India and the European Union have again asked the WTO’s dispute settlement body not to adopt a ruling against New Delhi’s import duties on certain information and technology products till December 18 as both sides are engaged in bilateral talks to resolve the matter.

Earlier, the two regions sought time till September 19 by making a similar request in June. The WTO’s dispute settlement body (DSB) will meet on September 19 in which it would consider adopting a draft decision shared by India and the European Union (EU).

"We consider that the draft DSB decision, if adopted, would facilitate the resolution of the dispute," according to a communication of the World Trade Organisation (WTO).

For that meeting, they urged the DSB not to adopt the WTO’s dispute settlement panel’s ruling of April 17, which stated that India’s import duties on certain information and technology products are inconsistent with the global trade norms.

As per the rules of the WTO, the panel’s ruling will have to be adopted by the DSB for implementation within 60 days of the release of the order. However, the complainant and defendant can mutually request for deferment of adoption of the ruling. According to the draft decision submitted by the two regions for the body: "The DSB agrees that, upon a request by the European Union or India, the DSB shall no later than 18 December 2023 adopt the report of the panel in the dispute India – Tariff Treatment on Certain Goods in the Information and Communications Technology Sector of 17 April 2023".

The development assumes significance as India and the EU are negotiating a free trade agreement. So far, four rounds of talks have happened.

In its report, the dispute panel of WTO on April 17 said that import duties imposed by India on certain information and technology products violate global trading norms.

The ruling followed a dispute filed by the EU, Japan and Taiwan against these duties in WTO.

On April 2, 2019, the EU challenged the introduction of import duties by India on a wide range of ICT products, for instance, mobile phones and components, base stations, integrated circuits and optical instruments.

The EU had claimed that the measures appear to be inconsistent with certain provisions of WTO. Later, Chinese Taipei and Japan also joined the dispute.

According to WTO rules, a member country can file a case in the Geneva-based multilateral body if they feel that a particular trade measure is against the norms of WTO.

Bilateral consultation is the first step to resolving a dispute. If both sides are not able to resolve the matter through consultation, either of them can approach the establishment of a dispute settlement panel.

The panel’s ruling or report can be challenged at WTO’s appellate body.

Interestingly, the appellate body is not functioning because of differences among member countries in appointing its members. Several disputes are already pending with this body. The US has been blocking the appointment of the members.