up its 
activities to reap the benefits of RMS, by way of  re-engineering a few of its business processes. The WT/TPR/M/182/Add.1 
Page 246  
 
  facility of e-payment of customs duties has also been  provided to the importers and it is expected to 
cut down the time taken to pay duty.   
 
Document WT/TPR/S/182 
 
14. To speed up customs clearan ce, the electronic data interchange (EDI) system was introduced 
in May 1995 and is applied at all major ports and air cargo complexes.  It is operational in 34 
customs stations, and about 85% to 90% of impor t/export documents are processed electronically:  
about 0.25 million importers/exporters are using EDI fa cilities.  According to the authorities, the EDI 
and a risk management system at major customs ports  has significantly reduced the time taken for 
customs clearance (section (ii)(b) below). 
 
- How long does it take to clear goods thr ough customs in normal circumstances?  
 
Reply: Data collected for the year 2006-07 shows that at sea ports (including ports where RMS is not 
operational), the average time taken by customs in  clearance procedures varied between 26 to 49 
hours (on a 24-hour day cycle, including holidays and off time). The data for airports (including airports where RMS is not operational) shows th at the average time taken in customs clearance 
procedures varied between 25 to 28 hours (on a 24-hour day cycle, including holidays and off time).  
 
19. The RMS uses a valuation ri sk assessment module (VRAM) to u se a weighted average value 
of recent like imports of sensitive goods.  The list of products considered to be sensitive was not 
provided as the specifics of risk assessment are confidential.  Acco rding to Customs, the introduction 
of these electronic databases has facilitated quicker clea rance of imported cargo on the basis of self 
assessment without requiring any intervention by Cu stoms for "a considerable percentage" of the 
total cargo;  the percentage could not  be revealed for enforcement reasons. 
 
- Although the percentage of imports cleared on a self-assessment basis may not be disclosed  
for enforcement reasons, would it be possible to find out what percentage of goods are physically 
inspected with the use of the risk management system? 
 
Reply:  This figure varies from location to locati on and depends on the basket of commodities 
imported through a port/airport/ICD (dry port). Genera lly, 45-50 % of consignments are subjected to 
intrusive examination.  
 
- Lastly, could you tell us whether use of a customs agent is mandatory for all foreign trade 
operations or whether there is any possibility for importers and exporters to  deal directly with 
Customs?  
Reply:   As per the provisions of section 146 of the Customs Act, 1962, Customs Agents are licensed 
to carry out business relating to the entry or depa rture of a conveyance or the import or export of 
goods at any Customs station.  It is not mandato ry to utilize the services of Customs Agents and 
importers and exporters can deal directly with Cust oms also. Sections 46 and 50 of the Customs Act, 
1962 which require the filing of a Bill of Entry & Sh ipping Bill, respectively, allow the importers and 
exporters to file the declarations and transact business directly with Customs.   
 
BRAZIL
 
 
Q No 36 Could the Government of India inform us  what authority is responsible for issuing the 
certificate of origin when it is required from importer countries?  
  WT/TPR/M/182/Add.1 
 Page 247 
 
 
  Reply: The authority responsible for issuing the Certifi cate of Origin (Non-Preferential) is given in 
Appendix 4 C of Handbook of Procedures, Volume  1 and is available on the DGFT website 
www.dgft.gov.in.   
Q No 40 India informs that there are three hundred products subject to import licensing. Could India 
inform us which products are those in terms of harmonized system?  
 
Reply: The items which are restricted for imports are available in the ITC (HS) Classifications of 
Export and Import Items, 2004-09 as also at the website www.dgft.gov.in.   
 
Q No 39 Could the Government of India inform us the administrative procedure costs on the 
processing of licenses.   
Reply:  The application fee for an import licence is Indian Rupees (INR) 2 per INR 1000 of CIF value 
of the goods specified in the application or pa rt thereof subject to a minimum of INR 200 and 
maximum of INR 1,50,000. However, for applications filed electronically, the fee is Rs.1/1000 or part 
thereof subject to a minimum of INR 200 and maximum of INR 75,000.  
WT/TPR/S/182 III (3) (viii) 
 According to paragraphs 96-99, p ages 65 and 66 of the Secretariat’s report, since 1965 India has 
export processing zones (EPZs) in place. In  1980 export oriented unit (EOU) schemes were 
introduced and, more recently (2001), the Indi an Government further expanded the network by 
establishing Special Economic Zones (SEZs). Indus tries located within EPZs, EOUs and SEZs are 
provided with incentives (income tax relief; exem ption of import licenses; exemption from customs 
duty for industrial inputs) contingent upon expor t performance (either there are minimum export 
requirements or industries are required to be net foreign exchange earners). 
 Export subsidies are prohibited under Art. 3.1( a) of the Agreement on Subsidies and Countervailing 
Measures (ASCM). For some developing country Memb ers, such as India, the prohibition shall not 
apply (Art. 27.2), unless the country has reached “ex port competitiveness” in one or more products, 
when export subsidies on such products sha ll be gradually phased out (Art. 27.5). 
 
Could India indicate if any of the products ex ported from EOUs and SEZs have reached “export 
competitiveness”?   
Reply: The SEZs which focus on manufacturing and services  for exports, work on a principle that taxes 
should not be exported. As such these areas are ou tside the Customs Territory of India and insulated 
from taxation on goods and services required for authori zed activities. Even otherwise, all the exports 
are eligible for exemptions and drawbacks. SEZ Ac t in India has been operationalised only 15 months 
ago and this is too short a time to assess the e xport competitiveness of products manufactured and 
exported from SEZs.   As for exports from Export Orient ed Units, the share in India’s total exports as a 
whole is still very negligible to ha ve any major impact on global trade .   
 
WT/TPR/S/182 III (4) (v) Page 84  
 
It is clear in note 146, related to paragraph 1 56, Chapter III, of document WT/TPR/S/182, that 
traditional knowledge is not patentable.  In that sense, please explain how India is granting protection 
to traditional knowledge.  
 Concerning paragraph 157, Chapter III, of document WT/TPR/S/18 2, please confirm that the 
titleholder of a patent granted from the some 8,000 applications that were made through the 
“Mailbox” facility (Articles 70.8 and 70.9 of th e TRIPS Agreement) are not able to prohibit or WT/TPR/M/182/Add.1 
Page 248  
 
  prevent third parties exploiting the patent if they ha d been already producing the patented product 
when the patent was granted even if the titlehold er does not agree with the amount of royalties 
defined?  
 
Reply: Traditional Knowledge per se is not patentable under Section 3 (p) of the Patents Act. Any 
value addition to such knowledge is protected if it fulfils the criteria of patentability. India has taken 
initiative to establish a Traditional Knowledge Digital Library (TKDL) where over 1,65,000 
formulations have been digitized and made availabl e in an electronically acceptable format in English, 
French, German, Spanish and Japanese  languages. This data-base is be ing made available to European 
Patent Office under a non-disclosure agreement. This  would help in preventing the grant of patents 
such as neem, turmeric (haldi), etc.  
  Exclusive Marketing Right (EMR) provision was provided for giving protection to pharmaceutical products which were to be provide d patent protection as per the TRIPS Agreement 
(Mail-box applications). Four EMRs were grante d on the following products of the following 
companies: 
 
♦ United Phosphorus (Carbendazim & Mancozeb) 
♦ Novartis (Imatinib Mesylate) 
♦ Wokhardt (Nadifloxacin) 
♦ Eli Lilly (Tadalafil) 
 
 The provision under section 11 A (7) provides for protection of the right of the patent holder in respect of the mail box application accruing from the date of grant of the patent which is 
compatible with Article 70.8 (c) and with Article  28 of the TRIPS Agreement. Applicant for the mail-
box application had an opportunity to avail of the exclusive marketing right during the transition 
period and enjoy the patent right after the grant of  patent. Determination of royalty is a commercial 
decision between the two parties. Any dispute rela ting to reasonableness of royalty can be brought to 
the court for settlement.   What is the actual exhaustion of rights regime for marks in India? 
 
Reply: The general legal principle is that once certain  goods bearing the registered trademarks are 
lawfully acquired by a person, subsequent sale of the goods in the market or otherwise dealing in 
those goods is not an infringement just because the ownership in the registered trademark has changed 
by reason of any assignment of the trade mark.  
  This principle is recognized by section 30(3) of the Trademarks Act 1999.  That section also recognizes the principle that the rights of trade mark  proprietor are exhausted when the goods are put 
in the market by the proprietor, or with his consen t, so that acquisition of such goods and subsequent 
further dealing in those goods do not attract any infringement action. 
 
Concerning paragraph 169, Chapter III, of document  WT/TPR/S/182, please explain what are “works 
withheld from the public”.  
Reply:  As per section 31 of the Copyright Act, 1957 fo r a published or performed in public work the 
owner of the copyright has refused to re-publish or allow the re-publication of the work or has refused 
to allow the performance in public of  the work, then by reason of such  refusal “the work is withheld 
from public”. In such cases the provisions of co mpulsory license under section 31 can be invoked by 
anyone. 
  WT/TPR/M/182/Add.1 
 Page 249 
 
 
  When the author is dead, who is the licensor (e.g . successor) and who is able to be the licensee? And 
when the author is unknown?  
Reply: In case the author is dead, the license is gran ted to his legal representative in the absence of 
any provision to the contrary in the license.    
 
 When the author is unknown or cannot be traced , or the owner of the copyright for the work 
cannot be found, any person may apply to the Copyrigh t Board for a license to publish such work or a 
translation thereof in any language.  Thereafter th e Copyright Board after holding such inquiry, as 
may be prescribed, direct the Registrar of Copyrigh ts to grant to the applicant a license to publish the 
work or a translation thereof in the language menti oned in the application subject to the payment of 
such royalty and subject to such other terms a nd conditions as the Copyright Board may determine, 
and thereupon the Registrar of C opyrights shall grant the license to  the applicant in accordance with 
the direction of the Copyright Board.  Please inform if and how India is dealing with the mutual existence of geographical indications and marks which would result in a likelihood of confusion?  
Reply: Geographical Indications and Trade Marks are admi nistered by two different Acts namely The 
Geographical Indications of Goods (Registration a nd Protection) Act, 1999 and The Trade Marks Act, 
1999 respectively. A Trade Mark is a private property right owned by the Registered Proprietor. As 
against this, a Geographical Indication is a community  right owned by all the producers or 
manufacturers of the concerned Geographical Indicati on. Geographical Indication in India is granted 
for a product with special quality or characteristic ess entially attributable to the geographical origin of 
the place.   
 Specific provisions have been enacted in th e Geographical Indication statute (Section 25) 
which prohibits the registration of a geographical indication as a trade mark or invalidates any geographical indication registered as a trade mark as it would lead to expropriation of a public property by an individual leading to confusion in the market.    Section 26(1) of the Geographical Indications  (Registration and Pr otection) Act, 1999 (GI 
Act) protects the validity of a registered trade ma rk which contains or consists of a Geographical 
Indication if it has been already registered in goo d faith before commencement of the GI Act. Further 
as per Section 26(4) of the GI Act, no action seeking to prevent the use or cancellation of registration 
of such registered trade mark can be initiated after 5 years from the date of commencement of GI Act, 
i.e. after 15
th September, 2008. The GI Act was brought into force with effect from the 15th 
September, 2003. 
 
Concerning paragraph 176, Chapter III, of document WT/TPR/S/182, besides the Protection of Plant 
Varieties and Farmers' Rights Act, is there any ot her intellectual property legislation in India 
providing for the benefit sharing? 
 Reply:  The access to genetic resources and subsequent sh aring of benefits in India is regulated by the 
Biological Diversity Act, 2002. The Act provides fo r conservation of biological diversity, sustainable 
use of its components, and fair and equitable shari ng of the benefits arising out of the utilization of 
biological resources, knowledge and matters incidental to them.  
 What are the statistics concerning the registers of integrated circuits layout-design since the 
Semiconductor Integrated Circuits Layout -Design Act was passed in September 2000? 
 
Reply: The statistics is not available at present. 
 WT/TPR/M/182/Add.1 
Page 250  
 
  Concerning paragraph 154 of document WT/TPR/S /182 (p. 84), could India provide further 
information on the amendments it intends to pursue in its copyright legislation with a view to 
complying with the WCT and WPPT provisions?  
Reply: No such time frame can be set in view of th e Parliamentary approval required to be obtained 
in respect of any law. The process of stakeholder co nsultation as a part of the process of amending the 
Copyright Act is currently on. The suggestions  received from various sectors along with the 
comments/ suggestions received from other stakeholders  is being carried out by the expert/ technical 
committees constituted for the purpose.  India has one of the modern copyright laws in the world and 
the amendments made in the Indian Copyright Act from time to time had ensured that it was fully 
TRIPS complaint. Though India has not yet accede d to the two internet treaties namely, WIPO 
Copyright Treaty (WCT) and WIPO Performances a nd Phonograms Treaty (WPPT), the process is on 
for amending the Copyright Act with a view, inter al ia, to explore the possibilities of incorporating the 
relevant provisions of the two treaties in the Copyright Act, 1957. 
 
Is there any legislative initiative under discussion regar ding the implementation of specific legislation 
for the protection of trade secrets (paragraph 182 of WT/TPR/S/182)?  
Reply:  The existing laws, namely the Drugs and Cosm etics Act and the Insecticides Act provide data 
protection. The Indian Government is presently examin ing the extent of change that would be needed 
in these laws to give protection against unfair use of  clinical test data submitted to the regulators. 
 
 
CANADA
 
 
Part IV - Trade Policies by Sector, (5) Services,  (vi) Professional Services, (b) Legal services, 
Paragraph 171, page 147:  
Paragraph 171 states that "Foreign law firms ar e not permitted to open offices in India and are 
prohibited from giving any legal advice that c ould constitute practicing of Indian law."  
 
1. Could India please identify if foreign lawyers and law firms are able to provide advisory 
services on foreign and international law on a cross-border basis, provided that they are qualified 
and licensed to practice these types of  law in their home jurisdiction? 
 
Reply:  India does not have information relating to any foreign lawyers or law firms providing 
advisory services on foreign and international law in  India on a cross border basis. Since the Bar 
Council of India has not so far recognised any forei gn qualification for the purpose of enrolment of 
foreign nationals as advocates in India, any form of professional legal advice or consultancy services 
provided in India by foreign lawyers, located physi cally in India, is not permitted even if it is on 
foreign and international law.  
 
Part IV - Trade Policies by Sector, (5) Services,  (vi) Professional Services, (b) Legal services, 
paragraph 172, page 147:  
Paragraph 172 states that "Legal services can be pr ovided only by natural persons who are citizens of 
India, and who are on the advocates roll in the state where the service is being provided."   2. Could India please explain if this restriction is  limited to the practice of domestic (Indian) 
law, or does the nationality/citizenship requiremen t also apply to a foreign lawyer who wishes to 
provide foreign legal consultancy services (advisor y services on foreign and international law in 
India), provided they are qualified and licensed to practice these types of law in their home 
jurisdiction?    WT/TPR/M/182/Add.1 
 Page 251 
 
 
  Reply:  India does not have information relating to any foreign lawyers or law firms providing 
advisory services on foreign and international law in  India on a cross border basis. Since the Bar 
Council of India has not so far recognised any forei gn qualification for the purpose of enrolment of 
foreign nationals as advocates in India, any form of professional legal advice or consultancy services 
provided in India by foreign lawyers, located physi cally in India, is not permitted even if it is on 
foreign and international law.  
 
Agriculture  
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, 
(iii) Tariffs, (a) Overview, paragraph 21, page 38:  
The Secretariat Report notes that in the WTO Co mmittee on SPS Measures, “[s]ome Members also 
expressed concerns about the lateness  of India's notifications on new fumigation requirements in 
place since January 2004, as this did not allow sufficient time for comment; there was also concern 
that the measures deviated from international stan dards.  Non-notification of  various SPS measures 
was also raised by several Members.”  3. (a) Could India please provide information on w hat measures it is implementing to respond to 
concerns raised by WTO Members related to Indi a’s ad hoc compliance with WTO SPS transparency 
obligations, in particular notifica tion of draft trade-related meas ures when comments can still be 
taken into account (Annex B, paragraph 5b)? 
 
Reply: All draft notification to the phytosanitary re gulations are being issued to the WTO with 
minimum period of at least 60 days for comments from the member countries which are duly considered while finalizing the notification.  In on ly one case the notification could not be circulated 
at the draft stage, but the measure was subseque ntly kept in abeyance, and the comments received 
were duly considered before issuing the final notification. 
(b) Can India explain why several of its SPS notificat ions issued during the review period were 
issued several months after the measures were in force?    
Reply:  Beyond the one instance detailed out in (a) above , we are not aware of other ‘several’ delayed 
notifications.   
Part IV – Trade Policies by Sector, (2) Agricult ure, (ii) Agricultural Policies, (a) General 
Framework, paragraph 15, page 103:  
  
The Secretariat Report says that, India's first Nati onal Agricultural Policy aims “to raise annual 
growth in agriculture over the next two decades to over 4% based on an efficient use of resources 
while conserving India's soil, water, and biodiversity and equity across the regions...”  
  India's National Forest Policy (1988) goals were “to ha ve a minimum of one - third of the total land 
area of the country under forest or tree cover. In the hills and in mountainous region, the aim should 
be to maintain two-third of the a rea under such cover in order to m eet ’India's aims at maintaining a 
minimum of 33 percent of country’s geog raphical area under forest and tree cover.” 
  
4. (a) Could India provide information on curren t policies with respect to maintaining or 
increasing their forest land cover and work in the a rea of sustainable forest management of their 
existing forest resources? 
 Reply:   The required information may be obtained from the website of the Ministry of Environment 
and Forest at http://envfor.nic.in. WT/TPR/M/182/Add.1 
Page 252  
 
  Part IV - Trade Policies by Sector, (2) Agricultur e, (ii) Agriculture policies, (b) Import Policy, 
paragraph 16, page 104:  The Secretariat Report notes that India continues to  use trade policy to support its overall goals of 
food self-sufficiency and price stability. Accordingly, ta riffs are adjusted from time to time to ensure 
sufficient domestic supply of key products. For examp le, in 2006 India granted a tariff duty exemption 
for imports of wheat.  Wheat exporting countries welcomed the trade opportunity created by this tariff exemption. 
 
3. Could India please identify when it will be adjusting its trade policy towards more permanent 
tariff reductions and a predictable trade envir onment for wheat and other similar agricultural 
products?  
 
Reply: Apart from the objectives of food security and pri ce stability, trade policy also helps meet the 
objectives of livelihood security and rural developmen t in India.  The quoted decision to import wheat 
was intended to make up for the short fall of wheat  procurement under publicly-held buffer stocks in 
the Rabi marketing season 2006-07.  Having regard to its food security, livelihood security and rural 
development needs, the G-20, of which India is a Member, has already proposed substantial overall 
bound tariff reductions across agricultural products of a maximum of 36 per cent, provided these are two-thirds those that may be committed to by the developed country Members, coupled with 
appropriate flexibilities through Special Products and th e Special Safeguard Mechanism, as a part of 
the outcome of the Doha Work Programme.  
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requiremen ts, paragraphs 48-55, pages 50 to 53:  
 
The Secretariat Report makes no mention of the pr ocess undertaken by India to develop and adopt 
technical regulations and conform ity assessment procedures, nor any mention of which Ministry has 
regulatory authority.  (a) Could India explain how its technical regulat ions and conformity assessment procedures are 
developed and adopted? 
 
Reply: Kindly refer to BIS Rules, 1987 at Hyperlink : http://www.bis.org.in/bs/index.htm. The 
technical regulations for products under mandatory ce rtification are issued through notifications/ QC 
Orders by the concerened Ministries dealing w ith the product(s) in consultation with other 
Ministries/Departments concerned. For example, the Ministry of Health &family Welfare is 
responsible for formulating the technical regulati ons and guidelines for Packaged Drinking Water, 
food products, etc. The  Ministry of Consumer Affairs, Food & Public Distribution is the nodal 
ministry of coordinating mandatory BIS certification.  
 
 BIS operates its product certification schem e under the BIS Act 1986 and its accompanying 
rules and  regulations. The conformity assessment pr ocedure being followed by BIS is of ‘System V’, 
which takes into account the testing & assessmen t of factory quality control and its acceptance 
followed by testing of samples both from the factory and the open market. These procedures are 
developed by BIS and approved by the government  for adoption and implementation through BIS 
rules and regulations. The ISI mark is granted to products meeting the requirements of the relevant 
Indian standards and a firm having the reqisite manufacturing and testing infrastructure as per the 
relevant Indian standards. 
(b) Could India please explain which of its mi nistries has authority to create technical 
regulations and conformity  assessment procedures?  WT/TPR/M/182/Add.1 
 Page 253 
 
 
  Reply:  Technical regulations are framed by the concerned Ministries/Departments such as, the 
Ministry of Consumer Affairs,  the Ministry of Health & Family Welfare, the Ministry of Surface 
Transport & Highways, the Ministry of Commerce & Industry, the Ministry of Industries, the Atomic Energy Regulation Board, the Ministry of Environment and Forests, etc.   
 The Indian Standards for which conformity is to be assessed are formulated by BIS which is 
functioning under the Ministry of Consumer A ffairs & Public Distribution. The conformity 
assessment procedures are also laid down by BIS. 
 
Part III – Trade Policy and Practices by Measure, (2) Measures Directly Affecting Imports, (xi) 
Standards and Other Technical Requirements , (a) Standards, paragraph 48, page 50:  
 
According to the Secretariat Report, the Bureau of Indian Standards (formerly the Indian Standards 
Institution) established under the Bureau of Indian Standards Act, and opera tional since 1 April 1987 
is responsible for formulating and enforcing standar ds for 14 sectors.  In addition to the BIS 
standards for 14 sectors, a number of sector-specific standards for the automobile industry, pollution, 
food, drugs and cosmetic, as well as atomic energy and civil aviation.  
 (a) Could India explain which of the standards developed by the BIS are voluntary and which are 
mandatory? 
 Reply:  BIS has formulated around 18,300 standards of which  8,300 are product standards. Presently, 
there are 68 product standards which are under mandatory certification. The list of these mandatory standards is available at the BIS Website: www.bis.org.in.   
(b) Could India explain who develops the oth er “sector-specific” standards (i.e. those not 
developed by BIS) and which of these standards  are voluntary and which are mandatory ? 
 
Reply: Besides BIS, other Ministries formulate sector specific standards under various Acts and 
Regulations. A listing of the organizations, other than  BIS, engaged in develo ping standards is given 
in the BIS Catalogue at page xiii-xv. 
 
(c) Does India develop standards related to wood pr oducts?  If so, which organisation(s) are the 
developed by?  
 
(d) What is the Indian Government’s approac h to adopting wood construction codes and 
standards? 
 
Reply:  BIS develops standards on Wood Products un der the Wood and other lignocellulosic products 
Sectional Committee CED 20, Doors, Widows & S hutters Sectional Committee CED 11and Timber 
& Timber Stores Sectional Committee CED 9 of Civil Engineering Division Council. These standards are voluntary in nature.  This section of the Secretariat report also states that BIS is India’s WTO/TBT Enquiry Point; however, no information is provided re garding BIS’ notification procedures. 
 
(e) Could India please explain how authorities (e.g. WTO Enquiry Point) monitor the creation or 
modification of TBT measures nationally in order to determine whether to notify WTO Members of 
draft or modified measures in keeping with the transparency obligations established by TBT 
Agreement?   
Reply:  Normally, a policy decision is taken only in  consultation with the relevant Ministries.  BIS is 
the Regulatory body for products under mandatory certif ication. If the measure is considered trade WT/TPR/M/182/Add.1 
Page 254  
 
  affecting, the same is duly notified to the WTO to enable different Member countries to provide their 
comments. 
(f) Additionally, when a determination is m ade to make a WTO notification, what is the 
mechanism used to prepare it (e.g. interdepar tmental/inter-ministerial collaboration, etc.)? 
 
Reply: The Departemnt of Commerce is the National Notification Authority. Notifications are 
preapred by the respective Departments after due cons ulation with the variuos stakeholders and then 
forwarded to the Department of Comm erce for notifying them to the  WTO. 
 
(g) Could India please indicate what steps are be ing taken to ensure that, in keeping with the 
TBT Committee’s Recommendation on the normal time  limit for comments on notifications, 60 days 
are provided to Members to co mment on draft notifications under normal circumstances, and that 
comments submitted by Members are taken into account.   
Reply:  Normally 60 days time is provided for comments as per WTO norms. Sometimes if the 
comment period is not adequate, it is extended.  
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requi rements, Paragraph 50, page 51: 
 
According to the Secretariat report BIS has concl uded a number of bilatera l cooperation agreements, 
some of which contain provisions for mutual accepta nce of test reports and inspection reports. In 
addition, this section of the Secretariat Report notes that BIS has established Memoranda of 
Understanding (MOU) with a number of countries su ch as Germany, Brazil and the United States.  
 
6. (a) Could India provide a list of the bilat eral cooperation agreements that BIS has signed 
which contain provisions for mutual ac ceptance of test and inspection reports?  
 
Reply:  BIS has signed bilateral cooperation agreemen ts with the following countries which have 
provisions for mutual acceptance of test  and inspection reports : 
 Sri Lanka 
 Israel 
 
(b) Could India provide information on the nature and coverage of the MOUs that BIS? 
 Reply:  The MOUs signed by BIS with NSBs of  most of the countries cover cooperation and 
exchange of information and personnel in the fiel d of standardization, conformity assessment and 
training. The MOU with ISO covers the use of trai ning institute of BIS as a regional training centre of 
ISO for hosting regional and international traini ngs/ workshops/ seminars. The MOU with Bhutan 
covers cooperation for operation of BI S Certification Scheme in Bhutan. 
 
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (a) Standards, paragraph 52, page 52: 
 
The Secretariat Report notes that BIS develops sta ndards through 14 Division Councils and that draft 
standards are published for comments on the BIS website for not less than one month.  7. Could India please identify the policies BIS has in place to ensure that a 60 day comment 
period is provided for all draft standards as stipul ated by the Code of Good Practice (Annex 3 of the 
TBT Agreement)?  WT/TPR/M/182/Add.1 
 Page 255 
 
 
  Reply:  A mechanism has been institute d so as to provide comments on th e draft notifications within 
60 days. BIS is the corordinating agency for that.    Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (a) Standards, paragraph 53, page 52: 
 According to the Secretariat Report, 5,821 of the 18 ,300 standards (approximately) that are in place 
in India have corresponding ISO/IEC standards and of  these, 4,307 (or 73%) are harmonized with 
ISO/IEC standards. This section of the Report also states that India is expediting its review process of 
existing standards and that a greater number of sector al standards, including in the area of electrical 
safety, tend to be aligned with ISO/IEC standards.  8. (a) How many of India’s 18,300 (app roximate) standards were developed by BIS? 
 
Reply:  All Indian standards are developed by BIS. Many of these standards may be based on ISO/IEC 
standards. 
 
9. Are India’s electrical safety standards based on ISO/IEC standards? 
 Reply: All Electrical Safety standards for equipment and appliances are based on  ISO/IEC standards 
either as identical standards (dual no.) or  harmonised with the ISO/IEC standards. 
 
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (b) Pr oduct Certification, paragraph 54, page 52: 
 
According to the Secretariat Report, BIS operat es as both a standards development organization and 
a certification program under which it manages th e application of the Bureau of Indian Standard 
Mark (ISI). The ISI mark is granted to products both on a voluntary and mandatory basis. There are 
66 products which must receive ISI certification due  to health and safety concerns (i.e. where its 
application is mandatory). Manufacturers, including foreign manufacturers, are able to apply the ISI 
mark if they have been certified by BIS. And, BIS has been designated as a National Certification 
Body for recognizing and issuing certificates under the IECEE CB Scheme.  10. (a) Could India explain how BIS’ standards d evelopment body and its conformity assessment 
body operate as distinct, separate and independ ent entities in keeping with international best 
practices for good governance?   
Reply:  The standards development wing and its conf ormity assessment body of BIS are distinct, 
separate and independent entities.  
 
(b) Could India indicate if BIS has been accredited to ISO/IEC Guide 65, the international 
conformity assessment standard for bodies operating product certification programs?  
 
Reply:  The product certification scheme being operated by BIS is as per ISO/ IEC Guide 65. The 
scheme has not been accredited to ISO/ IEC Guide 65 . However, steps are being initiated to get the 
scheme accredited to ISO/ IEC Guide 65. 
 
© Does India recognize testing and certification by foreign certification bodies to India’s mandatory 
requirements? 
 
Reply:  Presently, India does not recognize testing and certification carried out by foreign certification 
bodies. However, it can be accepted if  these bodi es are designated as agents under an MRA or 
otherwise. WT/TPR/M/182/Add.1 
Page 256  
 
  (c) Could India please provide a list of the 66 products that require ISI certification? 
 
Reply: Presently, there are 68 products which are under mandatory certification of BIS. The list of 
these products is availabe at th e BIS Website : www.bis.org.in.  
 (d) Is the ISI mark designed for the purposes of health and safety?  
 
Reply: The ISI mark on a product indicates that the product conforms to the requirements of the 
relevant Indian standard which includes health a nd safety, as applicable. Wherever, there are separate 
Indian Standards available for Safety requirements, th e  word ‘safety’ is indicated at the bottom of the 
ISI mark for such products. 
 
(e) Given that the ISI mark is applied both in a voluntary and mandatory fashion; could India 
indicate how consumers distinguish between produc ts which must contain the ISI mark and those 
which do not? 
 
Reply: Currently, there is no mechanism built into th e mark to distinguish between voluntary and 
mandatory products.  
(f) Could India please explain to what extent it recognizes certificates issued by other National 
Certification Bodies under the IECEE CB Scheme?  
 
Reply: India accepts Certification Bodies (CB) test certificates issued by the National Certification 
Bodies of other countries under the CB scheme for the electrical products covered in the scope of BIS 
approval for the purpose of grant of BIS Certificat ion Licence. The website of IECEE may also be 
referred to for getting more informa tion on the scope of BIS approval. 
 
Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 56, page 54: 
 
Mention is made in paragraph of 56 of the va rious Indian WTO/SPS Enquiry Points; however, no 
information is provided regarding th e coordination among these authorities.   
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, 
(xi) Standards and other technical requirements, (a ) Standards, page 50, paragraph 48, and (xii) 
Sanitary and phytosanitary meas ures, paragraph 62, page 55: 
 
Canada understands that only some low technology medical devices are certified by BIS, while 
some sterile devices are regulated under the Drugs  and Cosmetics Act, and certain medical imaging 
devices are regulated by the Atomic Energy Regulatory Board.  (a) Could India please provide greater clarity  with respect to existing standards and other 
technical requirements applicable to medical equipment/devices?   
 
(b) Would India please identify what steps it is  taking to harmonize its regulation of medical 
devices with international best practice approac hes, such as those recommended by the Global 
Harmonization Task Force (GHTF)? 
 Reply: The regulation of medical devices is governed by the Directorate General of Health Services 
under the Ministry of Health & Family Welfare. BI S has formulated 857 Indian standards related to 
Medical Devices. Out of these, 134 Indian standard s are aligned with ISO/IEC standards. Further 
steps are being taken to harmonize Indian standard s with ISO/IEC standards, wherever possible.  
  WT/TPR/M/182/Add.1 
 Page 257 
 
 
  Part IV – Trade Policies by Sector, (5) Services, (iii) Financial Services, © Securities, Paragraph 
112, page 133:  Paragraph 112 of the Secretariat’s rep ort states that FIIs may invest in all types of securities, but are 
generally restricted to 24% of a company’s paid-up capital. 
 
Q. (a) Could India explain whether the 24% li mit represents an individual or aggregate FII 
investment threshold and if the limit is an aggregate level of FII investment, could India indicate 
whether any individual FII limits apply ? (SEBI)  
Reply The 24% limit represents the total investment acros s all FIIs in any company’s paid-up capital.  
This limit as per provision of FEMA 1999, can be in creased to the sectoral cap / statutory limit as 
applicable to the Indian company concerned, by  passing a resolution of its Board of Directors 
followed by a special resolution to that effect by its General Body.    
Further, the individual limits prescribed by  SEBI (FII) Regulations, 1995 are as follows: 
 (a) The purchase of equity shares of each company by  a Foreign Institutional Investor investing 
on his own account shall not exceed ten per cent of  the total issued capital of that company. 
 (b) In respect of a Foreign Institutional Investor  investing in equity shares of a company on 
behalf of his sub-accounts, the investment on behalf of each sub-account shall not exceed ten 
per cent of the total issued capital of that company provided that in the case of foreign 
corporates or individuals, each of such sub-account shall not invest more than 5% of the total 
issued capital of the company in which such investment is made. 
 India ratified the Cartagena Protocol on Biosafety (BSP) in 2003. Canada would be interested in 
finding out what India's plans are with respect to  implementation of its obligations under the BSP. 
(Ministry of Environment)  1. Will India be notifying the WTO once any new regul ations with respect to its BSP obligations 
are developed? 
 Reply: The Ministry of Environment & Forests has notified the Rules, 1989 Rules for the   
manufacture, Use/Import/Export and Storage of Haza rdous MicroOrganisms/ Genetically Engineered 
Organisms or Cells, in 1989 under the Environmental (P rotection) Act, 1986.  It is available at the 
website: envfor.nic.in 
 
Report by the Government (WT/TPR/G/182) 
 Part III – Developments in Trade Policy and Co ntinuous Liberalisation of Tariffs, paragraph 
60, page 15: 
 
Paragraph 60 of the Government Report indicat es that India has been working to liberalize their 
import policies.  However, Indian tariffs on imported lumber and value-adde d wood products remain 
high.     2. Could India please explain the reasons for c ontinuing to have high tariffs on these items? 
 
Reply: Tariff on timber is only 5% whereas on va lue added products, the tariff is 10%. 
 WT/TPR/M/182/Add.1 
Page 258  
 
  Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, 
(iii) Tariffs, (a) Overview, paragraph 21, page 38:  The Secretariat Report states that, “the applied tar iff is complex in addition to being announced with 
the annual Budget, rates are changed on an ad ho c basis through gazette notifications, with the 
approval of Parliament; numerous  exemptions render the system co mplex to administer, and therefore 
more susceptible to administrative discretion."     3. (a) Could India indicate whether there are plans to simplify their applied tariff regime in the 
near future? 
 Reply: India’s tax regime is fairly simple and transpar ent. Most of the non-agricultural goods attract a 
uniform tariff. In addition, imported goods are char ged to additional duties in lieu of excise duty and 
state/local taxes  
India has been applying a different tariff regime for refined canola oil as it has for 
substitutable products - namely refined soybean and sunflower oil.  The current applied tariff on 
refined soybean oil is 45%, and the recently announ ced reduction of tariff for refined sunflower oil 
will bring the latter down to 60%.  Meanwhile, the tari ff for refined canola oil is still at 75% and there 
has been no indications that it would be lowere d to be brought in line with like-products.  
 
(b) Could India please explain why it is applying a different and discriminatory treatment to 
refined canola oil? 
 
Reply:  The tariff on canola oil is within ceiling bindings . The Government decides the applicable rate 
of tariff on various types of oils having regard to the concerns of all sectors. 
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, (iii) Tariffs, (c) Applied MFN tariff, paragraph 25, page 39-40:  The Secretariat Report states that "in addition to customs duty, importers are required to pay an additional duty (countervailing duty) and a special additional duty in place of local taxes."  
Regarding the wine and spirits duty regime , the European Communities (EC) and the US claim that 
India applies "additional duties" and "extra duties" on wine and spirits imports from their countries 
in excess of India's obligations under the GATT 1994.    4. Could India comment on the rationale for its wi ne and spirits duty regime and its consistency 
with India's WTO obligations?  
Reply:  It would not be desirable to make any comme nts as the matter is now with the Dispute 
Settlement Body in WTO.  
Part II -Framework and Objectives, (4) Foreign  Investment Regime, (i) Overview, paragraph 
38, page 29: 
 The Secretariat Report notes that the Foreign In vestment Implementation Authority (FIIA) was 
established and provided with "Fast Track Authority " in order to address constraints, such as 
the complexity of procedural requirements and a lack of transparency in approval processes, which 
have in the past resulted in lower levels of FD I than could have reasonably been expected.   
 
(a) Could India comment on the impact that the creation of the FIIA has had on addressing the 
abovementioned impediments to FDI?   WT/TPR/M/182/Add.1 
 Page 259 
 
 
  (b) Could India please also elaborate on the spec ifics of the FIIA's "Fast Track Authority"? 
 
Reply to Qs (a) and (b): As and when a foreign investor requires the Government to remove 
impediments to implementation of their projects, efforts are made to facilitate the same.  Part II - Framework and Objectives, (4) Fore ign Investment Regime, (ii) Legislation and 
approval procedures, paragraph 43, page 30:  The Secretariat Report indicates that according to  Indian officials, 90% of decisions related to 
investment proposals submitted to the Foreign Investment Promotion Board (FIPB) are 
communicated to potential investors within 4-6 we eks.  The Report also notes that subsequent to 
receiving a positive decision from the FIPB, approval from other central or state government agencies must often be sought by the investor.    Given the length of time currently required to comp lete the review and approval process, could India 
please indicate what steps (in addition to the measures outlined in the report) are being 
taken/contemplated in order to reduce the amount of time associated with the review and processing 
of investment proposals? 
 
Reply: The extant policy permits FDI in most sectors on the automatic route where no prior approval 
of the Government is required. The policy review ov er the last few years has increased the number of 
sectors where FDI is permitted on the automatic route. 
 
Part III- Trade Policy and Practices by Measures, (4) Measures affecting production and Trade, 
(v) Intellectual Property Rights,(a) Overview, paragraph 154, page 84  
Canada notes that according to the Secretariat’s Report “there are proposals to further amend the 
Indian Copyright Act in the light of the WIPO’s WCT and WPPT treaties.” Could India please provide more information regarding the proposals to amend the Copyright Act and when it foresees 
that the Copyright Act will be amended?  
Reply:  No such time frame can be set in view of the Parliamentary approval required to be obtained 
in respect of any law. The process of stakeholder co nsultation as a part of the process of amending the 
Copyright Act is currently on. The suggestions  received from various sectors along with the 
comments/ suggestions received from other stakeholders  is being carried out by the expert/ technical 
committees constituted for the purpose.  India has one of the modern copyright laws in the world and 
the amendments made in the Indian Copyright Act from time to time had ensured that it was fully 
TRIPS complaint. Though India has not yet accede d to the two internet treaties namely, WIPO 
Copyright Treaty (WCT) and WIPO Performances a nd Phonograms Treaty (WPPT), the process is on 
for amending the Copyright Act with a view, inter al ia, to explore the possibilities of incorporating the 
relevant provisions of the two treaties in the Copyright Act, 1957. 
 
Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (IV) Intellectual property rights, (b) Indus trial property, Patents, paragraph 157, page 
85:  
 
Canada notes that according to the Secretariat Repo rt  “[f]or patents relating to pharmaceuticals 
filed before 1 January 2005 (the "Mailbox"), the righ ts of the patentee accrue from the date of grant 
of the patent, but the period of protection remains 20 years from the date of filing.  Moreover, the 
patent holder may not institute infringement pr oceedings against manufacturers already producing 
the patented product when the patent is granted; in  such cases, the patent holder is entitled to receive 
reasonable royalties. The law does not define "reaso nable", which depends on the circumstances of WT/TPR/M/182/Add.1 
Page 260  
 
  each case, like royalty payment under Article 31 (h) of the TRIPS Agreement. ” The Secretariat 
Report also notes that “[t]he law also does not define the authority for determining the royalty.”   
 
Could India please elaborate upon who determines the royalties due to the patent holder?  
 Reply: Exclusive Marketing Right (EMR) provisi on was provided for giving protection to 
pharmaceutical products which were to be provide d patent protection as per the TRIPS Agreement 
(Mail-box applications). Four EMRs were grante d on the products of the following companies: 
♦ United Phosphorus Ltd 
♦ Novartis AG, Switzerland 
♦ Wokhardt Ltd 
♦ Eli Lilly 
 
 The provision under section 11 A (7) provides for protection of the right of the patent holder 
in respect of the mail-box application accruing from the date of grant of the patent which is 
compatible with Article 70.8 (c) and with Article  28 of the TRIPS Agreement. Applicant for the mail-
box application had an opportunity to avail of th e Exclusive Marketing Right during the transition 
period and enjoy the patent right after the grant of  patent. Determination of royalty is a commercial 
decision between the two parties. Any dispute rela ting to reasonableness of royalty can be brought to 
court for settlement. 
 
Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (V) Intellectual property rights, (b) I ndustrial property, Trade marks, paragraph 164, 
page 87: () 
 
Canada notes that according to the Secretariat Repo rt “[r]egistration is not compulsory, but the 
owner cannot bring a legal case against an infring er if the mark is not registered. The law also 
enables a suit for passing off to be filed for the use of  any trade mark that is identical or deceptively 
similar to the plaintiff's trade ma rk, whether registered or unregist ered.” The first sentence seems to 
prohibit legal cases for all unregis tered trademarks while the second allo ws suits in some instances 
such as passing off of unregistered trademarks.   
  (a) Canada would be grateful if India could clarify  the limitations on the right to bring legal 
cases for unregistered trademarks.    
(b) Would India please identify if there are additional instances (i.e. other than passing off) in 
which the owner of an unregistered trademark can bring suit? 
 
Reply: The inference that an unregistered trade mark  owner cannot bring a legal case against an 
infringer is unfounded.  Section 27 of the Trade Marks Act provides that no infringement action will 
lie in respect of an unregistered trade mark, but  recognizes the common law rights of the trade mark 
owner to take action against any person for passing  off goods as the goods of  another person or as 
services provided by another person or the remedies thereof.    Registration confers the exclusive right to th e use of the mark in relation to particular 
goods/services and initiate infringement action.  But common law rights are not affected and civil 
suits and passing off action can also be initiated.  
 There is no limit on the right to bring legal cases fo r unregistered trade marks. Suits may be filed:-  
 
♦ Irrespective of whether the plaintiff is  carrying on business in the relevant 
jurisdiction;  WT/TPR/M/182/Add.1 
 Page 261 
 
 
  ♦ With respect to misrepresentation as to quality; 
♦ Where there is a real possibility of damage to business or trading activities; 
♦ In cases involving loss of control ove r goodwill or damage to goodwill; 
♦ Where the accused tarnishes the reputation of  the plaintiff’s trade marks diluting its 
commercial magnetism; 
♦ In cases relating to: 
 
o Commercial endorsement of well known personalities. 
o Similarities in getup etc.  
o Similarities in idea or when translated the meaning of the word is the same.  
 
♦ Some Indian case laws  which are illustra tive of the court verdicts on the cases of 
trademarks are mentioned below:  
 
i) “Andal” was held to be deceptively si milar to “Ambal” (reported in AIR 170 
SC 46). 
ii) “Simatul” was held as likely to cause confusion and deceptively similar to 
“Cibatul” (reported in AIR 1978 Gujarat 216). 
iii) “TREVICOL” was held to have phonetically deceptive similarity to 
“FEVICOL” (reported in AIR 1989 Delhi 155). 
iv) “BEPLEX” and “BELPLEX” are phonetically and visually similar and likely 
to create confusion and deceptively similar (reported in AIR 1984 Punjab & 
Haryana High Court 430). 
v) “Pizza Hut” and “Pizza Ghar” held to be similar (reported in Kiran Gupta v 
Pizza Hut International 2004(28) PTC 279). 
 
Part III- Trade Policy and Practices by Measures, (4) Measures affecting production and Trade, 
(v) Intellectual Property Rights,(a) Overview, paragraph 169, page 88  Canada notes that according to the Secretariat’s Report “(c)ompulsory licenses may be issued for 
works withheld from the public or for unpublishe d “ Indian works”, where the author is dead or 
unknown. In such cases applications may e made to  the copyright board, which after holding an 
inquiry, may direct the Registrar of Copyright  to issue the licence under specified terms and 
conditions.”  2. Could India please advise what steps are ta ken to identify the copyright holder before a 
compulsory license is issued? 
 
Reply: The provisions relating to licensing of the rights comprised in the Copyright in a work are 
contained in Sections 30 to 32 B of the Copyright Act, 1957. The owner of a copyright may grant an interest in the copyright by license. The license is  an authorization of an act which, without such 
authorization, would be an infringement. The license ma y be confined to one or more interests or to 
the entire copyright. The license may be of exclusiv e or non-exclusive nature; it may be granted by 
the owner or granted by the Copyright  Board as a compulsory license etc. 
 
Part III - Trade Policy and Practices by Measu re, (4) Measures Affecting Production and 
Trade, (V) Intellectual property rights, (d) Other Intellectual Property, Trade secrets, paragraph 182, page 91:  
 
The Secretariat Report states that “[t]here is no speci fic legislation regulating the protection of trade 
secrets nor enforcement measures/penalties for viol ations of trade secrets.  However, aggrieved 
parties can seek action through the Civil Courts.”    WT/TPR/M/182/Add.1 
Page 262  
 
  Would India please detail what actions can be taken by aggrieved parties in Civil Court in the 
absence of specific legislation?   
Reply: The existing laws, namely the Drugs and Cosme tics Act and the Insecticides Act provide data 
protection. The Indian Government is presently examin ing the extent of change that would be needed 
in these laws to give protection against unfair use of  clinical test data submitted to the regulators. 
 
Part IV – Trade Policies by Sector, (2) Agricult ure, (ii) Agricultural Policies, (a) General 
Framework, paragraph 15, page 103:   
Canada notes India's strong desire to see increase growth in the agricultural sector at all levels of the 
value chain, including the production, processing and di stribution levels.  How ever, there has been no 
sign of allowing greater foreign partic ipation in the retail sector.   
 Would India please explain to what extent it intends to remove the barriers to foreign direct 
investment in the food retail sector?  
Reply: FDI up to 100% is permitted under the automa tic route in wholesale/cash & carry trading, 
including business-to-business sales. FDI up to 100 % is permitted under the automatic route for 
Storage and Warehousing services including warehousi ng of agricultural products with refrigeration 
(cold storage). FDI up to 100% is  permitted on the automatic route in Floriculture, Horticulture, 
Development of Seeds, Animal Husbandry, Pisicu lture, and Cultivation of Vegetables, Mushrooms 
under controlled conditions and services related to agro and allied sectors. 
 
Part IV -Trade Policies by Sector, (4) Manuf acturing; (iv) Information Technology (IT), 
paragraph 86, page 125: 
 
The Secretariat notes that FDI of up to 100% through the automatic route is permitted in electronics 
and information technology hardware manufacturi ng, software development, and ITES sector, except 
business-to-consumer (B2C) e-commerce.   (a) Could India provide further information on what is meant by the “automatic route”? 
 
(b) Could India please provide information on the FDI threshold for B2C e-commerce?  
 (c) Could India please provide further detail on wh y B2C is subject to a different FDI threshold 
than other IT sub-sectors?  
 
Reply:  In most sectors FDI is permitted on the automatic  route. FDI in such sectors/activities does not 
require any prior approval and only requires notifica tion to the Reserve Bank of India within thirty 
days of such receipt of inward remittance; and fili ng required documents within thirty days of issue of 
shares to foreign investors.  FEMA Regulations  prescribe specific formats for notifying foreign 
investments, transfer of sh ares to non-residents and payment for foreign technology/use of 
trademark/brand name made under the automatic route.  
 FDI is not allowed in B2C e-commerce.  
Part IV - Trade Policies by Sector, (5) Services,  (v) Transport, (c) Air transport, paragraphs 
150-153, pages 142 and 143:     
5. Canada would be appreciative if India could prov ide detailed information about the plans of 
the Indian government to address the issue of congesti on at India's main airports in the coming years.   WT/TPR/M/182/Add.1 
 Page 263 
 
 
  Reply:  There is congestion at Delhi and Mumbai air ports during the peak hours. To reduce the air 
traffic congestion at these airports, the measures that are being taken/ to be taken include construction 
of new high speed exit taxiways, simultaneous u se of both runways, improved ATC procedures, 
restriction on general aviation aircraft movement , introduction of ATC automation system etc. 
Besides these short term measures, all major ai rports in the country are being taken up for 
modernization and development for creati ng significant capacities on the air-side. 
 
Part IV - Trade Policies by Sector, (5) Services, (v) Transport, (c)Air tr ansport, paragraph 156, 
page 144:  
 
6. Could India please provide detailed information abo ut the legislative regime in place in India 
governing the foreign ownership level in Indian air carriers?  
 
Reply:  FDI limits in air transport services (domestic  airlines) are notified through Press Notes from 
time to time. The existing FDI limits notified on 10.11.2004 is as under:  
♦ 49% through the automatic route  
♦ 100% by Non-resident Indians through the automatic route  
♦ No direct or indirect equity participation by foreign airlines allowed.  
 
Part IV - Trade Policies by Sector, (5) Services,  (v) Transport, (c) Air transport, paragraphs 
160-161, page 144: 
 
7. Could India please provide Canada with detailed information about any recent or 
contemplated changes to India's international air policy?   
Reply: Government proposes to review its bilateral Ai r Services Agreements with other Countries 
and gradually move towards greater liberalization on a reciprocal basis.  It also proposes to increase market segments for Indian carriers by entering into  agreements with origin al and multi-lateral groups 
having a similar agenda of liberalization. 
Part IV- Trade Policies by sctors,(5) Services), (iii) Financail services,banking, paragraph 94, 
page 128:  Paragraph 94 of the Secretariat's report indicates that the level of non-performing assets (NPAs) in 
priority sector lending has declined in recent years.  
 
32. Could India please identify if the level of NPAs  in priority sectors is higher than non-priority 
sectors?  Reply:  
• Gross NPAs, as a percentage of gross advances, in both priority and non-priority sectors have 
declined consistently in recent years. This dec line has been more in the case of priority sector 
advances. 
• In relation to gross advances, the percentage of  NPAs in the priority sector advances has all 
along been higher than that in non-priority sector.  
• At the system level, the share of priority sect or (gross) NPAs has increased over the years.  
• The absolute level of gross NPAs in the prio rity sector, which had been steadily decreasing 
over the past few years, has recorded an increase over 2006-07.  
 
Relatively lower reduction in priority sector NPAs  compared to non-priority sector NPAs has 
contributed to the increase in the share of priority sector’s NPAs in total NPAs of the system. This WT/TPR/M/182/Add.1 
Page 264  
 
  would be accentuated by the aggressive write-off / restructuring / recovery programmes pursued by 
banks in respect of their big-ticket non-priority sect or advances, and their in centive to retain even 
problem priority sector loans on their books for meeti ng Priority Sector lending targets. Consequently, 
the increasing share of Priority S ector. NPAs in the overall NPAs need not imply inherently higher 
delinquency of Priority Sector advances. 
 
The proportion of gross NPAs in priority sector advances has historically been higher than the corresponding figure for non-priority sector advan ces, the difference in proportion has been steadily 
narrowing over the past few years.  Part IV - Trade Policies by Sector, (5) Services,  (iii) Financial Services, (a) Banking, paragraph 
97, page 129: 
 
Paragraph 97 of the Secretariat Report indicates that the requirement for banks to implement the 
Basel II capital adequacy framework by Ma rch 2007 has been postponed by one year. 
 
33.(a) Could India provide an explanation for the delay?  
Reply: Initially, the Reserve Bank of India had indicat ed March 31, 2007 as the intended date for 
adoption of Basel II by the commercial banks in India.    
 
 In October 2006,  taking into account the state of preparedness of the banking system, it has 
been decided to provide some more time to the banks to put in place appropriate systems so as to 
ensure full compliance with Basel II norms. Accordingly:  
a) Foreign banks operating in India and Indian banks having operational presence outside India 
are to migrate to the standardi sed approach for credit risk and the basic indicator approach for 
operational risk under Basel II with  effect from March 31, 2008. 
 
b) All other scheduled commercial banks are en couraged to migrate to these approaches under 
Basel II in alignment with them but in  any case not later than March 31, 2009. 
 Paragraph 97 also indicates that the pilot project on risk-based supervision will continue. 
 (b) Would India please identify if the proj ect will be expanded to more than 23 banks? 
 
Reply: Risk Based supervision (RBS) was introduced on a pilot basis in eight selected banks in 2003-
04, which was extended to twenty one more banks during the years 2004-05, 2005-06 and 2006-07. In 
addition, in case of six banks, the on-site pilot RBS process was repeated to  assess the preparedness of 
those banks for switch over to exclusive RBS in future .  Several measures were also taken to fine tune 
the RBS process on the basis of experience gained. The pilot RBS is incidentally in addition to the 
Annual Financial Inspection (AFI),  which is generally undertaken  for all banks annually under 
CAMELS pattern.  
 
 As is apparent, 29 banks have already been c overed under RBS process during last four years, 
besides repetition of RBS in respect of six banks. In  future also, more banks are likely to be covered 
under pilot RBS till the process gets stabilised. 
 
(c) By being chosen for this project, could I ndia explain if these banks enjoy an advantage with 
respect to their competitors (e .g. less regulatory burden)? 
 
Reply: The present RBS inspection is in the nature of a pilot study and, therefore, it is a full scope 
inspection covering all the areas, notwithstanding th e level and direction of risk in various areas.  WT/TPR/M/182/Add.1 
 Page 265 
 
 
  Consequently, at present, banks do not enjoy any advantage (i.e. less regulatory burden) as per their 
risk profile.  
 
Part IV - Trade Policies by Sector, (5) Services,  (iii) Financial Services, (a) Banking, paragraph 
98, page 129: 
 
The Secretariat Report indicates that the bill to am end the Banking Regulatio n Act is currently in 
Parliament. Canada understands that a similar bill wa s in Parliament in 2005, which was met with 
significant opposition.    
34. (a) Would India please elaborate on any differences between the    two proposed bills? 
 (b) Could India clarify when this bill is expected to become law? 
 Reply: 
 (a) The Bill currently in the Par liament is the same Amendment B ill that had been tabled in the 
Parliament in 2005. Only in the meantime, an amen dment regarding the removal of the lower limit on 
Statutory Liquidity Ratio was effected indepe ndently by way of an ordinance and received 
Presidential assent in March 2007.     
(b) The Amendment Bill will become a law afte r it has been passed by both the Houses of 
Parliament and has received the assent of the President.   
Part IV - Trade Policies by Sector, (5) Services,  (iii) Financial Services, (a) Banking, paragraph 
99, page 130: 
 
Paragraph 99 of the Secretariat Report indicates t hat foreign banks may be permitted to enter into 
mergers and acquisitions with private banks in India, subject to a 74% overall investment limit, as of 
April 2009.   35. (a) Could India clarify whether such mergers and ac quisitions would also be subject to any of 
the individual ownership limits India maintains? 
 
Reply: As per the road map for the pres ence of foreign banks in India, a two-track approach will be 
adopted. One track is the consolidation of the domestic banking system in both public and private 
sectors. The second track is the gradual enhan cement of the presence of foreign banks in a 
synchronised manner. The first phase  would commence from March 2005 to March 2009. The 
second phase would commence from April 2009. In th e second phase, the removal of limitations on 
the operations of the Wholly Owned Subsidiaries an d treating them on par with domestic banks to the 
extent appropriate will be designed and implemente d after reviewing the experience with Phase I and 
after due consultations with all st akeholders in the banking sector.   
 
In considering an application made by a forei gn bank, for acquisition of 5 % or more in the 
private bank, RBI will take into account the standi ng and reputation of the foreign bank, globally as 
well as in India, and the desired level and nature of presence of the foreign bank in India. RBI may, if 
it is satisfied that such investment  by the foreign bank concerned will be in the long-term interest of 
all the stakeholders in the investee bank, permit acquis ition of such percentage as it may deem fit.    
 Paragraph 99 of the Secretariat Report also indicates that the 49% limit on private-sector 
banks will remain until 2009.  b) Does India expect that this restriction will be raised in 2009? WT/TPR/M/182/Add.1 
Page 266  
 
  Reply: Currently there is a limit of 10 per cent for individual FII investment with the aggregate limit 
for all FIIs restricted to 24 per cent, which can  be raised to 49 per cent with the approval of 
Board/General Body.   
 
Part IV - Trade Policies by Sector, (5) Services,  (iii) Financial Services, (a) Banking, paragraph 
101, page 130:  
Paragraph 101 indicates that  recommendations regarding cor porate governance issues were 
submitted in 2002.  
36. (a) Could India please define the ot her recommendations in the report? 
 (b) Would India please elaborate on if the RBI is planning to implement any of these recommendations in the near future?  
Reply: 
 
In terms of Circular DBOD.No. BC.116/08.139.001/2001-02 dated 20.06.2002, the Report of the 
Consultative Group of Directors of Banks / Financ ial Institutions (Dr.Ganguly Group) was forwarded 
to all scheduled commercial banks advising them to implement the recommendations based on the decision taken by the Board. The recommendations comprised: 
 
i) Responsibilities of the Board of Directors.  
ii) Role and Responsibility of Independe nt and non-executive directors. 
iii) Training facilities for directors 
iv) Submission of routine information to the Board. 
v) Agenda and minutes of the board meeting  
vi) Committees of the Board. 
vii) Disclosure and transparency 
viii) Information flow 
ix) Appointment of Company secretary 
x) Eligibility and 'fit and proper ' norms for nomination of directors. 
xi) Commonality of directors of banks and NBFC 
xii) Composition of the Board. 
 
Further, RBI directed the banks in priv ate sectors vide Directive DBOD.No. BC. 
104/08.139.001/2003-04 dated June 25, 2004 to undertake a process of due diligence to determine the 
suitability of the person for appointment/continuing  to hold appointment as director based upon 
qualification, expertise, track record, integrity and other 'Fit and proper' criteria, based on the 
information provided in the signed declaration and to  ensure that the directors execute the deed of 
covenants as recommended by the (Dr.Ganguly Group) Committee. 
Part IV - Trade Policies by Sector, (5) Servi ces, (iii) Financial Services, (b) Insurance, 
paragraph 106, 131: 
 
Paragraph 106 indicates that foreign investment is restricted to 26% in insurance.  In the banking 
sector, the limit is 49%. 
37. Could India please identify if there is a policy rea son for the different ownership restrictions?  
 
Reply: In case of private sector banks, the limit for fore ign investments is 74 percent and within this 
limit there is a sub limit of 49 percent for investme nts by Foreign Institutional Investors. Foreign  WT/TPR/M/182/Add.1 
 Page 267 
 
 
  Investments in case of Public Sector Banks (PSB) is restricted to 20 percent [a Statutory Limit 
imposed under the Banking Companies (Acquis ition and Transfer of Undertakings) Act].  
  The limits for foreign investments would be determined in the various sectors based on the 
sectoral policy approved by the Government; consid eration of the various aspects; the statutory 
requirements laid down by law for foreign invest ments in the sector and the level of regulatory 
comfort in allowing foreign investments and fo reign ownership and control in a given sector. 
 
Part IV - Trade Policies by Sector, (5 ) Services, (iii) Financial Services,  
 
Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 57, page 54: 
 The Secretariat’s Report states that, “in an attemp t to streamline SPS pro cedures and enforcement, 
the Food Safety and Standards Act wa s passed by Parliament in August 2006, although it is yet to be 
enforced”.   
 8. (a) Could India please explain what the required  steps in enforcing the legislation are?  
 
Reply:  The provisions of Food Safety and Standard  Act, 2006 will be enforced through the Food 
Safety Officers within their respective areas of jurisdiction.  
 
(b) Will India be implementing regulations to enforce the legislation? 
 
Reply:  The various provisions of the Food Safety and Standard Act, 2006 will be brought into effect 
through the notifications.  
 
(c) Will India be notifying the WTO SPS Committe e of any changes to its SPS measures resulting 
from the legislation and/or regulations?  
Reply: If any change is brought about, the same will be notified to the WTO. 
 Part IV - Trade Policies by Sector, (4) Manufa cturing; (iv) Information Technology (IT), 
paragraph 85, page 125: 
 
The Secretariat Report notes that the information t echnology (IT) industry is comprised of software 
development, IT enabled services (ITES), bus iness process outsourcing (BPO), and hardware 
manufacture. 
 9. Could India please provide further detail on how ITES is defined? 
 
Reply:  ITES includes any thing that uses Information Tec hnology to enable customer services such as 
Back Office Operations, Customer Interac tion Services, including call centers, medical 
transcription/translation etc. 
 
Part VIII - India and the WTO, (b) Services, paragraph 152, page 31: 
 The Government Report notes that within the GATS context, India is seeking improved modal 
commitments from developed countries in Cross Border Supply of Services (Mode 1), and that these 
objectives are driven by its strong competitive ed ge in Information Tec hnology and Information 
Technology Enabled Services. Canada notes, however, that India has not taken commitments in mode 
1 for Telecommunications Services.   WT/TPR/M/182/Add.1 
Page 268  
 
  10. Could India please provide further informa tion on the domestic sensitivities related to 
commitments in Mode 1 for Telecommunications Services?    
Reply:  The security measures stipulated in Press Note 3 (2007) are to be complied with by all the 
licensee. Security mechanism including monitoring is being strengthened for th is purpose. This Press 
Note is available on the following weblink: <http://siadipp.nic.in/policy/changes/pn3_2005.pdf> 
 
Q No Pg 178 of Report : Although a tariff rate quot a (TRQ) of 150,000 MT exists at 45% import duty 
for canola oil, Canadian exporters are unable to access th is quota. In fact, as illustrated in AIII.2, this 
quota has not been utilized at all since 2002/03.C ould India please explain the process for accessing 
the canola oil TRQ?  
 
Reply: All eligible entities desiring to avail the quota as mentioned above, may make application to 
Directorate General of Foreign Trade based on the requests or expression of interest (which is market driven) received from desirous importers. There is no delay in announcing the quotas. Further details 
of the TRQ administration are available at the website www.dgft.gov.in.  
 
Part II - Framework and Objectives, (4) Foreign Investment Regime, (iii) Incentives, paragraph 
44, page 31: 
 
The Secretariat Report notes that investors ma y receive a number of incentives for making an 
investment in a Special Economic Zones (SEZs).   
 11. Could India please elaborate on the incentives av ailable to investors who invest in a SEZ? 
 
Reply : The details are available at the website www.commerce.nic.in. 
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, (x) 
Contingency Measures, (a) Anti-dumping and countervailing measures, Measures, paragraphs 
41-49, page 49: 
  
The number of trade remedy cases being initiated by India continues to be very high and injury 
findings are very high in relation to the number of  cases initiated.  Canada notes that in certain 
sectors India suffers from inefficiencies due to infr astructure bottlenecks, high input and freight costs 
and the high cost of capital.    (a) Could India explain to what extent these fact ors, or economic factors other than imports, are 
taken into consideration during the inju ry phase of trade remedy investigations?  
 
(b) In addition, do Indian authorities see a co rrelation between efforts to address these problems 
and the number of trade remedy in vestigations being initiated?  
 
(c) Could India comment on the relationship be tween tariff levels and the number of trade 
remedy complaints and investigations?  
 
(d) Finally, do Indian authorities see a decline in the number of investigations in the short and 
medium terms?   
 
Reply : 
(a) In all anti-dumping investigations, any factor, including economic factors which may be 
contributing to injury of the domestic industry are examined.  The measures are imposed only after the Authority is satisfied that there is a causal li nk between dumped imports and injury caused to the 
domestic industry.  WT/TPR/M/182/Add.1 
 Page 269 
 
 
  (b) There does not appear to be any co-relation be tween factors causing injury to the domestic 
industry and number of trade remedy investigation being initiated.  (c) In India, tariff levels are falling consistently and there is no co-relation between trade remedy 
investigations initiated in India with the changing tariff levels. 
 Part IV - Trade Policies by Sector, (5) Servi ces, (ii) Commitments under the General Agreement 
on Trade in Services, paragraph 91, page 127:  
 
With regard to the statement in the Secretaria t Report on India’s current GATS commitments and its 
initial and revised offers, Canada seeks the following clarifications from India:  
 
3. Could India please explain if the following Mode 3 limitations in India’s schedule/offer are a reflection of India’s domestic legislative status  quo:  foreign equity limitations for engineering 
services, legal entity requirements for comput er and related-services, commercial presence 
restrictions for environmental services and foreign own ership in respect of travel agencies and tour 
operator services? 
 
Reply : For all the service sectors mentioned in the ques tion, India’s current  offer in Mode 3 is as 
follows:  
 
 “None, subject to incorporation of the conditi on that in the case of foreign investors having 
prior collaboration in that specific service sector  in India FIPB approval would be required.” 
  This restriction is compatible with the existing FDI guidelines for foreign investors. 
 
The horizontal limitation on taxation (added in India’s initial offer) states that “Taxation laws for 
domestic and foreign service suppliers, as per the prov isions of the Income tax Act, 1961, shall 
apply.”    12. Could India please provide for more clarity w ith respect to the new limitation in its revised 
offer relating to taxation?  
 
Reply: This is not a limitation but a mere statement of  the existing domestic re gulation prevailing in 
the country. 
 
13. (a) With respect to the temporary entry of business persons, does India's domestic regulatory 
regime allow for the spouses of qualifying Contract  Services Suppliers (both employees of a juridical 
person and independent professionals) and Intra-cor porate Transferees to work in India for the 
duration of their contract?    (b) If so, is this employment subject to a labour market test?    
(c) Would India consider binding this access in a revised GATS offer? 
 Reply:  Parts a) and b):  
Foreigners who are going to work in India, are e xpected to come to India with an employment visa 
(‘E’ Visa) from the Indian Mission abroad. Conversion of a Dependent Visa to ‘E’ Visa is normally based on reciprocity. However, in exceptional cas es, where such a conversion is allowed, the 
Employment Visa of the spouse is made co-terminus with the visa of the principal  visa  (‘E’ visa) holder, and not co-terminus with the term of the contract of the spouse.  WT/TPR/M/182/Add.1 
Page 270  
 
  Part c) 
India has one of the best Mode 4 offers on the table covering all categor ies of natural persons 
requested for by other countries. In view of the in adequate response received hitherto, India’s binding 
commitments would need to be calibrated against the final responses received from its major trading 
partners in Services. 
 
14. (a) With respect to the temporary entry of business persons, does India's domestic regulatory 
regime allow for a service supplier providing after-sal es or after-lease services in conjunction with a 
pre-existing contract to work in India without the re quirement of a labour market test or work permit?   
 
(b) If so, is India considering binding this access in a revised GATS offer? 
 Reply:  Part a): 
India’s domestic regulatory regime does not define access in terms of end use / activity. However, the 
specific categories prevailing in the regime and in cluded in its Revised Offer can provide access to 
persons wanting to undertake such activity in India,  depending on the nature of the contract and terms 
and conditions thereof.  
 
Part b): 
India has one of the best Mode 4 offers on the table covering all categor ies of natural persons 
requested for by other countries. In view of the in adequate response received hitherto, India’s binding 
commitments would need to be calibrated against the final responses received from its major trading 
partners in Services.  1. (a) Could India explain how the authorities coordinate amongst themsel ves to respond to WTO 
SPS enquiries?    (b) Could India explain how authorities (e.g. WTO Enquiry Points) monitor the creation or 
modification of SPS measures in their country in order to determine whether a WTO notification is 
required under the transparency obliga tions of the SPS Agreement?   
 
(c) Following this, when a determination is made, what is the mechanism (e.g. interdepartmental/inter-ministerial collaboratio n, etc.) for preparation of notifications? 
 
Reply: India has three SPS enquiry points. The Depa rtment of Agriculture and Cooperation is 
responsible for plant health, the Department of Anim al Husbandry, Dairying and Fisheries for animal 
health and the Ministry of Health and Family We lfare for human health. These Ministry/Departments 
are responsible for determining the required SPS measures. The Department of Commerce is the 
National Notifying Authority of the SPS measures.    The determination of SPS measures is based on a ri sk analysis process so as to protect animal 
and human health of the country. The import risk an alysis is conducted in c onsultation with technical 
experts on the basis of well recognized scientific pr inciples and with reference to the specific product 
and the disease situation prevailing in the exporting country vis-à-vis the disease situation in India. 
The same principle has be en used in the formulation of sanitary conditions for the import of cattle, 
sheep, goats, rabbits and meat products into the country. The SPS measures in force are on the basis 
of scientific principles of risk analysis and on the lines of well recognized international standards 
including those of Codex, OIE and IPPC.   
Canada acknowledges India's effort to adjust its overall SPS regime to international standards.  
However, we note that the response time is unusually long for requests for certificates for new  WT/TPR/M/182/Add.1 
 Page 271 
 
 
  products, and that it is difficult to  obtain a timely response from Indian officials.  For example, a 
Canadian exporter of bovine semen applied last year for a permit to import into India and has still 
not received the import permit. Since to our know ledge no SPS issues have arisen, the permit should 
have been issued within 5 days.  
2. Could India explain why most requests for consideration of certificates for new products face 
such long delays? 
Reply: The sanitary conditions are formulated in consu ltation with technical experts on the basis of 
well recognized scientific principles. The importers have to provide necessary documents to verify 
adherence to the sanitary and phytosanitary stipul ations of India. If necessary documents are not 
furnished, delays ensue. 
 
REPLIES TO SUPPLEMENTAL QUESTIONS FROM CANADA ON AGRICULTURAL 
BIOTECHNOLOGY  
 
Report by the Secretariat (WT/TPR/S/182) 
 Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xiii) 
Labelling, paragraph 65, page 56: 
 
Paragraph 65 of the Secretariat’s report (WT/TPR/ S/182) refers to a draft regulation (GSR 152(E)) 
which would put in place a comprehensive labelling requirement for genetically modified food. When 
India first notified this proposed regulation to  the WTO in 2006 as notification G/TBT/N/IND/12, 
Canada posed questions which Canada woul d like ask again at this juncture.  
 
Canada notes that while the draft notification pr ovides a definition of “genetically engineered and 
genetically modified foods,” the text of the notifica tion makes use of the term  “genetically modified” 
and does not make use of the term “genetically  engineered”. The terms genetically modified and 
genetically engineered organisms are not synonymous.   4) (a) Could India please explain how it defines “genetically modified” and how does India 
define “genetically engineered”?  
Reply: India would like to adopt the definition as re commended by Codex although , the definition of 
genetically modified organism is at st ep 7 of Codex for adoption at step 8.  
 (b) Could India please provide more information regarding the timetable for implementation of 
regulation GSR 152(E)? 
 
Reply: The implementation of this notification has been deferred for the time being due to 
administrative reasons including implementation of the Food Safety and Standard Act, 2006.  
 In addition, Canada would like to know more about  the changes notified to the WTO via notification 
G/TBT/N/IND/17 and regarding the regulation of imports of Genetically  Modified Food, Feed, 
Genetically Modified Organisms (GMOs) and Living Modified Organisms (LMOs). 
 5) Could India please provide more detailed information on the changes notified to the WTO 
and the regulation of imports of Genetically Mod ified Food, Feed, Genetically Modified Organisms 
(GMOs) and Living Modified Organisms (LMOs)? 
 
Reply: As against prohibition on manufacture or sale of genetically modified food, the notification 
proposes to introduce a labeling provision on genetically modified food for  import as well as for WT/TPR/M/182/Add.1 
Page 272  
 
  production and sale within India. The same when im plemented will be notified to WTO. There is no 
separate notification on genetically modified feed, GMO or LMO.  
 
In reference to Condition No. 18(d) in Par agraph 4 of Notification No. 2(RE-2006)/2004-2009, 
Canada notes that India may encounter difficulties in  the implementation of this requirement for 
processed products, such as oils. Refined oils contain residual DNA and denatured protein resulting 
in difficulty in detecting these analytes. Protein-  or DNA-based detection methods may also be 
difficult to implement successfully fo r other highly processed food products.  
 6) Could India please explain how it India proposes to implement this requirement? 
 
Reply:  Regarding exemption of highly refined end produc t such as highly refined oils in which the 
presence of GM material is unlikely, it is felt that such exemption is likely to be a difficult proposition 
solely on the basis of the fact that the product is a highly refined one.  
 
 Firstly, if such an end product is a highly refi ned one, the level of GM content is expected to 
be, in any case, below the limit permitted for inadvert ent contamination. In other words, a so called 
‘highly refined product’ with GM material above th e permissible limit for inadvertent contamination, 
need not be exempted from labeling, simply  because it is a highly refined product.   
  Secondly, according to the definition of the terms accepted by Codex (at step 7 of the 
procedure) “Food and food ingredients obtained th rough certain techniques of genetic modification / 
genetic engineering” means food and food ingred ients composed of or containing genetically 
modified / engineered organisms obtai ned through modern biotechnology, or food and food 
ingredients produced from,  but not containing genetically modified / engineered organisms 
obtained through modern biotechnology . As a corollary, therefore it ma y be appropriate  to consider 
labeling requirement of those highly refined prod ucts which, although unlikely to contain GM 
material, are produced from GM material.   
REPLIES TO FOLLOW-UP QUESTIONS FROM CANADA
 
 
Response to Canada Question 1:  Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 56, page 54: 
 
Mention is made in paragraph of 56 of the va rious Indian WTO/SPS Enquiry Points; however, no 
information is provided regarding th e coordination among these authorities. 
 
Original Question: Could India explain how the authorities coordinate amongst themselves to 
respond to WTO SPS enquiries? 
 India’s Reply:  India has three SPS enquiry points. The Depa rtment of Agriculture and Cooperation is 
responsible for plant health, the Department of Anim al Husbandry, Dairying and Fisheries for animal 
health and the Ministry of Health and Family We lfare for human health. These Ministry/Departments 
are responsible for determining the required SPS measures. The Department of Commerce is the 
National Notifying Authority of the SPS measures.  
 
 The determination of SPS measures is based on a ri sk analysis process so as to protect animal 
and human health of the country. The import risk an alysis is conducted in c onsultation with technical 
experts on the basis of well recognized scientific pr inciples and with reference to the specific product 
and the disease situation prevailing in the exporting country vis-à-vis the disease situation in India. 
The same principle has be en used in the formulation of sanitary conditions for the import of cattle,  WT/TPR/M/182/Add.1 
 Page 273 
 
 
  sheep, goats, rabbits and meat products into the country. The SPS measures in force are on the basis 
of scientific principles of risk analysis and on the lines of well recognized international standards 
including those of Codex, OIE and IPPC.   
Supplemental Question:
 Could India please elaborate further on how the various WTO/SPS enquiry 
points (i.e.: Department of Agriculture and Cooperation) coordinate these activities amongst 
themselves?  
 
Reply: The SPS notifications received at the SPS enquiry point from the WTO is disseminated to 
other enquiry points as well as to the stake holders in the country, regardless of the Ministry under 
whose jurisdiction they fall. 
 
Different enquiry points take care of WTO/SPS issues in different areas namely Human 
Health, Animal Health and Plant Health. However,  the nodal agency for notifying any of the issues 
related to the above areas is the Department of  Commerce in the Government of India. This 
Department is also responsible for coordination on WTO/SPS issues with various Enquiry Points. 
 
Response to Canada Question 2: 
 Part IV - Trade Policies by Sector, (5) Services,  (vi) Professional Services, (b) Legal services, 
paragraph 172, page 147: 
 
Paragraph 172 states that "Legal services can be pr ovided only by natural persons who are citizens of 
India, and who are on the advocates roll in the state where the service is being provided."   
Original Question: Could India please explain if this  restriction is limited to the practice of domestic 
(Indian) law, or does the nationality/citizenship  requirement also apply to a foreign lawyer who 
wishes to provide foreign legal consultancy servi ces (advisory services on foreign and international 
law in India), provided they are qualified and licen sed to practice these types of law in their home 
jurisdiction?   
   
India’s Reply:   India does not have information relati ng to any foreign lawyers or law firms 
providing advisory services on foreign and internationa l law in India on a cross border basis. Since the 
Bar Council of India has not so far recognised any foreign qualification for the purpose of enrolment of foreign nationals as advocates in India, any fo rm of professional legal advice or consultancy 
services provided in India by foreign lawyers, located ph ysically in India, is not permitted even if it is 
on foreign and international law.  
  
Supplemental Question: 
 In Canada's experience, the establishment of foreign legal consultancy 
regimes has been a positive experience as this  enables Canadian companies and consumers to seek 
advice domestically from foreign legal consultants ( FLCs) with respect to other countries' legal and 
regulatory regimes where the FLC is li censed to practice as a lawyer.   
 
Is the Bar Council of India considering any domes tic reform to allow foreign lawyers to provide 
consultancy services on the law in which they are qua lified to practice, with the view to allowing 
Indian companies similar access? 
 
Reply: No such proposal is under consideration. 
 WT/TPR/M/182/Add.1 
Page 274  
 
  Response to Canada Question 3 (b): 
 Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, (iii) Tariffs, (a) Overview, paragraph 21, page 38: 
 The Secretariat Report notes that in the WTO Committee on SPS Measures, “[s]ome Members also 
expressed concerns about the lateness of India's no tifications on new fumigation requirements in place 
since January 2004, as this did not allow sufficient time for comment; there was also concern that the 
measures deviated from international standards.  Non-notification of various SPS measures was also 
raised by several Members.” 
 
Original Question: Can India explain why several of its SPS notifications issued during the review 
period were issued several months a fter the measures were in force?   
 
India’s Reply:  Beyond the one instance detailed out in (a) [answer provided in 3 (a) of India’s 
original responses to Canada] above, we are not aware of other ‘several’ delayed notifications. 
 Out of the total number of India’s notifications issu ed during the review period, it appears that 13% of 
notifications were issued once in force, includi ng G/SPS/N/IND/9 (adopted July 2001, notified April 
2002, and G/SPS/N/IND/33 (in force when notified January 2006).    Supplemental Question:
 Could India provide further informa tion for the reasons why several of its 
SPS notifications issued during the review period were  issued several months after the measures were 
in force?   
 
Reply: During the Review period i.e., from 2003 to 2007( till date), India notified 39 SPS notifications 
(without addenda). Out of these 39 notifications, 16 (41%  to the total notifications) were notified after 
their commencement; of these 16 notifications, 6 (15% ) were emergency notifications, 2 (5%) did not 
have any trade effect, and 8 ( 20.5%) notifications were based  on international standards.  
  An emergency notification is sometimes made, after the same has been enforced, due to the 
exigency of the situation. As per the WTO rules,  a WTO Member is not required to notify an SPS 
measure if the measure is based on international st andards or it does not have any trade effect. But 
these are often notified for the sake of information of the other WTO Members.  
Response to Canada Question 7: 
 
Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (a) Standards, paragraph 52, page 52: 
 
The Secretariat Report notes that BIS develops sta ndards through 14 Division Councils and that draft 
standards are published for comments on the BIS website for not less than one month.  Original Question: Could India please identify the policies BIS has in place to ensure that a 60 day 
comment period is provided for a ll draft standards as stipulated by  the Code of Good Practice (Annex 
3 of the TBT Agreement)?  
India’s Reply:  A mechanism has been instituted so as to provide comments on the draft notifications 
within 60 days. BIS is the coordinating agency for that.   
 
Supplemental Question:
 Could India please expand upon its reply regarding what policies BIS has in 
place to ensure that a 60 day comment periods is prov ided for all draft standards as stipulated by the 
Code of Good Practice (Annex 3 of the TBT Agreement) . What is the nature of the mechanism in place  WT/TPR/M/182/Add.1 
 Page 275 
 
 
  and how does it function? Where are the draft standards published and how can interested parties 
from other Members ensure that they are aware of their publication? 
 
Reply:   Before finalization, the draft standards ar e hosted on the BIS website (www.bis.org.in) under 
the heading “Drafts under wide circulation” which can be seen/downloaded and comments sent to BIS 
for consideration by the concerned Sectional Committee. 
  BIS has already informed that normally draft documents are circulated for a period of 2 to 3 months.  However, in case of priority, draft standa rds are circulated for a period of not less than one 
month.   
 
Code of Good Practice in its clause L. states:    Before adopting a standard, the standardizing b ody shall allow a period of at least 60 days for 
the submission of comments on the draft standard by  interested parties within the territory of a 
Member of the WTO.  This period may, however, be shortened in cases where urgent problems of 
safety, health or environment arise or threaten to arise.    It is clear from the above that period of circ ulation generally meets the requirement of the 
Code of Good Practice.  Response to Canada Question 10 (a):  Part III - Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xi) 
Standards and other technical requirements, (b) Pr oduct Certification, paragraph 54, page 52: 
 
According to the Secretariat Report, BIS operates as both a standards development organization and a 
certification program under which it manages the application of the Bureau of Indian Standard Mark (ISI). The ISI mark is granted to products both on a voluntary and mandatory basis. There are 66 products which must receive ISI certification due to health and safety concerns (i.e. where its 
application is mandatory). Manufacturers, including foreign manufacturers, are able to apply the ISI 
mark if they have been certified by BIS. And,  BIS has been designated as a National Certification 
Body for recognizing and issuing certificates under the IECEE CB Scheme. 
 
Original Question: Could India explain how BI S’ standards development body and its conformity 
assessment body operate as distinct, separate and in dependent entities in keeping with international 
best practices for good governance?  
 
India’s Reply:  The standards development wing and its  conformity assessment body of BIS are 
distinct, separate and independent entities.   
  
Supplemental Questions:
 Could India please provide further details on how the separation of BIS' 
standards development and conformity  assessment bodies is achieved?  
 
Are they completely separate entities?  
 If so, are they separate legal entities with comp letely different management structures and executives? 
 Reply: The BIS Act, 1986 was enacted by the Government  of India for the establishment of BIS for 
harmonious development of the ac tivities of standardization, mark ing and quality certification of 
goods.  The Conformity Assessment and Standard s’ Formulation activities have been addressed 
distinctly in the BIS Act, 1986; BIS Rules, 1987 & BIS (Certification) Regulations, 1988. The 
establishment, publication and promotion of Indian  Standards has been addressed under Item 7 and WT/TPR/M/182/Add.1 
Page 276  
 
  Conformity Assessment has been addressed under Item  12 of Chapter 3 of BIS Rules, 1987 as entirely 
different activities. The detailed certification guidelines have been stated in BIS (Certification) Regulations, 1988.   The Conformity Assessment activity of BIS is operated through its various regional and 
branch offices across the country and its headquarter s in New Delhi.  The branch offices are reporting 
to the respective regional offices and the regional heads are reporting in turn to the Additional 
Director General (Marks).  There is a Secretaria t in the headquarters to assist the ADG (Marks), 
which is headed by the Deputy  Director General (Marks). 
 
 The BIS Standards’ Development activity is an  entirely separate activity centered at the BIS 
Headquarters in New Delhi. It consists of 14 T echnical Departments where the related subjects are 
discussed amongst relevant Technical Committee memb ers/experts and the draft Standards are sent 
for wide circulation. The final recommendations/India n Standard is further approved by the Sectional 
Committee and Division Council set up by the Bur eau in the defined areas of industries and 
technologies for formulation of Standards. The Tec hnical Departments report to the Deputy Director 
General (Technical) who in turn reports to th e Additional Director General (Technical).   
  The officers and staff involved in certificati on and standards formulation respectively are 
entirely separate and report to thei r respective departmental heads. 
 
 From the above it is clear that Standards’  Development and Conformity Assessment are 
entirely separate activities being carried out by BIS. The Certification wing of BIS only makes use of 
the formulated Standards for licensing purposes and gi ves its feedback to the Standard Formulation 
Departments for effecting improvements based on the experience and feedback from industry and 
other stakeholders. Also, there are two separate Advisory Committees viz. Certification Advisory 
Committee and Standards Formulation Advisory Comm ittee which have been formulated by the Govt. 
for efficient discharge of two functions of BI S i.e. Conformity Assessment and Standards’ 
Formulation respectively.   
Response to Canada Question 10 (b): 
 
Original Question: Coul d India indicate if BIS has been accredited to ISO/IEC Guide 65, the 
international conformity assessment standard fo r bodies operating product certification programs?  
 
India’s Reply:  The product certification scheme being opera ted by BIS is as per ISO/ IEC Guide 65. 
The scheme has not been accredited to ISO/ IEC Guid e 65. However, steps are being initiated to get 
the scheme accredited to ISO/ IEC Guide 65. 
  
Supplemental Question:
 Canada welcomes the news that BIS is taking steps to be accredited to 
ISO/IEC Guide 65.  Could India provide further de tails on the steps it is initiating and their timelines 
for completion? 
 Reply:  The matter has been re-examine d and the reply is as follows: 
  The bureau’s predecessor, the Indian Standa rds Institution (ISI) was set up in 1947 as a 
registered society, under a Government of India resolution and the Indian Standards Institution had 
been operating the Product Certification Scheme si nce 1955. In 1986 the Government recognized the 
need for strengthening the Indian Standards Institutio n   and accorded it a statutory status renaming it 
the Bureau of Indian Standards under the “The Bure au of Indian Standards Act, 1986”, an Act passed 
by the Parliament. This Act   provide a mandate for the harmonious  development of the activities of 
standardisation, marking and quality certification of goods and for matters connected therewith or 
incidental thereto.   WT/TPR/M/182/Add.1 
 Page 277 
 
 
   The product certification scheme is being operated by the BIS since 1955 as per ISO/ IEC 
Guide 65. Since the Bureau of Indian Standards has been empowered through a special Act of the 
Indian Parliament to operate the Product Certifi cation Scheme, no further accreditation is required. 
 
Response to Canada Question 11: 
 
Part III - Trade Policies and Practices by Measure, (2) Measures Directly Affecting Imports, (x) 
Contingency Measures, (a) Anti-dumping and countervailing measures, Measures, paragraphs 
41-49, page 49: 
  With respect to the use of anti-dumping and counte rvailing duty measures, Canada observed that the 
number of trade remedy cases being initiated by India continues to be very high and injury findings 
are very high in relation to the number of cases in itiated. Canada also suggested that in certain 
sectors India suffers from inefficiencies due to infr astructure bottlenecks, high input and freight costs 
and the high cost of capital.  
 
Original Questions:  
 
(a) Could India explain to what extent th ese factors, or economic factors other than 
imports, are taken into consideration dur ing the injury phase of trade remedy 
investigations? 
  
(b) In addition, do Indian authorities see a co rrelation between efforts to address these 
problems and the number of trade remedy investigations being initiated?  
 (c) Could India comment on the relationship between tariff levels and the number of 
trade remedy complaints and investigations?  
 (d) Finally, do Indian authorities see a decline in the number of investigations in the 
short and medium terms?   
 
India’s Reply:  In all anti-dumping investigations, any factor, including economic factors which may 
be contributing to injury of the domestic industr y are examined.  The measures are imposed only after 
the Authority is satisfied that there is a causal li nk between dumped imports and injury caused to the 
domestic industry.   There does not appear to be any co-relation between factors causing injury to the domestic 
industry and number of trade remedy investigation being initiated. 
  In India, tariff levels are falling consistently  and there is no co-relation between trade remedy 
investigations initiated in India with the changing tariff levels. 
 
Supplemental Question:
 Canada is still interested in knowin g the reason or reasons for the high 
number of trade remedy investigations being initiated by India and the high percentage of affirmative 
injury findings in such investigations. Could India please elaborate further?    
 
Reply:  Anti-dumping investigations are initiated after examining the accuracy and adequacy of the 
evidence provided in the petition and after satisfyi ng that there is sufficient evidence regarding 
dumping, injury and a causal link between dumped impor ts and alleged injury to justify the initiation. 
The extent of percentage of affirmative findi ngs depends upon the obser vations and conclusions 
arising out of the investigation. 
 WT/TPR/M/182/Add.1 
Page 278  
 
  Response to Canada Question 16(b): 
 Part III– Trade Policies and Practices by Meas ure, (2) Measures Affecting Imports, (xii) 
Sanitary and phytosanitary meas ures, paragraph 57, page 54: 
 
The Secretariat’s Report states that, “in an attemp t to streamline SPS procedures and enforcement, the 
Food Safety and Standards Act was passed by Parlia ment in August 2006, although it is yet to be 
enforced”.  
 
Original Question: (b) Will India be implem enting regulations to enforce the legislation? 
 
India’s Reply :  The various provisions of the Food Safety  and Standard Act, 2006 will be brought 
into effect through the notifications.  Supplemental Question
: Could India clarify whether the notifications referred to are notifications to 
the WTO SPS Committee? 
 
Reply: The Food Safety and Standards Act, 2006 has al ready been notified on 27 June 2005 to the 
WTO, vide WTO SPS notification no. G/SPS/N/IND/ 21. Any subsequent regulation on food safety 
and standards would be notified to the WTO  in  accordance with the requirements of the existing 
WTO discipline.  
  
NORWAY
 
 
Question 1:  Paragraph 133 (p.28) of the Go vernment Report (WT/TPR/G/182) i ndicates that a comprehensive 
amendment to the Insurance Act is envisaged. No rway would appreciate if India could provide more 
details on the elements likely to be included in su ch an amendment. In particular, Norway would be 
interested to know whether India plans to a llow cross-border supply of insurance for large 
commercial risk for relatively sophisticated cons umers, for instance within marine, aviation and 
transport insurance.    
 Reply :  As per the existing statutory regime, properties registered in India cannot be insured with a 
foreign insurer without the prior approval of the Govt . of India.  However, foreign participation in the 
equity of an Indian Insurance Company, upto 26%,  is allowed. The details of amendments proposed 
in the Bill cannot be provided as it is un der consideration of the government.  
 
Question 2: 
 
In para 142, it is said that carriage of Govern ment cargo remains reserved first for the Shipping 
Corporation of India (SCI), then for vessels charte red by the SCI’.  We would like to received an 
explanation on the coverage of the definition of Government cargo es, and if it has a broader coverage 
than would be provided for by GATS Article XIII on Government procurement.  Could you also 
provide information on the cargo volumes carried by  SCI under these Rules in volume terms, and as a 
percentage of total sea borne import/export to India? 
Reply: As per India’s schedule of specific commitments in its Draft Offer on Maritime Transport 
Services under GATS the limitations on Market Access cl early specify India’s position in this regard. 
As per the existing government policy, in respect of government owned/controlled cargoes, all import 
contracts are to be finalized on FOB/FAS basis. Deviation from this requires prior permission from 
Transchart on a case to case basis. The present policy of import of cargoes is mainly to provide cargo  WT/TPR/M/182/Add.1 
 Page 279 
 
 
  support to Indian flag vessels by providing them the first right of refusal without giving any price 
preference. The policy is  considered essential in or der to ensure the arrival of strategically required 
cargoes/materials on time and in case of emergency situations. However, no preference/restriction is imposed on export of cargoes including government cargoes. At present, India does not intend to review the policy. Government cargoes are the cargoes owned or controlled by the Government 
(including the state governments) or its organizations. No separate database is  maintained in respect 
of cargo volumes carried by SCI under the above ru les (i.e Carriage of Government Cargo). 
 
Question 3  
We would also appreciate information on any other flag preferences for India flagged vessels 
including information and explanation on the policy applicable in relation to FOB/FAS import and export and how this effect the ability for Indian im porters/exporters to chose transport alternatives? 
Reply:  Other than Government cargoes for which commi tments have been scheduled in the revised 
offer in the WTO, no flag preferences are prescribed in Government policy.  Indian 
importers/exporters are free to choose their trans port alternatives.  The policy with regard to 
government cargoes is indicated in India’s offer in the WTO.   
CHILE
 
 
TRADE POLICY REGIME, Annex II.1: Trade-related technical assistance. Paragraph 2, 
Page 32.    
5. Chile would appreciate further information on India's idea of building a worldwide database 
on SPS and TBT requirements. 
 Reply:  The composite data base providing tariff line wise country wise information in an easily 
accessible manner, would go a long way towards addr essing the information gap faced by exporters, 
especially of developing countries and LDcs. 
 
TRADE POLICIES AND PRACTICES BY MEASURE, (2) Measures directly affecting imports, (xi) Standards and other technica l requirements.  Paragraphs 48-53, Page 50-52.    
6. To what extent are international standards used to develop Indian technical regulations?  
Chile would also like to know whether Indian regul atory agencies accept, in the regulated field, the 
results of conformity assessment conducted by  third-country bodies which are accredited by 
organizations party to mutual recognition agreements.  
Reply:  International standards are given due consider ation in the process of formulation of Indian 
standards.      India accepts Certification Body (CB) test certificates issued by the National Certification Bodies of other countries under the CB scheme for el ectrical products covered in the scope of BIS 
approval for the purpose of grant of BIS Certifi cation. The website of IECEE  provides more 
information on the scope of BIS approval. 
 
2. Developments in foreign Investment. Would In dia be in a position to raise the current 74% 
ceiling on FDI in the telecommunications sector? 
 Reply:  The FDI policy is reviewed by the Government  on a regular basis. The FDI ceiling in the  
telecommunications sector was raised from 49% to 74% in 2005. WT/TPR/M/182/Add.1 
Page 280  
 
  4. What are the reasons for the prohibition on foreign equity participating in retail trading? Is 
India considering the possibility of lifting this prohibition? 
 
Reply:  The FDI policy is reviewed by the Government on a regular basis. 
 8. Given that only 26% of oil refining activities is in the hands of the private sector, would India 
be in a position to review this 26% limit on foreign  investment in public sector refining activities? 
 
Reply: The FDI policy is set and reviewed by the Gove rnment on a regular basis. The present policy 
allows FDI up to 26% in public sector refineries, while FDI up to 100% is allowed in private sector 
refineries. 
 
ECONOMIC ENVIRONMENT, (2) Recent economic de velopments, (iii) Structural reform, (c) 
Industrial policy. Reduction in the number of pr oducts reserved for th e small-scale sector.  
Paragraph 26, Page 12.   
 
1. Would India please provide information on the rationale behind the decision to reduce the 
number of products reserved for manufac ture by the small-scale sector? 
 
Reply:  A review of the list of items reserved for the small-scale industries sector takes place on a 
continuous basis. During the review, modifications  in the list is made, inter alia, for creating 
opportunities for higher investment, facilitating technological upgradation, improving quality, 
promoting exports and achieving economies of scale in manufacturing the said items.   
TRADE POLICY REGIME, (2) Trade policy object ives.  Mechanisms which have generated 
"duty forgone" from export promotion schemes.  Paragraph 15, Page 23.   
 
3. The report states that duty forgone fr om export promotion schemes in 2004-2005 was 
estimated at over Rs 354 billion (approximately US$7, 878).  Would India please indicate the main 
export promotion schemes during that period and briefly explain what they entailed. 
 
Reply: The major export promotion schemes are outlined in the policy document ‘ Foreign Trade 
Policy 2004-09’ which is available on the DGFT website www.dgft.gov.in.  
 
TRADE POLICIES AND PRACTICES BY MEASURE, (2) Measures directly affecting 
imports, (xiii) Labelling. Paragraphs 64-65, Page 56.    
7. Chile would like to know whether the specifie d draft regulation on the labelling of genetically 
modified food is already in force and abou t India's experience of this process. 
 
Reply:  India is working on a draft regulation on the labelling of Genetically Modified Organisms 
(GMO).  
 
TRADE POLICIES BY SECTOR, (3) Energy, (i ) Oil and gas. Paragraph 40, Page 114.  
 8. Given that only 26 per cent of oil refining activities is in the hands of the private sector, 
would India be in a position to review this 26 p er cent limit on foreign investment in public sector 
refining activities? 
 
Reply: As on 1.4.2007, the installed capacity in the refinery sector is 148.97 Million metric tonnes 
(MMT), out of which 43.50 MMT (29. 2%) is accounted  for by the pr ivate sector. There is no cap on 
Foreign Direct Investment (FDI) in refining activit y in the private sector, and FDI up to 100% through 
the automatic route is already available for refi ning activities in the private sector. The 26% FDI  WT/TPR/M/182/Add.1 
 Page 281 
 
 
  restriction referred is only applicable for refining in the public sector, and there is no policy bar for 
any foreign entity to come either on its own, or  through a joint venture in the refining sector. The 
overall FDI Policy, including for the oil and gas sect or, is reviewed on a continuous basis for further 
liberalization.  
 
TRADE POLICIES BY SECTOR, (5) Services, (v) Transport, (b) Maritime transport. 
Paragraph 142, Page 140.   
 9. Taking into consideration the Draft Policy fo r the Maritime Sector issued in 2005, would 
India consider removing the restriction related to the carriage of government cargo being reserved first for the Shipping Corporation of India?   
 
Reply:  As per India’s schedule of specific commitments in its Draft Offer on Maritime Transport 
Services under GATS, the limitations on Market Ac cess clearly specify India’s position. As per the 
existing government policy, in respect of governme nt owned/controlled cargoes, all import contracts 
are to be finalized on FOB/FAS basis. Deviation from this requires prior permission from Transchart 
on a case to case basis. The present policy of import of cargoes is mainly to provide cargo support to 
Indian flag vessels by providing them the first right  of refusal without giving any price preference. 
The policy is considered essential in order to ensure the arrival of strategically required 
cargoes/materials on time and to deal with emergenc y situations. However, no preference/restriction 
is imposed on the export of cargoes, including government cargoes.  
 
Would India please also provide further informa tion on the specific activities which will benefit from 
the new shipping policy. 
  
Reply: There has been a sustained rise in the volume of  exports with the revival of growth in the 
manufacturing sector and improved export competitiven ess. The Maritime Sector, including Ports and 
Shipping, provides the platform for transportation of 95% by volume and 70% by value, of India’s 
global merchandise trade. Recognizing the crucial role which the sector will have to play in achieving 
India’s trade objectives, the National Maritime Deve lopment Programme has been formulated.  This 
can be accessed on the website <http://shipping.nic.in> . Under the Programme, specific projects to be 
taken up for implementation over a de fined period have been identified.  
 
 Implementation of the projects under the NM DP is expected to result in increased 
productivity and improvement in the quality of service in the maritime transport services sector and  enhanced competitiveness.    ARGENTINA
 
 
Could India explain the second route for FDI re ferred to in this paragraph? Could it provide 
statistics on the number of cases to which each of the routes was applied during the period under 
review? 
 
Reply: In most sectors FDI is permitted through the au tomatic route. FDI in such sectors/ activities 
does not require prior approval of the Government. In these cases, the Reserve Bank of India issues a 
notification within thirty days of receipt of inward  remittance. The documents relating to the issue of 
shares to foreign investors are to be filed within thirty days.    
 For sectors not covered by the automatic route, the approval is to be granted by the Foreign 
Investment Promotion Board (FIPB). FIPB is an inter-Ministerial body set up to consider foreign 
investment proposals.  WT/TPR/M/182/Add.1 
Page 282  
 
  Could India give the reasons why in 2005 foreign in vestment restrictions were increased in certain 
areas of the telecommunication sector? 
 
Reply: The policy decision was taken by the Government in the national interest. 
 Incentives  Paragraph 44, page 31  Could India confirm whether all states in the c ountry provide incentives for the investments referred 
to in this paragraph?  What other investment incen tives are offered by the va rious state governments? 
 
Reply:   The State Governments provide different in centives for investments, from time to time, 
depending on their needs and capacity. The State G overnments provide the details of these incentives 
on their websites.  
 
(v) Tariff-rate quotas 
 Paragraph 33, page 44  Could India give the reasons why the tariff-rate quo tas referred to in this paragraph have not as yet 
been notified to the WTO?  Does India plan to notify them? 
 
Reply:   India has not notified these tariff-rate quotas to the WTO but plans to do so as soon as 
possible. 
 
(b) Import restrictions and licensing 
 Paragraph 40, page 49  Could India explain what the monitoring mec hanism for imports of certain products deemed 
"sensitive" consists of and state the purpose for which it is applied?  Is there an available list of the 
300 items?  
Reply:  The import of “sensitive items” is  monitored on a monthly basis to track any undue surge in 
imports. The analysis arising out of such monitori ng is used as an input for policy formulation and 
periodical review. The list of such items is  available at the web link www.dgft.gov.in 
 (xi) Export promotion and marketing assistance  Paragraph 105, page 69  Could India specify which products are currently being promoted for export by the EPCs and the 
Commodity Boards?  What do the promotion activities of these bodies consist of? 
 
Reply:   EPCs are non-profit autonomous organizations . A list of EPCs and Commodity Boards and 
the products promoted by them is available in  Appendix 2 of the Handbook of Procedures of the 
Foreign Trade Policy  and also at the web link www. dgft.gov.in  under Downloads.  The promotion 
activities of these bodies primarily consists of: 
 
• Participating in trade fairs/exhi bitions  in India and abroad.  WT/TPR/M/182/Add.1 
 Page 283 
 
 
  • Informing members about the latest developmen ts in trade on the national and international 
scene. 
• Organizing buyer-seller meets for promotion of exports 
• Organizing workshops in different states of the country for eliciting suggestions for policy 
making by the government. 
 
(vi) Other charges affecting imports 
 
Paragraph 34, page 44  Could India explain the basis on which it applies th e additional duty called CVD?  How frequently is 
the rate established and what methodology is used to  calculate it?  In what proportion may the rate 
vary from state to state?  
 Reply:  The additional duty on imported article is equa l to the excise duty leviable on a like article 
produced or manufactured in India. The tax base of the additional duty (in lieu of excise duty) is the 
sum of the assessable value of imported goods and b asic customs duty. The rate of  additional duty 
does not vary from state to state.  vii) Duty and tax concessions  Paragraph 91, page 64  
Could India give the rate of the drawbacks for the years covered by the period under review?  What 
requirements must exporters fulfil to qualify for th is advantage?  Do they apply to a limited quantity 
of products?  Does the advantage vary according to  product?  Does their application vary from one 
state to another?  Apart from these, are there any other tax rebate or exemption schemes? 
 
Reply:  The Drawback Schedule, 2006-07 notified vide  notification No. 81/2006 –Customs (N.T.) 
(viewed at www.cbec.gov.in) provides the rates of duty drawback for various export products. The 
exporters can avail themselves of the rates, subject  to fulfillment of conditions specified in the said 
notification. The requirements to avail of the drawback rates include inter alia  that the exporters have 
not availed of rebate of duty paid on inputs. Th e drawback rates apply to any quantity of export 
products, provided the amount due is more than Rs. 50. As may be seen from the Schedule, the 
drawback rates vary from product to product, but their application do not vary from one State to another. Apart from drawback, there are other dut y exemption and remission schemes to neutralize 
the incidence of duties paid on inputs used in exported products.  
 
(a) Tax policy 
 
Paragraph 130, page 77  Could India provide more information on the Minimu m Alternate Tax, particularly the basis for its 
application, the method for calculating the tax and th e rate of the tax?  Are any measures planned to 
simplify the country' s tax structure? 
 
Reply:  The Minimum Alternate Tax (MAT) applies to companies.  Earlier, due to various 
exemptions and deductions provided in the Inco me-Tax Act, a few companies were paying no 
corporate tax even though they had substantial book profits.  While exempti ons and deductions have 
been provided in the Income-Tax Act to promote various socio-economic objectives, it was felt that 
these ‘zero tax companies’ should also pay taxes to the Government and contribute their share to the 
nation’s development.  Hence, MAT was introduced to  make all companies pay at least 10% of their WT/TPR/M/182/Add.1 
Page 284  
 
  book profits as corporate tax. The book profit is  calculated in accordance with the Schedule of MAT 
which is available at the website  www.incometaxindia.gov.in.  
 Measures to simplify country’s tax structure
 
 
 The Government plans to introduce a new Direct  Tax Code shortly which aims to simplify the 
tax structure in India.  
 
(b) Subsidies  
Paragraph 138, page 79 
 Could India explain what the "hidden" subsidi es mentioned in the Secretariat's report refer to? 
 
Reply: The hidden subsidies referred to have been worked  by the National Institute of Public Finance 
and Policy and are the difference between the reve nue and capital expenditures on a function and the 
revenue receipt for that function.  For example, th e hidden subsidy for educa tion will be the difference 
between the revenue and capital expenditures on edu cation and the revenue receipt from education. 
 
Maritime transport  
Paragraph 143, with regard to Cabotage 
 Could India state whether there is foreign direct investment for cabotage?  The third sentence of this paragraph states that  "Cabotage is reserved for Indian-flag vessels, but 
foreign-flag vessels are permitted to carry coastal ca rgo when no Indian-flag vessel is available." 
 Are there instances in which such transport has been authorized because no local vessels were 
available?  
Reply: 100% FDI is allowed on the automatic route in th e Shipping sector in India.  Under the present 
policy, cabotage is reserved for Indian flag vessels.   The relevant provisions of the Merchant Shipping 
Act, 1958,  inter-alia provide that a ship will be d eemed to be an Indian Ship if it is owned by a 
company or a body established by or under any Cent ral or State Act which has its principal place of 
business in India.  Thus, Indian vessels owned by companies, set up through FDI, are also permitted 
to carry coastal cargo.   
  Further, foreign flag vessels are also allowe d to participate in coastal shipping for short 
periods with the specific permission of the Direct orate General of Shipping, given on a case to case 
basis, when Indian flag vessels are not available.   
 
 
REPLIES TO ADDITIONAL QUESTIONS FROM ARGENTINA
 
 WT/TPR/S/182, REPORT OF THE SECRETARIAT 
 
III. TRADE POLICIES AND PRACTICES BY MEASURE  (2) Measures directly affecting imports  (xii) Sanitary and phytosanitary Measures 
  WT/TPR/M/182/Add.1 
 Page 285 
 
 
  Paragraph 58, page 54 
 Could India specify whether the pest risk analysis referred to in this paragraph is enforceable for 
every import of the product in question or whet her, on the contrary, where trade is already 
established it is not interrupted? 
 
Reply: The principle of Pest Risk Analysis (PRA) is  applied as per the International Standards of 
Phytosanitary Measures brought out by the IPPC and the subsequent National Standard. A Pest Risk 
Analysis is conducted before a commodity is a llowed entry into the country to conclude the 
phytosanitary requirements and the risk mitigating measures for its safe entry. However, a PRA may 
also be initiated for a commodity which is already in trade where a new pest is intercepted or the 
mitigation measures fail to control the quarantine pest s or change in pest profile in the country of 
export or any circumstances evidencing that ther e is a risk of exotic pests to the country.  
 
Paragraph 60, page 55 
 
Could India define the "period of quarantine" referred to in this paragraph?  For what reasons is it 
implemented?  What products does it cover?  In  what instances should fumigation be applied? 
 
Reply: The period of quarantine relates to Post Entr y Quarantine (PEQ)  period for seeds and plant 
material for propagative purposes. This is implemente d to ensure that no invasive pest is carried along 
with the propagative material and to identify pests during PEQ inspection and observation. This 
provision covers seeds and planting material im ported for propagative purposes. Fumigation is 
insisted upon wherever the plant ma terial or seed material carries or harbors pests of concern to the 
importing country.  
 IV. TRADE POLICIES BY SECTOR 
(2) Agriculture Paragraph 17, page 104 
 Could India explain the instances in which Custom s applies the reference price for the importation of 
certain products?  What are its purposes?  Is its application predictable?  How is it implemented? 
 
Reply:  The reference prices are utilized by the Indian customs only to satisfy  the truth and accuracy 
of the declared transaction value. When an officer has some reason to doubt the truth or accuracy of 
the value declared, he may ask the importer to furn ish further information. After receipt of such 
further information, if the officer is satisfied, the declared transaction value is accepted. The referral 
values are taken from a valuation data base known as the National Import Data Base (NIDB), which 
helps in quicker valuation check online on the b asis of data of contemporaneous imports of 
comparable goods.  In NIDB, the referral values ar e worked out on the basis of the weighted average 
of assessed values.  The consignments whose assessed value is less than the weighted average of the 
assessed value are shown as outliers. Hence these refe rral values are not imposed as minimum prices 
provided by Article 7(f) of the Customs Valuation agreement.  
 The above illustrated procedure is as per th e WTO Ministerial Decision 6.1 which has been 
incorporated as Rule 10A of the Customs Valua tion Rules 1988.  The assessment officers in India 
follow the WCO case study number 13.1 in the application of Decision 6.1.  
 WT/TPR/M/182/Add.1 
Page 286  
 
  Paragraph 19, page 104 
 Could India describe the mechanism for implem enting the tariff-rate quotas for dairy products 
referred to in this paragraph? 
 Reply: Imports of skimmed and whole milk powder, milk food for babies etc. covered under ITC 
(HS) 0402.10 or 0402.21 up to 10,0 00MT is allowed in a financial year at a concessional rate of 
customs duty of 15% under the Tariff Rate Quota. The eligible entities for this quota are the National Dairy Development Board (NDDB), State Trading Corporation (STC), National Cooperative Dairy 
Federation (NCDF), National Agricu ltural Cooperative Marketing Federa tion of India Ltd. (NAFED), 
Minerals and Metals Trading Corporation (MMT C), Projects & Equipment Corporation of India 
Limited (PEC) and Spices Tradi ng Corporation Limited (STCL).  
  All eligible entities desiring to avail themselve s of the quota may make an application to the 
Directorate General of Foreign Trade. Completed application forms must reach on or before the 1
st 
March of each financial year preceding the year of  quota. Imports have to be completed before 31st 
March of the financial year for which the quota has been allocated.  
Paragraph 25, page 107 
 Could India list the products that received subsid ies through price support in  the period 2002-2006?  
Could it describe how the system works?  
Reply: Price support to the farmers is provided as a minimum guarantee price for their produce in 
situations when market prices tend to fall below the minimum support price fixed by the Government, 
inter alia, based on the recommendations of the Co mmission for Agricultural Costs and Prices and to 
avoid distress sale by farmers. The information on minimum support price can be seen at the website 
www. agricoop.nic.in.  
 The Minimum Support Price (MSP) was extended ma inly to wheat and rice for the purpose of 
helping the farmers and meeting the Public Distri bution requirements. The support was also extended 
to the growers of oilseeds, pulses, maize, copra, jute, sugarcane and cotton. The operationalisation of 
the price support scheme is  covered in para  27 to 29 of the  Secretariat Report. 
Paragraph 26, page 108 
 Could India give the amount of the total subsidies (price support + subsidies to inputs) granted to producers of wheat, rice and secondary cereals in the period 2002-2006? 
 Reply: Input subsidies on account of input use are non product specific and are mostly available for 
all agricultural products. Therefore, it is not possibl e to enlist product specific subsidy for wheat, rice 
and secondary cereals.  India has notified its dom estic support for the period 1996-1997 and 1997-98 
in March, 2002. The notification will be updated as soon as possible.  
 Paragraphs 27 and 28, pages 108 and 109  Bearing in mind that India has no available amber box subsidies under the Agreement on Agriculture, 
how does it ensure that total subsidies for each  product do not exceed de minimis levels?   
 
Could India state what the intervention prices and market  prices were in India for the main crops in 
the period 2002-2006?  Could it indicate the buy ing and selling prices established by the Government 
for each cereal during the period 2002-2006?   WT/TPR/M/182/Add.1 
 Page 287 
 
 
  Reply: India’s agricultural subsidies are within the de minimis entitlement for developing countries as 
evident from the notifications already made. It is not ed that the subsidies being given by India in the 
agricultural sector are mostly directed to the low- income and/or resource poor farmers, and also to 
provide food security, particularly to the more vulnerable sections of the society, and to provide general services to the agricultural sector, consistent with the relevant provisions of the Agreement on 
Agriculture, especially Article 6.2 and Annex2.  
  Market prices are different at different lo cations basically determined by the production, 
availability, demand and seasonal factors. Wheat and ri ce are issued at uniform Central Issue Prices to 
the States and Union Territories for distribution under the Public Distribution System. The Central 
issue price for rice and wheat is Rs. 565 per qu intal and Rs. 415 per quintal respectively for 
consumers in the Below Poverty Line(BPL) category.  The Central issue prices for consumers in the 
Above Poverty Line (APL) category for rice and wh eat is Rs. 830 per quintal and Rs. 610 per quintal 
respectively.   Paragraph 29, page 209  Bearing in mind that "the farmer has the option to  sell to the government agencies, or in the open 
market", could India provide any examples of fa rmers choosing the first option, since intervention 
prices are bound to be lower than market prices, as India has no available AMS?  
Reply: In a year of abundant availability and produ ction of cereals and other produce when the 
market prices rule low, farmers choose the first optio n in larger measure whereas in scarcity years, the 
market offers them a price higher than the MSP an d thus they choose that option. However, of the 
total production  of wheat, farmers offer only abou t 13 to 24% of the total production at MSP.  
Similarly, in the case for rice, farmers offer 23 to 30% of the total production at MSP. 
 
 
HONG KONG, CHINA
 
 Anti-dumping (AD)
 
(WT/TPR/S/182, P. ix, Para. 12, P. 49, Para. 44; and P. 51, Chart III.5) 
1. We note that India initiated fewer AD investi gations during this review period but is still a 
major user of the trade remedy.  According to  the WTO statistics, 21 cases and 28 cases were 
initiated by India respectively in 2004 and 2005, and during the first six months of 2006, there were 
already 20 initiations.  We would like to know whet her the Indian authorities consider this a reversal 
of the declining trend of the use of AD actions and  whether there are any reasons or factors, such as 
changes of governmental policies or rules, that may lead to the recent upsurge. 
 
Reply:  Anti-dumping (AD) investigations are initiated on the basis of complaints filed by the 
domestic industry relating to dumping by the exporters of other countries. An investigation is initiated 
only after evaluating the complaint in terms of the objective criteria laid down in the Customs Tariff 
Act 1975 and the Rules thereunder. The number of AD investigations initiated in a particular year 
depend solely on the nature of complaints received  and whether they are able to fully satisfy the 
prescribed objective criteria.   2. We also note that the majority of AD cases of  India involved chemical products, plastics, base 
metal, etc.  We are in terested to know whether and if yes how India would take into account the 
impact of AD measures on downstream users and consumers in India before initiation of 
investigations or imposition of measures. 
 WT/TPR/M/182/Add.1 
Page 288  
 
  Reply:  Anti-dumping measures are taken against proven unfair trade practices of the exporters of 
other countries so as to ensure a level playing field for the domestic industry. Curbing unfair competition benefits the user industry as well as consumers and is essential for the healthy 
development of trade.  India’s GATS Commitments
 
(WT/TPR/S/182, P. 127, Para. 91; and WT/TPR/G/182, P. 30 - 31, Para. 151) 
3. We welcome India’s intro duction of a broad number of new commitments in its initial and 
revised services offers. At the same time, we note t hat for most of the services found in India’s offers, 
it has been inscribed in mode 3 of the market access column that Foreign Investment Promotion 
Board (FIPB) approval would be required in the case of foreign investors having prior collaboration 
in that specific service sector in India.  This ne w inscription has also been added to some of the 
existing mode 3 commitments found in India’s GATS  schedule.  We would be grateful for India’s 
advice as to: 
 
(a)  how to define whether or not a foreign invest or is having prior collaboration in a specific 
service sector; 
 
(b)  the rationale behind for imposing the requirem ent in the case of foreign investors having 
prior collaboration in a specific service sector; and 
 
(c)  whether the granting of the relevant approva l by FIPB entails any market access or national 
treatment limitations. 
 Reply: (a) As per Press note 1(2005), new proposals for foreign investment where the investor has an 
existing collaboration, joint-venture (JV), Trademar k agreement (existing as on 12 January 2005) in 
the same field (as per 4-digit NIC code 1987) re quires the approval of the Foreign Investment 
Promotion Board  (FIPB). 
 
(b) This has been stipulated  with a view to prot ect the interests of the Indian partner /JV in an 
existing JV.  (c) The requirement of prior government approval in such cases is applicable only to foreign 
investors.     Telecommunication Services
 
(WT/TPR/S/182, P. 134 - 135, Para. 118) 
2. As set out in the Secretariat Report, restrictions to foreign investment in the 
telecommunication sector have been relaxed sinc e 2000, which has resulted in higher foreign 
investment caps for the different types of servi ces. Would India consider further increasing the 
relevant foreign investment caps in its future o ffers especially to services such as voice telephone, 
pocket switched data transmission, radio paging and ce llular mobile telephone so as to align them 
with the ones actually in place?  
 
Reply:  India would take a decision on liberalising fo reign investment caps depending on the quality 
of offers on all sectors and modes (especially modes 1 and 4) by other Members.   WT/TPR/M/182/Add.1 
 Page 289 
 
 
  Insurance  
(WT/TPR/S/182, P. 131, Para. 106) 
6. We are pleased to learn from the Secret ariat Report that the Indian Government is 
considering raising the foreign investment cap for the insurance sector from currently 26% to 49%.  
Would India share with us the latest progress of th e proposed relaxation, the expected timeframe for a 
decision to be made by the Government, and the timetable for the implementation of the higher cap 
should a positive outcome transpire eventually?   
Reply:  A proposal to amend the Insurance Act, 1938 which would inter alia , include amendments 
relating to enhancement of FDI in Indian Insura nce companies from 26% to 49% is currently under 
consideration. No fixed timeframe can be predicted for the process. 
 
Maritime Transport Services
 
(WT/TPR/S/182, P. 140, Paras. 140 & 143; and WT/TPR/G/182, P. 8, Para. 22) 
8. We note from the Secretariat Report that aroun d 95% of India’s trade in good is seaborne. To 
increase the competitiveness of ma ritime transportation services, refo rm measures have been adopted 
(e.g. 100% foreign investment is allowed in the shi pping sector in India). We would like to know if 
India would consider reflecting its de facto mo re liberal regime in maritime transport services in its 
next offer. 
 
Reply:  Review/liberalization of Government policies is an ongoing process that takes into account 
various relevant aspects pertaining to the specific sector.  As far as Maritime Transport Services Sector is concerned, Government policies in this Sector are quite liberal and this is adequately 
reflected in India’s offer of commit ments.  100% FDI is allowed on the automatic route in this sector. 
Public private partnership is the preferred route fo r development of new terminals at the ports on BOT 
basis.  Further, the Dredging Policy also allows  for participation of both Indian and foreign 
companies. Indian companies are allowed the first ri ght of refusal provided their bid is within 10% of 
the lowest technically qualified offer. This has been stipulated to provide a level playing field to the 
Indian companies. 
 
We note that the supply of maritime auxiliary services through commercial presence under mode 3 
could only be through Indian registered company.  We would appreciate if India could elaborate the 
requirements to be an “Indian registered company”.  
Reply:  A company registered as a Company under the a pplicable Indian Act constitutes an Indian 
Registered Company. The conditions stipulated in the various provisions under such an Act, would 
require to be complied with by such a company. 
 
Banking
 
(WT/TPR/S/182, P. 129, Para. 98) 
4. As noted from the Secretariat Report, it seems that a Bill will be introduced to abolish the 
restriction on the 10% ceiling in respect of: (a) the paid-up capital of a private sector bank to be 
owned or controlled by a single entity; and (b) voting rights of an individual. We would be grateful 
for India’s advice on the latest progress of the Bill and the expected timeframe for the passage and 
enactment of the Bill.  
 
(WT/TPR/S/182, P. 130, Para. 99, Footnote 138; and WT/TPR/G/182, P. 25 - 27, Paras. 119 - 126) 
Reply:  The Bill will become a law afte r it has been passed  by both th e Houses of Parliament and has 
received the assent of the President.  WT/TPR/M/182/Add.1 
Page 290  
 
  5. We note from the Secretariat Report and In dia’s existing GATS schedule that both new 
entrants and existing banks are subject to a limit of twelve licences per year, whereas in India’s revised services offer the annual licence limit has been  increased to twenty. We would like to know 
whether the licence limit is actually in place under India’s de facto banking regime and if so, what the 
annual limit currently in force is.  In case a more liberal regime is indeed in place, would India 
consider binding its existing regime in its future services offers?  
Reply:  Our commitments to WTO is 12 licenses per year for both new and existing foreign banks. 
Under WTO commitment, licence for new foreign banks  may be denied when the maximum share of 
assets in India both on and off balance sheet of fore ign banks to total assets both on and off balance 
sheet of the banking system exceeds 15%.  
  We have been autonomously giving licences in  excess of our commitment. The year wise 
number of approvals given since the year 2000 is as under:  
Year
  No. of licences  
2000      --- 15 2001      --- 18 2002      --- 16 2003      --- 18 2004      --- 17 
2005      --- 13 
2006      --- 13 
  
PAKISTAN
 
 
5. What is the procedure for grant of GIs or collective trade marks? Does India take into 
consideration the international reg istration/ use of such marks? 
 
Reply: Any association of persons or producers or any organization or authority established by or 
under any law for the time being in force representi ng the interests of the producers of the concerned 
goods, who are desirous of registering a Geographical Indication (G.I.) in relation to such goods, can 
apply in writing to the Registrar of Geographical I ndications. The applicant organization is required to 
file an affidavit as to how it represents the interest of the producers.    The Geographical Indications Registry (GIR) does a preliminary scrutiny and examination of 
the application for any deficiencies, thereafter. A s how cause notice is issued if the Registrar has any 
objection to the application. The objection is then  communicated to the applicant who can appeal 
within a month.  
 
 Every application for GI registration is publishe d within three months of acceptance in the GI 
Journal. Any person can file a notice of opposition wi thin three months (extendable by another month 
on request) opposing the GI published in the Journal.  A copy of the opposition notice is sent to the 
applicant who has to file his counter statement w ithin two months. Thereafter, both the parties are 
heard. If the application for registration of the GI is accepted the Registrar issues to the applicant a 
certificate with the seal of the GI registry.  
 
 Unless the Geographical Indication is protected in the country of its origin, there is no 
obligation under TRIPS for another country to extend reciprocal protection.  
  WT/TPR/M/182/Add.1 
 Page 291 
 
 
   The procedure for registration of a collective mark is identical to that of registration of a trade 
mark. An application for the registration of a collec tive mark is to be accompanied by the regulations 
governing the use of such a collective mark.  
 
3. Average applied rate for agriculture products is  3-4 times higher than that of non-agriculture 
products. How does India foresee its tariff reforms in this sector?   
Reply: During the Uruguay Round, developing countries were given the option of binding tariffs at 
ceiling levels.  The ceiling bindings of 100% for primary products, 150% for processed and 300% for 
some edible oils were, accordingly, notified to  the WTO. All previously unbound tariffs were bound 
at the aforementioned levels.  Proportionality or parallelism of agricultural tariff commitments with 
those of other products was not established in th e Uruguay Round.  Calibration of applied tariffs – 
upwards or downwards – within bo und levels is done to meet the objectives of food security and price 
stability and to maintain publicly-held buffer stocks, without jeopardizing the interests of about 60 per 
cent of the population dependent on agriculture for liv elihood, the vast bulk of whom are low-income 
and resource-poor.  Having regard to its food secu rity, livelihood security and rural development 
needs, the G-20, of which India is a Member, has already proposed substantial overall bound tariff 
reductions across agricultural products of a maximu m of 36 per cent, provided these are two-thirds 
those that may be committed to by the develope d country Members, coupled with appropriate 
flexibilities through Special Products and the Special Safeguard Mechanism, as a part of the outcome 
of the Doha Work Programme.  
1. Beside basic customs duties, India also l evies Counter veiling duties, special counter veiling 
duties, special excise duty and education cess on imported products. Invariably such duties are levied 
on duty paid value. Hence their impact is more than  the scheduled rate. Would India like to justify 
levy of such duties with respect to its obligation regar ding 'other duty and charges" in terms of Art II 
of GATT? 
 
Reply:  The levy of Additional Duty and Special Add itional Duty on imported pr oducts is  consistent 
with the provisions of the WTO agreement. Paragraph 2 of Article II read with paragraph 2 of Article 
III of GATT 1947, which permits the  imposition on im ported products of a charge equivalent to 
internal taxes or other internal charges applied, dir ectly or indirectly, to like domestic products. As far 
as education cess of customs is concerned, it is in the nature of a tariff and is consistent with India’s 
WTO obligations as long as the tariff plus the cust oms education cess does not exceed the bound rate.  
As regards education cess of exci se, it applies to all domestic good s and therefore imported goods can 
also be subjected to the same internal taxes in term s of  Article III. There is no such duty as ‘special 
excise duty”.  2. India is one of the competitive producers of Textile and Clothing. However, India maintains a 
very high tariff on T&C including the levy of non ad valorem duty. Such a tariff regime raises questions of transparency and is likely to be used as  an instrument of protection. Could India please 
clarify and justify such trade policy measure?  
 
Reply: India’s textile and clothing tariffs are well within its WTO commitments. 
 
4. There are certain tariff rate quotas where im ports have occurred but no TRQs were issued; 
meaning thereby that out-of-quota rates were paid fo r such imports. Can India identify the reasons 
for non-issuance of these quotas? Does India also feel obliged to notify TRQ utilization to the WTO?   
 
Reply:  Authorisations for TRQs are issued by Dir ectorate General of Foreign Trade based on the 
requests or expression of interest (which is market  driven) received from desirous importers under the WT/TPR/M/182/Add.1 
Page 292  
 
  scheme.   India has not notified these tariff-rate quotas to  the WTO but plans to do so as soon as 
possible.   
THAILAND
 
 
(x) Export finance, insurance, and guarantees 
 Paras 101-102: India provides a range of financi ng products, support program mes, and export credit.  
India’s Exim Bank also provides various expor t guarantee schemes and fee-based services to support 
international trade and investment. Are agricultural products the main users of export subsidies, 
export credit, export insurance, and export guarantees?  Does the payment program of internal 
transportation and freight charges fo r exporting sugar comply with Article 9.4 of AOA since the 
implementation period has expired in 2005?    
Reply:  The Agro and Food Processing sector accounts fo r only about 5% of the exposure of the Exim 
Bank of India as on 31.3.2006.  Through the 20 04 Framework Agreement and the Hong Kong 
Ministerial Declaration of 2005 the provisions of Ar ticle 9.4 of the AoA have been agreed to be 
continued for a period of five years beyond the e limination of all forms of export subsidies.   
 
(2) A
GRICULTURE  
 
(i)  Overview 
Para 8: According to the Secretariat Report, some factors that have dissuaded private sector 
investment include low productivity due to regulat ion of agricultural markets and the movement of 
major crops.  Could India please provide more deta ils on how these factors have negatively affected 
private investment in agriculture, including how th e movement of major crops affects agricultural 
productivity?  We would also appreciate further details on India’s land ownership ceiling laws, 
succession patterns, tenancy laws and re gulation of agricultural markets. 
 
Reply:  The purpose of State regulations of agricultura l markets has been to protect farmers from 
exploitation by intermediaries and traders and also to ensure better prices and timely payment for their 
produce. Exporters, processors and retail chain operat ors have not able to procure directly from the 
farmers as the produce is required to be channelised through designated markets and licensed traders.  
In the process there may have been some increase  in the cost of marketing and/or lower price 
realization to the farmers for their produce, adve rsely affecting the productivity and efficiency. This 
may have discouraged private investment in the s ector.  However, currently many State Governments 
are in the process of implementing marketing reforms by amending their respective laws to rectify the 
situation.   The land holding pattern as per the Agricultura l Census of 2000-2001 indicates that out of a 
total of about 120.8 million holdings, almost all the holdings are small and marginal with operational 
land holdings of less than or equal to 10 hectares.  The ceiling and tenancy laws vary from State to 
State as it is a State subject.   
 
(ii) Agricultural policies 
 
(a) General framework 
(ii) Para 14: The Secretariat Report states that the Food Corporation of India (FCI) purchases 
foodgrains at procurement prices set by the Govern ment and sells them at the Central Issue Price 
(CIP) also fixed by the Government. Please prov ide more details on proc urement prices and the  WT/TPR/M/182/Add.1 
 Page 293 
 
 
  Central Issue Price. When are procurement pri ces and the Central Issue Price applied? How does the 
government release the stocks resulting from pr ocurement under minimum support price schemes? 
How does the public distribution system operate when the Government procures food grains? 
 
Reply: The commodities that are subject to minimum support prices are : (1) Paddy, (2) Jowar,  (3)  
Bajra,  (4)  Maize, (5) Ragi, (6) Arhar (Tur), (7) Moong,  (8) Urad,  (9) Cotton,  (10)  Groundnut in 
shell, (11) Sunflower seed, (12) Soyabean,  (13) Sesame, (14) Niger seed, (15) Wheat,  (16) Barley,  
(17) Gram,  (18) Masur (Lentil), (19) Rapeseed, (20) Safflower, (21) Toria, (22) Copra,  (23) Jute,  
(24) Sugarcane,  (25) Tobacco (VFC).   
 Minimum support prices for the agricultural products are determined taking into account the 
objectives of the policy.  The CACP advises on th e price policy of major agricultural commodities 
with a view to evolving a balanced and integrated  price structure from the perspective of the overall 
needs of the economy and with due regard to the interests of the producer and the consumer.  The 
Government’s price policy for agricultural commod ities seeks to ensure remunerative prices to the 
growers for their produce with a view to encour aging higher investment and production, and to 
safeguard the interests of consumers by making ava ilable supplies at reasonable prices. Accordingly, 
the Government announces each season Minimum Support Prices (MSPs) for major agricultural 
commodities taking into account the recommendations of the CACP. 
 
In formulating the recommendations in respect of the level of minimum support prices and 
other non-price measures, the CACP takes into account, apart from a comprehensive view of the 
particular commodity or group of commodities, factor s such as cost of production, changes in input 
prices, input-output price parity, trends in market  prices, demand and supply, inter-crop price parity, 
effect on industrial cost structure, effect on cost of  living, effect on general price level, international 
price situation, and parity between prices  paid and prices received by the farmers. 
 
(iii) Para 15: As the first National Agricultural Policy’s objective of raising annual growth in 
agriculture are being pursued through  program mes like Bharat Nirman, we would appreciate 
clarification of the Bharat Nirman programme.  We  are particularly interested in learning more about 
sectors or products under this programme, methods  or steps for achieving programme objectives, 
impact of the programme, and its expected duration. 
 Reply: The Bharat Nirman Programme was launched with  a view to improve physical and social 
infrastructure in rural areas.  It covers six core  areas of infrastructure development, namely,  
irrigation, rural connectivity, rural housing, dri nking water supply, rural electrification and rural 
telephone connectivity.  The key objective of the pr ogramme is to improve the basic infrastructure 
and amenities in rural areas by 2009. 
 
(d) Internal policies 
 
(iv) Overview 
 
Para 25: The Secretariat Report states that India’ s internal measures to support agriculture include 
direct subsidies for inputs and indirect assistance th rough price support. Could India please identify 
the most highly subsidized products under its price support programme during 2001-2006?  
 
Reply: The details would be notified in accordance with  the relevant notification.  It may be 
mentioned that India’s product-specific support is negative and well within its de minimis.  
 WT/TPR/M/182/Add.1 
Page 294  
 
  (v) Tariff-rate quotas 
Para 33: The Secretariat Report indicates that “W hile TRQs were not issued for some of these 
products for certain years, imports have occurred  over recent years, presumably at out-of-quota 
rates.”  Please specify those products for which th is has occurred.  Under its FTAs, has India granted 
quota-free status for any agricultural products curren tly subject to WTO TRQs?  If so, could India 
please identify the product and relevant FTA?    
Reply:   India has not granted quota-free status for any agricultural product currently subject to  TRQs, 
under its FTAs.  
(xv) State Trading 
Para 79 and Table III.6: Indian state trading enterprises such as Food Corporation of India have 
played a key role in the importation of wheat, rice, maize, grain and other products in order to 
maintain India’s food security and to enable be tter marketing and pricing.  Could India please 
elaborate more on the procedure of state trading c ontrol over imported agricultural goods? Are STEs 
open for private bidding or do they allocate goods by themselves? 
Reply:  The procedure  of state trading control is de tailed in paragraph 2.11 of the Foreign Trade 
Policy 2004-09 and is also available at the web link www.dgft.gov.in.  The allocation of imported 
goods by one or more designated STEs, which does not preclude open bidding or allocation based on 
first-come-first-served basis, depends on the objectives of grant of exclusive or special privileges or rights.  Moreover, the Director General of Foreign Trade may also grant an authorization to any other person to import products designated for import by an  STE.  For instance, with respect to the recent 
grant of special privileges or rights to the FCI on im ports of wheat, the imports were effected with a 
view to maintaining the publicly-held buffer stoc ks.  Private entities were also subsequently 
authorized to import wheat to stabilize domestic wheat prices.      
 
(7) 
FOREIGN INVESTMENT REGIME  
 
(ii) Incentives 
2. Para 44:  The Secretariat Report states that  the Central Government's incentives include a 
100% tax exemption on profits for infrastructu re development and operation. Does this exemption 
also include profits for infrastructure maintenance?   
Reply:  The exemption is not available if the enterprise is only carrying out maintenance of 
infrastructure facility. It is available if the enterprise is carrying on the business of: 
 (i) Developing or; 
(ii) Developing and maintaining or; 
(iii) Developing, operating and maintaining any infrastructure facility. 
 
An infrastructure facility for this purpose means  (a) a road including toll road, a bridge or a rail system; 
(b) a highway project including housing or other activ ities being an integral part of the highway 
project; 
(c) a water supply project, water treatment system , irrigation project, sanitation and sewerage 
system or solid waste management system; 
(d) a port, airport, inland waterway, inland port or navigational channel in the sea. 
  WT/TPR/M/182/Add.1 
 Page 295 
 
 
  IV. TRADE POLICIES AND PRACTICES BY MEASURE 
(1) OVERVIEW  
 Para 2: The Secretariat Report states that Indian authorities have raised tariffs substantially on 27 
agricultural products during the period under revi ew. Could India please identify those products, 
their respective tariff ra tes (before and after the tariff increa se), and the reasons for the tariff 
increase? 
 
Reply:  The information is being collected  and would be supplied shortly.  
 (2) M
EASURES DIRECTLY AFFECTING IMPORTS  
 (iv) Tariff exemptions 
 
Para 31: According to the Secretariat Report, India has a wide range of tariff exemptions which are 
both product-specific and based on industrial use. Could India please identify agricultural products 
that receive tariff exemptions, if any, including the reasons for such exemptions? 
 
Reply: As and when agricultural products are extended tariff exemptions info rmation is uploaded on 
the departmental website www.cbec.gov.in. The earlier exemptions are also available on this website. 
 Para 34: According to the Secretariat Report, as of  1 March 2006, all imports are subject to a special 
duty of 4% comparable to the rates applied on dom estic products for VAT, municipal tax, market 
committee fees, etc.  Could India please explain its  calculation of this special duty and how it is 
equivalent to domestic rates? 
 Reply: Special additional duty of customs, commonly kn own as special CVD, at the rate of 4%, has 
been levied on imported goods to counter balance the internal taxes such as sales tax, value added tax, 
local tax or any other charges leviable on a like artic le on its sale, purchase or transportation in India. 
  The intention of the Government is to safegua rd the interests of th e indigenous industry, 
which suffers from various taxes levied and collected  by the States. The levy of special CVD is to 
counter the impact of such taxes.  To illustrate, taxes levied on such goods by various agencies other 
than the Central Government are:  (a) Central sales Tax (CST) on inputs procured from other States. (b) CST on products sold in other States. 
(c) Octroi levied by Municipalities on the entry of  goods. The rate of octroi varies from 2.5% to 
5.5%. This is applicable on inputs needed by the industry also. 
(d) Electricity duty levied by the State Governme nts on consumption/sale of electricity, which is 
one of the inputs for manufacture of goods. Rate of electricity duty varies from State to State. 
(e) Sales tax on petrol/diesel  
 These taxes are in addition to the general State VAT, which varies between 4% - 12.5%. 
  In India, no set-off is available for the CST on inputs, octroi on inputs, electricity duty and sales tax paid on auto fuels.  The sum of these in ternal taxes depends upon th e location of an industry 
and type of goods it manufactures. Special additi onal duty is charged only at 4%, which is the 
minimum rate. The incidence of internal taxes borne on domestic products are much higher than the 
Special CVD rate of 4%.   WT/TPR/M/182/Add.1 
Page 296  
 
  (b) Import policy 
 
Tariffs  
Para 17: The Secretariat Report states that India uses “reference prices” to calculate customs duty 
applicable on imports of, inter alia, palm oil ( crude and RBD), palmolein oil (crude and RBD), and 
crude soybean oil.  
 - When does India use “reference prices” to ca lculate customs duties and when are the reference 
prices fixed by the authorities?  
- Is there any formula used to calculate reference pr ices?  Please provide further details, if possible, 
on the background and data source used to establis h reference prices, including from exporters. 
 
Reply:  Under Section 14(2) of the Customs Act, 1962,  Tariff Values can be fixed for any class of 
imported goods or export goods  having regard to the trend of the va lue of such or like goods.  There is 
no provision for imposing minimum prices.  The tariff  value mentioned above is currently being fixed 
only in respect of the palm group of oils, crude soybean oil and brass scrap .  These values are based 
on the current international prices a nd are being frequently revised.   
 
(ix) Import prohibitions, restrictions, and licensing 
Para 40: The Secretariat Report states that im ports of certain items must be imported through 
specified ports.  Do these items include those prod ucts monitored by the committee chaired by the 
Department of Commerce Secretary? Please clarify.  
Reply: Monitoring of imports of certain sensitive items is done on a periodical basis to assess any 
undue surge in imports. However, this list of sensitiv e items may or may not include imports of items 
which are to be imported from specified ports only. 
(3) M
EASURES DIRECTLY AFFECTING EXPORTS  
 (ix) State Trading 
Para 100 and Table III.8: The Secretariat Report st ates that Indian preferential sugar quotas to the 
EC and the United States are subject to state trading.  Are other Indian sugar exports also subject to state trading? 
Reply:  Preferential sugar quotas to the EC and the US  are allotted by the Indian Sugar Manufacturers 
Association, a private sector body. 
Para 30: The Secretariat Report states that “Procu rement of rice and sugar are subject to ‘levies’, 
which are fixed shares of output that must be sold to the Central Government at fixed prices for the 
TPDS [targeted public distribution system].”  It also  states that  “Rice procured by the Government 
through a statutory levy on rice millers and rice deal ers is fixed by states in consultation with the 
Central Government and varies from State to State.”   Please provide further details on the above processes.   We would also appreciate, if possible, a 
detailed breakdown of the rice procurement process.  
 Reply:  The Government is procuring rice for the Cent ral Pool to cater to the requirements of the 
Targeted Public Distribution System (TPDS) and Other Welfare Schemes (OWS).   There is open 
ended procurement of paddy under price support oper ations.  The paddy procured is converted into  WT/TPR/M/182/Add.1 
 Page 297 
 
 
  custom milled rice (CMR).  Rice is procured under the statutory levy system from millers/dealers.  
Rice Levy Orders have been issued by various States/UTs availing of powers under the Essential Commodities Act, 1955.  The Levy Orders specify the pe rcentage of rice to be compulsorily sold by 
the millers/dealers to the Food Corporation of India/ State Government at the levy price fixed by the 
Government of India every year and conformi ng to the quality specifications laid down by 
Government of India.  The rice le vy percentage is determined by the State Governments with the prior 
concurrence of the Central Government, keepi ng in view the production, market surplus and 
requirement for TPDS/OWS.   The State Government s ensure compliance of levy orders and take 
action under the Essential Commodities Act against defaulters.   
 
THE UNITED ARAB EMIRATES
 
 
The UAE Government has sought clarification from  the Indian Delegation concerning the latter's 
Tariff Regulations impacting Port Services – Current Tariff setting principles in erosion of equity and 
unviable investment climate.  
Reply:  While drawing up plans and guidelines for private sector participation for development of Port 
infrastructure, it was felt that there was a need fo r setting up an Independent Regulatory Authority to 
fix and revise Port tariffs taking into account the cost  of new investments as also the cost of financing 
of any such investments and at the same time provide  for protection to user interests.   Accordingly, 
the Tariff Authority for Major Port s (TAMP) was constituted in April, 1997 to regulate all tariffs for 
major ports as well as BOT operators including vessel  related charges, cargo related charges and rates 
for lease of properties in respect of Major Port Trus ts.  The legal authority for TAMP is derived from 
the Indian Ports Act, 1908 and the Major Port Tr usts Act, 1963.  The basic objective for setting up 
TAMP was to provide a fair and cost based tariff st ructure ensuring a specified return on the capital at 
the Major Ports.   
  In view of the above, the present tariff regul atory mechanism based on cost plus return of 
capital ensures that projects remain viable a nd get a minimum return on the capital employed. 
  ARAB REPUBLIC OF EGYPT
 
 
• Concerning Import License 
 I- Page 35,  III-Trade Policies And Practices By Measure, (2) Measures Directly Affecting 
Imports, (i) Procedures, (a) Registration and Documentation: 
 Paragraph 13 states that for some imported goods "Import permits for pr oducts subject to restrictions 
and health and sanitary certificates must be obtaine d prior to import from the relevant Government 
departments and submitte d along with the Customs declaration." 
 
Question:  
 It would be appreciated if a list of those products be provided. 
 
Reply: Imports of all primary agricultural products are subject to a Bio Security & Sanitary-Phyto 
Sanitary import permit, which is issued by the De partment of Agriculture and Co-operation, as per 
conditions of Plants, Fruits and Seeds (Regul ation of Import into India) Order, 1989.   
 
II- Page 46, (ix) Import prohibitions, restrict ions, and licensing, (a) Import prohibitions: WT/TPR/M/182/Add.1 
Page 298  
 
  Paragraph 37 states that "Import prohibitions are maintained under Section 11 of the Customs Act 
1962.  Under the Act, the Government may, by notific ation in the Official Gazette, impose absolute or 
conditional import (or export) prohi bitions.  Such measures can be maintained for, inter alia, 
security, public order and standards of decency or mo rality, prevention of smuggling or shortage of 
goods, foreign exchange and balance of payments rea sons, prevention of agricultural surpluses, 
standards, intellectual property, and the conservation of exhaustible resources."  
 Questions:  A clarification is needed on those products on wh ich absolute import prohibitions are imposed, to 
distinguish them from those on which a conditiona l import prohibition is imposed, and what are the 
conditions calling for cond itional import prohibition. 
 
Reply:  Absolute import prohibition means that the goods can not be imported into India and their 
imports are violative of the domestic laws. On th e other hand, conditional im port prohibitions (i.e. 
import restrictions) are imposed so as to comply wi th the statutory obligations of certain domestic 
Acts. The import of such goods is permitted subj ect to the fulfilment of conditions/statutory 
requirements as specified in the notification of the G overnment of India. Consequent to the fulfilment 
of the specified conditions, goods are allowed entry into India. 
 
Would import licences required for the importati on of goods classified under Exim codes 2515 11 00, 
2515 12 10, 2515 12 90, 6802 10 00, 6802 21 10, and 6802 21 20 fall under the classification of 
imports subject to conditional prohibitions? And if  so what is the reason behind such a measure? 
 
Reply: An Import license is required for the impor tation of goods classified under Exim codes 
25151100, 25151210, 25151290 to provide adequate pr otection to domestic marble mining.  India 
produces relatively low priced marble and imports of  similar quality marble hurts the employment 
prospects of domestic workers.  Marble mining in India is in the primary sector of the economy.  The concerns arise out of the high unemployment prevailing among the unskilled labour in India.  
  However, no import license is required fo r the import of items falling under 68021000, 
68022110 and 68022120. These items are freely importable  subject to a value cap of USD 2700/ cubic 
meter. This is to prevent imports of low priced marble into India, which would have an adverse 
impact on domestic workers.  
Would India clarify whether imports of products falling under Exim codes  6802 10 00, 6802 21 10, 
and 6802 21 20   of a cif value below USD 2700 per cubic meter, are prohibited or not ? And if not, 
what is the basis for determining the threshol d of USD 2700 per cubic meter for free importation? 
What are the requirements for importing products fall ing under Exim codes  6802 10 00, 6802 21 10, 
and 6802 21 20   of a cif value below  USD 2700 per cubic meter.
13 
 
Reply: Imports of items falling under 68021000, 68022110 and 68022120 are governed by 
Notification No. 23 dated 31.8.2005, Notificati on No. 24 dated 31.8.2005 and Notification No. 26 
dated 2.9.2005 refers (Available on website: http ://dgft.gov.in). Products classified under Exim codes 
68021000, 68022110 and 68022120 cannot be importe d below a floor price of USD 2700/ cubic 
metre.  
                                                     
 
 13 NOTIFICATION No. 23 ( RE-2005)/2004-2009, NEW DELHI: Dated Agust, 2005 & No.26 ( RE-
2005)/2004-2009, NEW DELHI: Dated 2nd September , 2005.  WT/TPR/M/182/Add.1 
 Page 299 
 
 
  III- Page 47, (ix) Import prohibitions, restrictions, and licensing, (b) Import restrictions and 
licensing  Paragraph 39 states that "Import restrictions c an be imposed under the Customs Act, 1962 and the 
Foreign Trade (Development and Regulation) Act, 1992.   Some 415 tariff lines (around 3.5% of the 
tariff) at the HS 8-digit level a re currently subject to import restrictions under Articles XX and XXI of 
the GATT.  The items are mainly in sections 19 (a rms and ammunition), 1 (live animals), 21 (works of 
art), 5 (mineral products) and 2 ( vegetable products) (Chart III.4).  
 Questions: 
 
Where do the import restrictions imposed on goods  classified under Exim codes 2515 11 00, 2515 12 
10, 2515 12 90 fit in the sections identified in (Char t III.4)? What is the basis for imposing such a 
restriction?   
Reply: Import restrictions on goods classified under Ex im Codes 2515 11 00, 2515 12 10, 2515 12 90 
are placed under Article XX (g) of GATT. Marble mining in India is subject to licensing and 
production control. Accordingly, the restri ctions on imports have also been placed.  
 
What are the eligibility criteria for obtaining licen ces for imports of products falling under the above 
identified Exim codes? How were the floor prices,  for which such licences are subject, determined 
and what is the basis for imposing such a requirement?   
 
Reply: The eligibility criteria for obtaining an import li cense for the above items is based upon Policy 
Circular No.24 dated 30.8.2005 and Policy Circ ular NO.34 dated 30.11.2005. (Available at the 
website: http://dgft.gov.in ). The floor price has been fixed to prevent overexploitation of natural 
resources. 
 
Paragraph 40 states that "India also monitors impor ts of some 300 items that are considered to be 
sensitive.  The monitoring mechanism was set up a fter the removal of quantitative restrictions on 
imports in 2002.  The products, which are monitored by a committee chaired by the Secretary of the 
Department of Commerce, include edible oil, cotto n, silk, milk and milk pr oducts, cereals, fruit and 
vegetables, spices, automobiles, tea, coffee, alcoholic beverages and products produced by the 
small-scale industry.  Imports of certain items , including second-hand cars (over three-years old) and 
imports from Sri Lanka subject to preferential ta riffs (such as tea), mu st be imported through 
specified ports (Mumbai for second- hand cars, Kochi and Kolkata for tea and Chennai, Mumbai and 
Jawaharlal Nehru Port Mumbai for garments). "  
 
Questions: 
 
In this  context, How would India explain the impos ition of a ceiling of 1.30 Lakh MT per licensing 
year
14 on the imports of rough marble blocks under Ex im codes 2515 11 00, 2515  12 10, 2515 12 90? 
What is the basis for imposing such a quantitative restriction? 
 Reply: Under the licensing regime operated since 2001,  approximately 65,000 MT of marble was 
allowed to be imported annually dur ing the period 2001-02 to 2004-05.  As per changes carried out in 
the policy, this quantum has been raised to 130,000 MT annually.  The revised ceiling fully recognizes the strong growth of the constructi on industry in India in the last few years.  
 
What are the items that fall in the sensitive list of the 300 products? 
 
                                                     
 
 14 Policy Circular No. 24 ( RE-05)/2004-2009 dated 30-8-2005 WT/TPR/M/182/Add.1 
Page 300  
 
  Reply: The items that fall in the sensitive list are: 
 
 HS Code Description 
   Meat and Poultry products 
1 02071100 MEAT/EDBL OFAL OF FOWLS OF THE SPCS GALS  DOMESTICUS NOT CUT IN PIECES, 
FRES/CHILLED 
2 02071200 MEAT/EDBL OFAL OF FOWLSOF THE SPCS GALS DOMESTICUS NOT CUT IN PIECES,FROZEN 
3 02071300 CUTS & OFAL OF FWLS OF THE SPCS GALS DOMSTCS.FRSH/CHILD 
4 02071400 CUTS & OFAL OF FWLS OF THE SPCS GALS DOMSTCS. Frozen 
5 02072400 Not cut in pieces, MEAT & EDBL OF AL OF TURKYS WHOL fresh or chilled  
6 02072500 Not cut in pieces,MEAT& EDIBLE  OFALS OF TURKEYS WHOLE frozen  
7 02072600 Cuts and offal TU RKEYS, fresh or chilled  
8 02072700 Cuts and offal TURKEYS, frozen 
9 02073200 MEAT & EDBL OFAL OF DUCKS,GEESE/GUI NEA FOWLS, NOT CUT IN PIECES FRSH/CHILLED 
10 02073300 MEAT & EDBL OFAL OF DUCKS,GEESE/ GUINEA FOWLS, NOT CUT IN PIECES ,FROZEN 
11 02073400 Fatty livers OF DUCKS,GEESE/GU INEA    FOWLS, fresh or chilled  
12 02073500 Other, fresh or chilled Of ducks, geese or guinea fowls 
13 02073600 Other, frozen Of ducks, geese or guinea fowls 
   Milk & Milk Products 
14 04011000 MLK & CRM ETC CONTNG FAT content by NOT EXCDNG 1% 
15 04012000 MLK & CRM CONTNG FAT>1% BUT<=6% BY WT 
16 04013000 MILK AND CREAM CONT NG FAT EXCDNG 6% BY WT 
17 04021010 Skimmed Milk  
18 04021020 Milk food for babies  
19 04021090 OTHERS MILK & CREAM IN POWDER OR OTHER SOLID FORMS CONTAINING FAT NOT 
EXCEEDING 1.5% BY WT 
20 04022910 Whole milk  
21 04022920 Milk for babies  
22 04022990 OTHERSN(E.G.MILK CREAM) 
23 04029190 OTHR MILK OR CRM NOT CONTNG SWETNG MATTER 
24 04029110 Condensed Milk  
25 04029910 Whole milk  
26 04029990 OTHERS MILK & CREAM CONTAINING SWEET ETC. 
27 04051000 Butter  
28 04052000 Dairy Spreads  
29 04059010 Butter Oil  
30 04059020 Ghee  
31 04059090 Fats derived from milk other than Butter oil and Ghee 
   Fruits & Vegetables 
32 08011100 COCONUT DESICCATED 
33 08011910 COCONUT FRESH 
34 08011920 COCONUT ,DRIED 
35 08012100 Brazil nuts: In shell  
36 08012200 Brazil nuts: Shelled 
37 08013100 Cashew nuts: In shell  
38 08013290 Other Cashew nuts  
39 08013210 Cashew kernel, broken  
40 08013220 Cashew kernel, whole  
41 08021100 ALMONDS FRSH OR DRIED IN SHELL 
42 08021200 SHELLED ALMONDS FRSH OR DRIED 
43 08022100 HAZELNUTS IN SHELL,FRSH OR DRIED 
44 08022200 SHELLED HAZELNUTS, FRSH OR DRIED 
45 08023100 WALNUTS FRSH OR DRIED IN SHELL 
46 08023200 SHELLED WALNUTS FRSH OR DRIED 
47 08024000 CHESTNUTS (CASTANEA SPP) FRSH OR DRIED 
48 08025000 PISTACHIOS FRESH OR DRIED  WT/TPR/M/182/Add.1 
 Page 301 
 
 
   HS Code Description 
49 08029011 Betel nut, whole 
50 08029012 BETEL NUT, Split  
51 08029022 BETEL NUT, Ground  
52 08029019 OTHER BETEL NUT 
53 08029090 OTHERS (NUTS FRESH OR DRIED) 
54 08051000 Oranges  
55 08052000 Mandarins (including tangerines and satsumas); clementines, w ilkings and similar citrus hybrids.  
56 08055000 Lemon (citrus limon citrus limonum) and limes (citrus aurantifolia, citrus latifolia)  
57 08054000 Grapefruit  
58 08059000 OTHER CITRUS FRUITS FRESH OR DRIED 
59 08061000 GRAPES FRESH 
60 08062010 Raisins  
61 08062090 SULTANAS & OTHER DRIED GRAPES 
62 08081000 Apples FRESH 
63 08082000 Pears and quinces FRESH 
64 08101000 Strawberries FRESH 
65 08102000 Raspberries, blackberries, mulberries and loganberries FRESH 
66 08103000 Black, white or red currants and gooseberries FRESH 
67 08104000 Cranberries, bilberries and othe r fruit of the genus Vaccinium FRESH 
68 08105000 Kiwi fruit  
69 08109010 POMEGRANATES FRESH 
70 08109020 Tamarind, fresh  
71 08109030 Sapota (chico) FRESH 
72 08109040 Custard-apple (Ata)  
73 08109050 Bore  
74 08109060 Lichi  
75 08109090 Other  fresh 
   Tea & Coffee 
76 09011111 COFFEE ARABICA PLANTATION`A` 
77 09011112 COFFEE ARABICA PLANTATION`B` 
78 09011113 COFFEE ARABICA PLANTATION`C` 
79 09011119 COFFEE ARABICA PLANTATION OTHER GRADE 
80 09011121 COFFEE ARABICA CHERRY AB 
81 09011122 COFFEE ARABICA CHERRY PB 
82 09011123 COFFEE ARABICA CHERRY C 
83 09011124 COFFEE ARABICA CHERRY B/B/B 
84 09011129 COFFEE ARABICA CHERRY OTHER GRADE 
85 09011131 COFFEE ROB PARCHMENT AB 
86 09011132 COFFEE ROB PARCHMENT PB 
87 09011133 COFFEE ROB PARCHMENT C 
88 09011139 COFFEE ROB PARCHMENT OTHER GRADE 
89 09011141 COFFEE ROB CHERRY AB 
90 09011142 COFFEE ROB CHERRY PB 
91 09011143 COFFEE ROB CHERRY C 
92 09011144 COFFEE ROB CHERRY B/B/B 
93 09011145 COFFEE ROB CHERRY BULK 
94 09011200 NOT ROASTED BUT DECAFFEINATED COFFEE 
95 09012110 ROASTED NOT DECAFFEINA TED COFFEE In bulk packing  
96 09012190 Other ROASTED NOT DECAFFEINATED COFFEE 
97 09012210 In bulk packing   ROASTED DECAFFEINATED COFFEE 
98 09012290 Other    ROASTED DECAFFEINATED COFFEE 
99 09019010 Coffee husks and skins  
100 09019020 Coffee substitutes containing coffee  
101 09019090 Other  
102 09022010 Green Tea in packets exceeding content 3 kg but not exceeding 20 kg  WT/TPR/M/182/Add.1 
Page 302  
 
   HS Code Description 
103 09022020 Green Tea in bulk  
104 09022030 Green Tea agglomerated in the forms such as ball, brick and tablets  
105 09022040 Green Tea waste  
106 09024010 Black Tea in packets exceeding content 3 kg. But not exceeding 20 kg  
107 09024020 Black Tea, leaf in bulk  
108 09024030 Black Tea, dust in bulk  
109 09024040 Tea bags  
110 09024050 Black Tea, agglomerated in the form such as ball, brick and tablets  
111 09024060 Black Tea waste  
   Spices 
112 09030000 Mate  
113 09041110 Pepper, long  
114 09041120 Light black pepper  
115 09041130 Black pepper, garbled  
116 09041140 Black pepper ungarbled  
117 09041150 Green pepper, dehydrated  
118 09041160 Pepper pinheads  
119 09041170 Green pepper, Frozen Dried  
120 09041180 Pepper , Frozen  
121 09041190 Other Pepper 
122 09041200 Crushed or ground  Pepper 
123 09042030 Fruits of the genus capsicum  
124 09042050 Jamaica pepper (pimenta/all spices)  
125 09050010 VANILA BEAN 
126 09050020 VANILLA POWDER 
127 09050090 OTHER VANILLA EXCLDNG VNLA BEAN & PWDR 
128 09061010 Cassia  
129 09061020 Cinnamon bark  
130 09061030 Cinnamon tree flowers  
131 09061090 Other than Cinnamon bark , Cinnamo n tree flowers , neither crushed or grind 
132 09062000 Cinnamon and its tree flowers  Crushed or ground  
133 09070010 Cloves Extracted  
134 09070020 Cloves Not extracted (other than stem)  
135 09070030 Cloves Stems  
136 09070090 Other cloves 
137 09083010 CARDAMOMS Large (amomum)  
138 09083020 CARDAMOMS  Small (elettaria),  
139 09083040 CARDAMOMS  Small-bleached, half-bleached or bleachable  
140 09083050 CARDAMOMS  Small seeds  
141 09083060 CARDAMOMS  Small (mixed)  
142 09083070 CARDAMOMS  Powder  
143 09083090 Other  CARDAMOMS  
144 09101010 GINGER Fresh  
145 09101020 GINGER Dried, unbleached  
146 09101030 GINGER Dried, bleached  
147 09101040 GINGER Powder  
148 09101090 GINGER,NES INCL DRIED 
149 09104010 Tejpat (leaves of cassia lignea)  
   Wheat & Rice 
150 10011010 DURUM WHEAT Of seed quality  
151 10019020 Wheat (not seed) for human consumption 
152 10019031 MESLIN Of seed quality  
153 10051000 MAIZE CORN Seed  
154 10059000 Other MAIZE CORN  
155 10061010 Rice in husk (paddy or rough): Of seed quality   WT/TPR/M/182/Add.1 
 Page 303 
 
 
   HS Code Description 
156 10061090 Rice in husk (paddy or rough): Other  
157 10062000 Husked (Brown) Rice  
158 10063010 Rice, parboiled  
159 10063020 Basmati rice  
160 10063090 Other Rice ( except Parboiled rice and Basmati rice ) 
161 10064000 Broken rice  
162 11010000 Wheat or meslin flour  
   Edible Oils 
163 15071000 Soya-bean oil and its fractions, whether or not refined,  but not chemically modifi ed : Crude, whether or not 
degummed  
164 15079010  Other Soya bean oil and its fractions :Edible grade  
165 15079090  Other Soya bean oil and its fractions :Non - Edible grade  
166 15081000 Crude Groundnut Oil and its fractions, whethe r or not refined but not chemically modified 
167 15089010 Deodorized (Salad Oil) 
168 15089091 OTHERS GROUND NUT OIL AND ITS FRACTIONS, WHETHER OR NOT REFINED, BUT NOT 
CHEMICALLY MODIFIED : Edible Grade  
169 15111000 Crude Palm oi l and its  fractions 
170 15119010 RBD Palm Oil  
171 15119020 RBD Palmolein  
172 15119090 Other than RBD Pa lm oil and RBD Palmolein 
173 15121110 Sunflower Seed Oil : Crude  
174 15121120 Safflower Seed Oil (Kardi Seed Oil) : CRUDE 
175 15121910 Sunflower seed oil, edible gradeOther than  CRUDE  
176 15121920 Sunflower oil, non-edible grade Other than crude 
177 15121930 Saffola oil, edible grade  other than CRUDE 
178 15122100 Crude Oil, whether or not gossypol has been removed  
179 15122910 Other cotton seed oil and its fractions : Edible grade , CRUDE 
180 15131100 COCONUT (COPRA) CRUDE OIL & FRACTIONS 
181 15131900 COCONUT (COPRA) REFINED OIL & FRACTIONS 
182 15132110 Crude Palm Kernel  Oil and its fractions 
183 15132120 Crude Babassu Oil and its fractions 
184 15132910 Refined Palm Kernel  Oil and its fractions  
185 15132920 Refined Babassu Oil a nd fractions edible grade  
186 15132990 Othre refined palm  kernal / Babassu oils 
187 15141110 Crude : Colza Oil  
188 15141120 Crude : Mustard Oil  
189 15141190 Crude : Rapeseed Oil  
190 15141910 Refined colza oil of edible grade  
191 15141920 Refined mustard oil of edible grade  
192 15141930 Refined rapeseed oil of edible  
   Sugar 
193 17011110 Raw Cane jaggery  
194 17011190 Other Cane sugar 
   Liquers 
195 22082011 Brandy in contai ners holding 2 ltr or less 
196 22082012 Liquors in containers holding 2 ltr or less 
197 22082019 Other spirits in containers holding 2 ltr or less 
198 22082091 Brandy in containers holding 2 ltr or more 
199 22082092 Liquors in containers holding 2 ltr or more 
200 22082099 Other spirits in containers holding 2 ltr or more 
201 22083011 Bourbon whiskey in cont ainers holding 2 ltr or less 
202 22083012 Scotch in contai ners holding 2 ltr or less 
203 22083013 Blanded Whiskies in c ontainers holding 2 ltr or less 
204 22083019 Other Whiskies in c ontainers holding 2 ltr or less 
205 22083091 Bourbon whiskey in containers holding 2 ltr or more WT/TPR/M/182/Add.1 
Page 304  
 
   HS Code Description 
206 22083092 Scotch in containers holding 2 ltr or more 
207 22083093 Blanded Whiskies in c ontainers holding 2 ltr or more 
208 22083099 Other Whiskies in cont ainers holding 2 ltr or more 
209 22084011 Rum in containers holding 2 ltr or less 
210 22084012 Tafia in containers holding 2 ltr or less 
211 22084091 Rum in containers holding 2 ltr or more 
212 22084092 Tafia in containers holding 2 ltr or more 
213 22085011 Gin in containers holding 2 ltr or less 
214 22085012 Geneva in contai ners holding 2 ltr or less 
215 22085091 Gin in containers  holding 2 ltr or more 
216 22085092 Geneva in containe rs holding 2 ltr or more 
217 22086010 Vodka  in contai ners holding 2 ltr or less 
218 22086090 Vodka  in containe rs holding 2 ltr or more 
219 22087011 Liquers in containers holding 2 ltr or less 
220 22087012 Cordials in containers holding 2 ltr or less 
221 22087091 Liquers in containers holding 2 ltr or more 
222 22087092 Cordials in containers holding 2 ltr or more 
223 22089011 Tequila in containers holding 2 ltr or less 
224 22089012 Indenatured in cont ainers holding 2 ltr or less 
225 22089019 Others in contai ners holding 2 ltr or less 
226 22089091 Tequila in containers holding 2 ltr or more 
227 22089092 Indenatured in contai ners holding 2 ltr or more 
228 22089099 Others in containe rs holding 2 ltr or more 
   Cigarettes 
229 24021010 Cigar and cheroots  
230 24022010 Other than filter cigarettes, of length not exceeding 60 millimetres  
231 24022020 Other than filter cigarettes, of length exceed ing 60 millimetres but not exceeding 70 millimetres  
232 24022030 Filter cigarettes of length (including the length of the filter , the length of filter being 11 millimetres or its actual 
length, whichever is more) not exceeding 70 millimetres  
233 24022040 Filter cigarettes of length (including the length of the filter , the length of filter being 11 millimetres or its actual 
length, whichever is more) exceeding 70 millimetres but not exceeding 75 millimetres  
234 24022050 Filter cigarettes of length (including the length of the filter , the length of filter being 11 millimetres or its actual 
length, whichever is more) exceeding 75 millimetres but not exceeding 85 millimetres  
235 24022090 OTHERS CIGARETTES CONTAINING TOBACCO  
236 25010010 Common Salt (including iodised salt)  
237 25010020 Rock Salt  
238 25010090 OTHER SALTS 
   Rubber 
239 40011020 NATRL RUBR LATEX NOT PREVULCANISED 
240 40011010 PREVULCANISED NATRL RUBR LATEX 
241 40012100 Natural rubber in other forms : Smoked sheets  
242 40012940 Oil extended natural rubber  
243 40028020 Chemically modified form of  natural rubber including graft rubber  
244 40012200 Natural rubber in other forms : Tech nically specified natural rubber (TSNR)  
245 40012910 Hevea  
246 40012920 CREPE RUBBER FROM LATEX-PALE LATEX CREPE 
247 40012930 Estate Brown Crepe  
248 40012990 OTHER NATRL RUBBR NON-LATEX 
249 40013000 Balata, gutta-percha, guayule, chicle, and similar natural gums  
   Silk 
250 50020010 Mulberry raw silk  
251 50020030 Non-Mulberry silk  
252 50020020 Mulberry dupion silk  
253 50040010 MULBERRY DUPION SILK YARN 
254 50040090 Other 100% mulberry dupion silk yarn 
255 50050012 Yarn spun from silk waste, not put up for retail sale Containing 85% or more  by weight of silk waste :  From  WT/TPR/M/182/Add.1 
 Page 305 
 
 
   HS Code Description 
noil silk 
256 50050022 Yarn spun from silk waste, not put up for retail sale  Containing less than 85% by weight of silk:   From noil 
silk  
257 50050011 Yarn spun from silk waste, not put up for retail sale Containing 85% or more  by weight of silk waste :  Other 
than noil silk  
258 50050021 Yarn spun from silk waste, not put up for retail sale  Containing less than 85%  by weight of silk:   Other than 
noil silk  
259 50060011 Silk yarn : Silk embroidery thread  
260 50060021 Yarn spun from silk waste C ontaining 85% or more by weight of silk:   Silk embroidery thread  
261 50060031 Silk yarn spun from silk waste other than no il silk Containing 85% or less by weight of silk:  
262 50060019 SLK YRN PUT UP  FOR OTHR PURPS (OTHR THN EMBROIDRY) 
263 50060029 SLK YRN SPUN FRM SLK WAST Containing 85% or more by weight of silk: PUT UP  FOR OTHR PURPS 
(OTHR THN EMBROIDRY) 
264 50060039 SLK YRN SPUN FRM SLK WAST Containing 85% or less by weight of silk: PUT UP  FOR OTHR PURPS 
(OTHR THN EMBROIDRY) 
265 50060033 Silk embroidery thread : Yarn spun from s ilk waste Containing 85% or less by weight of silk 
   Cotton 
266 52010011 BENGAL DESHI COTTON 
267 52010012 Indian cotton of staple lengths 20 5 mm (25/32") a nd below (e g. oomras, yellow picking, Assam Comillas)  
268 52010013 Indian cotton of staple length exceeding 20 5mm (26/32") and but not exceeding 24 5mm (30/32")  
269 52010014 Indian cotton of staple le ngth over 24 5 mm (31/32”) to 28 mm  
270 52010015 Indian cotton of staple length 28 5 mm (1 4/32”) and above but below 34 5 mm  
271 52010019 Indian cotton of all staple  length 34 5 mm and above (1 12/32”)  
272 52010020 Cotton, other than Indi an, of all staple lengths  
273 52030000 Cotton, carded or combed  
   Small Scale Sector ( Umbrella) 
274 66011000 n125 
275 66019100 UMBRELLAS HAVING A TELESCOPIC SHAFT 
276 66019900 OTHER UMBRELLAS 
   Marble 
277 68022110 MARBLE BLOCKS/TILES,POLISHED 
278 68022120 Marble monumental stone  
279 68022190 OTHERS (SIMPLY CUT/SAWNMARBLE TRAUERTINE & ALABASTER WITH A FLAT OR EVEN 
SINFACE  
280 68022310 GRANITE BLOCKS/TILES,POLISHED 
281 68022390 OTHERS SIMPLE CUT/SAWN GANITE WITH A FLT/EVN SUIFACE  
282 68029100 Marble, travertine and alabaster  
283 68029200 Other calcareous stone  
284 68029300 Other Granite  
285 68029900 Other stone  
   Small Scale Sectore (Ceramic Tiles) 
286 69081010 Ceramic mosaic cubes  
287 69081020 Ceramic mosaic tiles  
288 69081090 OTHERS TILES ETC W/N RETNGER THE LAGST SRFC AREA  OF which is capable of being enclosed in a 
square the side of which is less than 7 cm.: 
289 69089010 Other Ceramic mosaic cubes  
290 69089020 Other Ceramic mosaic tiles  
291 69089090 Tiles and cubes other than mosaic tiles and cubes 
   Small Scale Sectore (Glass & Glassware) 
292 70131000 Glassware Of glass-ceramics 
293 70132100 DRINKING GLASSES OF LEAD CRYSTAL 
294 70132900 OTHER DRINKING GLASSES 
295 70133100 GLSWRE OF LEAD CRYSTL USD FR TABLE / KTCHN PURPOSE  
296 70133200 of glass having a linear coefficient of expantion not exceeding certain specification 
297 70133900 Other glassware used  for table excluding glasses 
298 70139110 OTER GLASSWARE OF LEAD CRYSTAL 
299 70139190 Other glassware of lead cr ystals other than glass statues WT/TPR/M/182/Add.1 
Page 306  
 
   HS Code Description 
300 70139910 Glass statues excluding of lead crystals 
301 70139990 Glassware other than  st atues excluding of lead crystals 
   Small Scale Sectore (Locks) 
302 83011000 Padlocks  
303 83012000 Locks of a kind used for motor vehicles  
304 83013000 Locks of a kind used for furniture  
305 83014010 Combination locks  
306 83014090 Other THAN COMBINATION LOCKS 
307 83015000 Clasps and frames with  clasps, incorporating locks  
   Motor Cars 
308 87032110 Vehicles principally designed for the transport of more than seven persons. Of a cylinder capacity not 
exceeding 1000 cc :  
309 87032191 Motor cars Of a cylinder capacity not exceeding 1000 cc :  
310 87032192 Jeeps and Rover type vehicles Of a cylinder capacity not exceeding 1000 cc :  
311 87032199 Other vehicles Of a cylinder capacity not exceeding 1000 cc :  
312 87032193 Specailised transport vehciles. (e.g. ambulances, prison va ns and the like) Of a cylinder capacity not exceeding 
1000 cc :  
313 87032291 Motor cars Of a cylinder capacity ex ceeding 1000 cc but not exceeding 1500 cc :  
314 87032292 Jeeps and Rover type vehicles Of a cylinde r capacity exceeding 1000 cc but not exceeding 1500 cc :  
315 87032299 Other vehicles Of a cylinder capacity exceeding 1000 cc but not exceeding 1500 cc :  
316 87032293 Specailised transport vehciles. (e.g. ambulances, prison vans and the like) Of a cylinder capacity exceeding 
1000 cc but not exceeding 1500 cc :  
317 87032310 Vehicles principally designed for the transport of more than seve n persons. Of a cylinder capacity >= 1500 cc :  
318 87032391 Motor cars Of a cylinder capacity ex ceeding 1500 cc but not exceeding 3000 cc :  
319 87032392 Jeeps and Rover type vehicles Of a cylinde r capacity exceeding 1500 cc but not exceeding 3000 cc :  
320 87032399 Other vehicles Of a cylinder capacity exceeding 1500 cc but not exceeding 3000 cc :  
321 87032393 Specialized transport vehicles. (e.g. ambulances, prison vans and the like) Of a cylinder capacity exceeding 
1500 cc but not exceeding 3000 cc :  
322 87032410 Vehicle with cylinder capacity >= 3000 cc 
323 87032491 Motor cars Of a cylinder capacity exceeding 3000 cc :  
324 87032499 Other vehicles Of a cylinder capacity exceeding 3000 cc :  
325 87033191 Motor cars Of a cylinder capacity not exceeding 1500 cc : (Diesel or semi diesel) 
326 87033192 Jeeps and Rover type vehicles Of a cylinder capacity not exceeding 1500 cc : (Diesel or semi diesel) 
327 87033199 Other vehicles Of a cylinder capacity not exceeding 1500 cc : (Diesel or semi diesel) 
328 87033193 Specailised transport vehciles. (e.g. ambulances, prison va ns and the like)  Of a cylinder capacity not exceeding 
1500 cc : (Diesel or semi diesel) 
329 87033210 Vehicle with comprsn/ignition capacity >1500 cc 
330 87033291 Motor cars Of a cylinder capacity exceeding 150 0 cc but not exceeding 2500 cc (Diesel or semi diesel) 
331 87033292 Jeeps and Rover type vehicles Of a cylinder capacity  exceeding 1500 cc but not exceeding 2500 cc (Diesel or 
semi diesel) 
332 87033299 Other vehicles Of a cylinder capacity exceeding 1500 cc but not exceeding 2500 cc (Diesel or semi diesel) 
333 87033293 Specailised transport vehciles. (e.g. ambulances, prison vans and the like) Of a cylinder capacity exceeding 
1500 cc but not exceeding 2500 cc (Diesel or semi diesel) 
334 87033310 Vehicle with comprsn/ignition capacity >2500 cc 
335 87033391 Motor cars Of a cylinder capacity ex ceeding 2500 cc (Diesel or semi diesel) 
336 87033392 Jeeps and Rover type vehicl es Of a cylinder capacity exceedi ng 2500 cc (Diesel or semi diesel) 
337 87033399 Other Of a cylinder capacity exce eding 2500 cc (Diesel or semi diesel) 
338 87033393 Specailised transport vehciles. (e.g. ambulances, prison vans and the like) Of a cylinder capacity exceeding 
2500 cc (Diesel or semi diesel) 
339 87039010 Electrically operated  
340 87039090 Other motor vehicle not electrically opertaed  
   Small Scale Sector ( Toys) 
341 95010010 Wheel toys designed to be ridden by children; dolls carriages  
342 95021010 DOLLS OF WOOD 
343 95021020 DOLLS OF METAL 
344 95021030 DOLLS OF PLASTIC 
345 95021090 OTHERS (GOLLS REPRE SSINTING ONLY HU MAN BEINGS   WT/TPR/M/182/Add.1 
 Page 307 
 
 
   HS Code Description 
346 95031000 Electric trains, including tracks, signals and other accessories therfor  
347 95032000 Reduced-size (“scale”) model assembly kits, whether or  not working models, excluding those of sub-heading 
9503 10  
348 95033000 Other construction se ts and constructional toys 
349 95034100 STFFD TOYS RPRSNTNG ANMLS/NON-HUMAN CREATR 
350 95034910 TOYS OF WOOD 
351 95034920 TOYS OF METAL 
352 95034930 TOYS Of plastics  
353 95034990 OTHERS OTHR TOYS RPRSNTING AMMLS/NON HUMAN GEATRS  
354 95035010 T0Y MUSICAL INSTRUMENT AND APPARATUS 
355 95036010 Puzzles:  Of wood  
356 95036090 Puzzles:  Other THAN WOOD 
357 95039010 Toy weapons  
358 95039020 Other toys  
   Small Scale Sector ( Writing Instruments) 
359 96081010 With Liquid ink ( for rolling ball pen)  
360 96081090 Other  
361 96082000 Felt tipped and other por ous-tipped pens and markers 
362 96083110 Stylograph pens  
363 96083190 OTHERS INDIAN INK DRAWING PENS 
364 96083910 High value writing instruments in cluding foutain pens and ball point pens  (US $ 100 per unit c.I.f. and above)  
365 96083911 With body or cap of precious metal or rolled precious metal  
366 96083919 Other 
367 96083921 other fountain pens with body or cap of precious metal or rolled precious metal  
368 96083929 Other 
369 96083991 With body or cap of precious metal or rolled precious metal  
370 96083999 Other  
371 96084000 Propelling or sliding pencils  
 
• Concerning Government Procurement: 
 Page 34, III-Trade Policies and Practices By  Measure, (1) Overview, Paragraph (5): 
Question: 
  Egypt would like to know what amendments Indi a’s Central Government made in order to enhance 
transparency and competition in procurement procedures?   Reply: 
 
• Transparency and competition have always been integral to procurement procedures in India.  
• The prevailing “General Financial Rules ” of the Government of India are required to be 
followed by all Government Ministries/De partments. Manuals on Goods, Works and 
Consultancy have been issued to provide guide lines to Ministries/Departments in matters of 
procurement. General Financial Rules and Manua ls prescribe that the procurement should be 
done in an open transparent and competitive manner.   
• Procurements are to be done by following the prescribed tender procedures .  
• Bids are opened in front of the representatives of  bidders and the names of successful bidders 
are put on the web sites and notice boards.  
• To enhance transparency and competition, tenders are posted on the websites of the 
Ministries/Departments and are also widely publicised.  
• Initiatives have also been taken towards e-procurement,  to ensure that the transactions are 
done electronically.  WT/TPR/M/182/Add.1 
Page 308  
 
  Paragraph 5 states that “It seems, however, that preferences remain for products manufactured by 
the small-scale sector and state-owned enterprises.  India is not a party to the WTO's Agreement on 
Government Procurement.”  Question:  
 
Egypt requests more details as to the kind of pref erences that India gives to the small–scale sector 
and the state–owned enterprises?  
 
Reply:   There is a Purchase Preference Policy(PPP) for the products and services of the Central 
Public Sector Enterprises(CPSEs), which will cease to  exist w.e.f. 31.3.2008  as per the decision of 
the Government of India.   The salient features of this purchase preference policy are as follows: 
 
(i) If the price quoted by a Central Public Sector Enterprise (CPSE) is within 10% of the lowest 
(L1) price, purchase preference will be given to that CPSE at the L1 price. 
(ii) Purchase Preference Policy (PPP) support will be ex tended to the contracts of the value of Rs. 
50 million and above but not exceeding Rs. 1 billion. If civil works are included as a part of a contract for the supply of goods and / or if the contract is a turnkey contract, such contracts 
would also be covered by the PPP, subject to th e condition that the total value of the contract 
does not exceed Rs. 1 billion.  
(iii) PPP will apply only to CPSEs and their subsid iaries (i.e. where a PSE owns 51% or more 
shares of a subsidiary), but not to a joint venture owned by a PSE and a private sector partner.  
(iv) A minimum value addition of 20% by the CPSEs/subsidiary companies by way of 
manufacturing and / or services would be a prerequisite for availing of the purchase 
preference.  
(v) The provisions relating to purchase preference should be specified in the Notice Inviting 
Tenders (NIT) for Rs. 50 million and a bove but not exceeding Rs. 1 billion.  
(vi) PSEs should be subject to the same qualification process as any other bidder. If the PSE does 
not meet the minimum qualifications, it should be  subject to disqualification. However, in 
suitable cases, the purchasers / clients may relax the condition of “net worth” from the list of 
minimum qualifications. 
(vii) If the PSE, which has had the benefit of the Purc hase Preference Policy, fails to perform, it 
should also be subject to payment of liquidate d damages or any other penalty included in the 
contract. 
(viii) Each Ministry shall make a list of CPSEs th at would require PPP support and if there is no 
possibility of making a positive list, they may a ttempt a negative list of CPSEs which may not 
require PPP support.  
 Under the Central Government’s existing Purchase and Price Preference Policy for SSIs, Government 
of India has been providing various facilities/benefits  to SSI units registered with the National Small 
Industries Corporation (NSIC) under its single point registration scheme viz. (i) Supply of Tender Sets 
free or cost; (ii) Exemption from payment of Earnest Money: (iii) Waiver of Security Deposit upto the 
monetary limit for which the unit is registered; and  (iv) Price Preference upto 15% over the quotation 
of large-scale units.  In addition to the above, 35 8 items are reserved for exclusive purchase by the 
Government departments from the SSI sector. The lis t of these items is available at http://www.laghu-
udyog.com/publications/reserveditems/Itemssi.htm.  WT/TPR/M/182/Add.1 
 Page 309 
 
 
  • Concerning Trade Facilitation: 
 I- Page 35,  III-Trade Policies And Practices By Measure, (2) Measures Directly Affecting Imports, (i) Procedures, (a) Registration and Documentation:  
Paragraph 14 states that “The electronic data inte rchange (EDI) system was introduced in May 1995 
and is applied at all major ports and air cargo compl exes.  It is operational in 34 customs stations, 
and about 85% to 90% of import/export doc uments are processed electronically” 
 Question:   
Egypt kindly requests India to share its experience on the introduction and implementation of EDI at 
ports and Customs stations, particularly in terms of time it took to implement and effort (donor-
assisted) or indigenous? What specific  challenges needed to be overcome?  
 
Reply:  The EDI project was implemented as a pilot project at the Air Cargo Complex in Delhi in 
1995. Automation was extended to more and more activities in a phased manner and the EDI system 
presently provides backward linkag es with airlines and shipping lines for online filing of manifests 
and forward linkages with banks and ports/ ai rports/ Inland Container Depots (ICDs) for the 
collection of customs duty/ release of cargo. The ED I facility has been extended to more locations in 
the country in a phased manner over the last 10 years, and at present, the facility is available at 37 
locations. These 37 Custom locations account for 85% of India’s international trade. Efforts are 
underway to upgrade the hardware and software capab ilities further in order to extend this facility to 
other Customs locations.    The EDI programme has been implemented indigenously without donor assistance.  
 
 Various challenges had to be faced in the pr ocess of implementation of the EDI system such 
as the need to amend the statutory framework and reengineer business processes to facilitate 
automation, integrate the EDI system with the syst ems of various community partners such as banks, 
airports/ ports/ICDs etc., training of officers and th e management of change. The technical aspects of 
the EDI programme such as development of softwa re and maintenance of hardware have been 
outsourced.  
 
 The Indian Customs Department is willing to provide technical assistance to Egyptian 
Customs if required in the process of automation of its Customs procedures.  
 
II- Page 37, III-Trade Policies And Practices By Measure, (2) Measures Directly Affecting 
Imports, (ii) Customs valuation and clearance, (b) Customs clearance, Paragraph 18, Regarding 
Risk Management  Question:   
In what cases (and products) does India apply q uality assessment, examination and post-clearance 
audit of bills of entry selected by the RMS? What are the procedures and how long do they take to 
implement?   
Reply:  All the bills of entry (import declarations) file d by importers or their agents are processed by 
the Risk Management System (RMS). Consignmen ts of importers, having a proven credibility and 
established compliance record, popularly known as A ccredited Clients, are offered upfront facilitation 
and their bills are normally not subjected to as sessment and examination. However, a small 
percentage of their consignments may be selected  for assessment and/ or examination randomly to WT/TPR/M/182/Add.1 
Page 310  
 
  measure continuing compliance levels. Bills of en try pertaining to non-accredited clients are not 
offered any upfront facilitation but are facilitated in terms of the degree of risk determined by the 
RMS. Such bills of entry may be given the treat ment of (a) no assessment and no examination, (b) 
assessment only (c) examination only or (d) both assessment and examination.    
 This segregation of consignments on the basi s of the perceived risk of the commodity, 
importer, agent, country of origin etc. as the case may be, are translated in to various Risk Rules, 
Interventions and Targets.  Sensitive commodities that  are prone to misdeclaration of quantity, value, 
description, country of origin etc are considered for this purpose. Those consignments pertaining to 
non-accredited importers that have not been interd icted by any rule, intervention and target are 
subjected to random selection for assessment or examin ation. Residual bills of entry that could not be 
segregated as potentially non-compliant by any of the features of the RMS are passively facilitated.    
  PCA (Post Clearance Audit) is done on bills of  entry randomly selected from the total bills of 
entry where the goods have been released. The selec tion criteria for audit are also prescribed in the 
system. 
 
Paragraph 19 (same section) states that “The RM S uses a valuation risk assessment module (VRAM) 
to use a weighted average value of rece nt like imports of sensitive goods. ”   
 Question: 
 
Egypt kindly requests more information on the VRAM applied by India?   
Reply:  The Directorate General of Valuation (DGoV) shares a list of sensitive commodities with the 
Risk Management Division (RMD) periodically . The information given to RMD includes 
classification of the item, its description, the bra nd etc along with the unit quantity (UQC), country of 
origin etc., besides the national weighted average value. A tolerance band is also prescribed. In any 
bill of entry, if the value declared in respect of any of the prescribed  items is less than that of the 
national weighted average value minus permitted to lerance, such consignments are automatically 
picked up for assessment and examin ation by the RMS to see as to whether there are  any apparent 
efforts to under value the commodities.  Paragraph 20 (same section) states that “The Appe llate Tribunal must reach a decision, where 
possible, within three years from the date on which an  appeal is filed. Data on the number of appeals 
were not provided.”   
Question: 
 Could India provide an approximate percentage of valuation decisions that are subject to appeal (this would help Egypt in evaluating the VRAM system)? Moreover, Is there any plan for reducing the time 
taken for appeal as it is one of the elemen ts required in facilitating procedures under Trade 
Facilitation negotiations. 
 Reply: The data on the number of customs appeals file d before Courts and th e Appellate Tribunal is 
as follows:-   WT/TPR/M/182/Add.1 
 Page 311 
 
 
  Sl.No. Appellate Forum Total No. of appeals as on 31.3.2007  
1. Supreme Court 479 
2. High Court 2,997 
3. CESTAT15 5,048 
 
As regards the information in respect of percenta ge of valuation decisions that are subject to 
appeal, it may be stated that out of the total number of appeals pending before the Supreme Court as 
shown above, approximately 50% rela te to classification and valuation issues.  The Indian Customs 
Act provides that the appeals arising out of the or ders of the Appellate Tr ibunal, relating to the 
determination of any question having a bearing on th e rate of duty or to the value of goods for the 
purposes of assessment may be directly agitated before the Supreme Court.  The limitation to file an appeal before the Tribunal is three months from th e date of receipt of the order and in the case of 
filing of appeals before the Supreme Court the time provided is two months from the date of receipt of 
the order.  Earlier the time limit provided to the De partment to file an appe al before the appellate 
Tribunal was one year and three months from the da te of the order of the original adjudicating 
authority.  However, with a view to streamline the litigation and facilitate quicker redress of disputes, 
the time limit granted to the Department has been ali gned with the time allowed to the other side.  The 
statute provides that the Appellate Tribunal shall, wh ere it is possible to do so, hear and decide every 
appeal within a period of three years from the date of  filing of the appeal.  It has also been provided 
that where an order of stay is granted in any app eal filed before the Appellate Tribunal, the case shall 
be disposed of by the Tribunal within a period of 180 days from the date of such order failing which 
the stay order shall stand vacated. 
Paragraph 20 (same section) also states that “An alternative channel for final resolution of 
assessment disputes, avoiding prolonged litigation,  has been created under the Customs and Central 
Excise Settlement Commission.” 
 Question:  Egypt kindly requests more details about the alter native channel for final resolution of assessment 
disputes, including the different steps involved ca ses where recourse to such  a channel is permitted, 
whether it can be used at the beginning of the process, etc? 
 
Reply:  (A) A Scheme of Advance Rulings has been se t up under the statute as an alternative channel 
for resolution of assessment disputes at the beginni ng of the process.  The Authority for Advance 
Rulings (Central Excise, Customs and Service Tax) is  headed by a Chairperson who is a retired Judge 
of the Supreme Court and comprises two Members.   (i) The following categories of applicants are en titled to apply for an Advance Ruling before the 
said authority:- 
  (a) a non-resident setting up a joint  venture in  India in collaboration with a non-resident 
or a resident; or  
 (b) a resident setting up a joint venture in I ndia in collaboration with a non-resident; or  
 (c) a wholly owned subsidiary Indian co mpany, of which the holding company is a 
foreign company, 
 (d) a resident falling within any such cla ss or category of persons, as the Central 
Government may, by notification in the O fficial Gazette, specify in this behalf, 
 
                                                     
 
 15 Customs, Excise and Service Tax Appellate Tribunal WT/TPR/M/182/Add.1 
Page 312  
 
  (ii) The question on which an Advance Ruling can be sought pertain to: 
 (a) classification of goods  (b) applicability of a notification under th e Act having a bearing on the rate of duty 
 (c) principles to be adopted for the purposes of determination of the value of goods under 
the provisions of the Act 
 (d) applicability of notifications issued in respect of duties as chargeable under the 
respective Acts and  
 (e) determination of the origin of goods.    (iii) The statute provides that the authority sh ould pronounce its Advance Ruling in writing within 
90 days of the receipt of the application a nd the Ruling is pronounced after following the 
principles of natural justice.  No ruling can be sought in respect of any matter which is 
already pending in the appellants case before  any officer of Customs or any appellate 
authority and also if the same matter has alread y been decided by the appellate authorities. 
 
(iv) The Advance Ruling pronounced by the authority shall be binding only on the applicant who 
had sought it and on the Customs/Central Excise authorities in respect of the applicant.  
 (B) Further, another alternative channel for final resolution of assessment disputes has been created 
under the statute by way of the Customs and Centra l Excise Settlement Commission.  The members of 
the Commission have to have special knowledge and experience in the administration of Customs and 
Central Excise laws.  Where a show cause noti ce demanding duty on account of mis- classification, 
under-valuation or inapplicability of exemption notif ication has been issued  to an assessee, he may 
apply before the Settlement Commission admitting his duty liability.  No application can be filed where the case has been adjudicated by the depart mental authorities and is pending with the appellate 
authorities.  The Settlement Commission issues orders  for the settlement of disputes after following 
the principles of natural justice and the said settleme nt order provides for terms of settlement by way 
of duty, penalty fine and interest.  The Commissi on has the power to grant immunity from prosecution 
and penalty under the Customs/Ce ntral Excise Acts. The orders passed by the Settlement Commission 
are conclusive with respect to the matter covered th erein.  It has been provided under the Act that an 
assessee can file a settlement application only once du ring his lifetime so as to ensure tax compliance 
and to avoid the scheme becoming a permanent amnesty scheme.   
 
 
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