WORLD TRADE  
ORGANIZATION   
G/LIC/Q/IND/20 
11 May 2012 
 (12-2560) 
Committee on Import Licensing Original:   English 
  
 
IMPORT LICENSING SYSTEM OF INDIA 
 
Follow-up questions to India on the import licensing and quota system for marble and 
similar stones from Turkey1 
 
 
The following communication, dated 10 May 2012, is being circulated at the request of the 
delegation of Turkey. 
 
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As a country endowed with 40 per cent of the world's natural stone reserves and 3,8 billion 
cubic meters of extractible marble, Turkey has subs tantial interest in the exports of natural stones. 
 With its share of 2.8 per cent in Turkey's e xports of natural stones and 5 per cent of rough 
marble blocks in 2010, India is a major trading partner of Turkey. 
 
Thus, regulations and re gulatory practices by India in this sector are carefully monitored by 
our exporters and by the Turkish Government.  
 Turkish private sector is very much concerned by the import licensing and quota system and 
the Ministry of Economy receives complaints on India's regime frequently.  
 
 As a result, Turkey attempted to discuss this  issue thoroughly not only on bilateral terms, 
through contacts with Indian Ministry and India' s Mission in Geneva; but also in the World Trade 
Organization, by bringing the issue to the agenda of the Import Licensing Committee Meeting on 
14
th of October, last year.  Turk ey tabled questions regarding th e scope, rationale and procedural 
aspects of the said system with the WTO Document G/LIC/Q/IND/17, to which India responded with 
the WTO document G/LIC/Q/IND/18 . 
 
Through the document G/LIC/Q/IND/17, Turkey specifically questioned:  
 
1. Which products are subject to the impor t licensing regime? (as DGFT Notification No.64 
dated 4 August 2011 refers only to products covered under HS Code No. 25151100 and 25151200).  
 In its reply, India stated that other products under the two other HS Codes (25151220 and 
25151290) were also restricted for imports; but did not specify the exact regulation.  
 
We are still in need of the exact reference to the legislation regulating the import of products 
covered under HS Code No. 25151220 and 25151290. 
 
                                                      
1 See also documents G/LIC/Q/IND/17 and G/LIC/Q/ IND/18 containing respectively the first set of 
questions and responses. G/LIC/Q/IND/20 
Page 2  
 
  2.  How the restriction on imports of marble  and similar stones woul d alleviate concerns 
regarding "safety, security and the environment"?  
 In its reply, India referred to the environmental effects of processing of marble blocks.  India 
also stated that marble mining on the one hand and cutting and further processing of marble blocks on 
the other have an equal effect on environment. 
  We wonder if there is any scientific study that can  be cited by India indicating that the marble 
processing and marble mining have hazardous effect on the environment and that they are similar. 
 
Moreover, in 2010, India expor ted around 1 million tons of processed granites, ranking the 
second among processed granite exporting countries.  We believe that the "potential" effects, if any, 
of marble and granite processing to the health and environment are the same.  
 Thus, we wonder how India regulates granite processing regarding safety, security and the 
environment concerns.  
 
3.  Why is the eligibility criterion restricted in th e manner set out in the relevant Notification, i.e. 
five years long operation?  
 India answered by stating that the eligib ility criterion changed with DGFT Notification 
No. 64.  After an examination of the said Notifica tion however, we still observe that the 5 years long 
operation requirement is still there with some additional eligibility requirements. 
 India also stated that the reason for the above -mentioned requirement is the aim to ensure 
adequate manufacturing capacity.  This, however, stands  in contradiction to the Article 3(5)j of the 
Import Licensing Procedures Agreement which states "Consideration shall be given to ensuring a 
reasonable distribution of licenses to new importers…".  
 
4.  Why India imposes a ceiling level of 300.000 metric tons?  
 India replied by stating that the ceiling for imports is now 500.000 metric tons.  This, 
however, does not change the fact that India's impor t licensing system is still a quantitative restriction 
as it has restrictive effect on importation.  
 Moreover, in its reply to Turkey's question rega rding the eligibility of units that may make 
applications for import licenses, India replied by sta ting that the said criteria was intended to ensure 
adequate and sustainable manufacturing capacity.  T hus, we wonder if India has data regarding its 
domestic marble cutting and processing capacity.  If the answer is yes, we would like to know if the 
ceiling for imports of 500.000 metr ic tons enough for total capacity of India for marble cutting and 
processing. 
 It is to our belief that the quota determined is  still very restrictive, far away from meeting 
market demands in India. 
 
5.  If the floor price is a license fee.  
 India replied by stating that it is the minimu m import price to ensure quality of goods under 
import.  As is well known, the price of marble may depend on the variables on the supply and demand 
side.  Moreover, as the price of marble fluctuates within the year depending on market conditions, the 
price determined by India for the whole year mak es the link between price and quality, as stated by 
India, rather arbitrary.  
  G/LIC/Q/IND/20 
 Page 3 
 
 
  We thus request India to explain the rationale behind its import pricing policy. On what basis 
can India argue that the floor price set fo r the importation of marble ensures quality?  
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