US welcomes duty cut on alcohol

"We are studying India's announcement to withdraw the additional duty on imports of alcoholic beverages. Withdrawal of this duty would be a positive step in addressing the US concerns. What we are seeking is a level playing field, consistent with India's WTO commitments," US Trade Representative Susan C Schwab said in a statement on Friday.

Earlier on July 3, government of India announced the withdrawal of its additional duty on beer, wine and distilled spirits as well as an increase in the basic customs tariff on wine from 100 to 150 per cent.

The statement points out that on last June 20, a WTO dispute settlement panel was set up to consider the US claims that the additional duty and a separate extra additional duty result in customs duties on US imports of alcoholic beverages as well as other products that are in excess of India's WTO bound rates.

The additional duties have resulted in tariffs on alcoholic beverages ranging from approximately 150 to 550 per cent far in excess of India's WTO commitments, she noted.

"In the WTO, India committed that its bound tariffs on alcoholic beverages would not exceed 150 per cent," the statement said.

It is pointed out that between 2000 and 2005, the US exports of wine and spirits world-wide averaged approximately USD 630 million and USD 633 million respectively, making it the world's sixth largest exporter of wine and third largest exporter of spirits.