Trump administration’s action will invite scrutiny on whether it is WTO compatible: Minister Prabhu

India will take up the issue of the U.S. imposing tariffs on steel and aluminium imports on a bilateral level, Commerce Minister Suresh Prabhu said on Tuesday.

“We are obviously not the largest exporter of steel or aluminium to the U.S.,” Mr. Prabhu said at a press conference following the conclusion of an informal mini-ministerial meeting of the WTO, which was attended by 53 countries.

“But still, as far as we are affected, we will definitely take it up with the U.S. with whom we have a huge trade surplus and we have a very good political relationship. We will take up this matter with them bilaterally.”

U.S. President Donald Trump recently announced a 25% import tariff on steel and a 10% tariff on aluminium.

“What the U.S. has raised, whether it is WTO compatible or not, whether it is violating some rules or not, is something the country will have to individually look into,” Mr. Prabhu added. “This is a unilateral action [by] the U.S., and any trade related action is subjected to scrutiny on whether it is WTO compatible or not.”

WTO Director General Roberto Azevedo also expressed his concerns about the actions taken by the US, warning that this could lead to escalation and retaliatory tariffs being imposed by other countries.

‘Potential for escalation’

“The WTO does not as an institution take a stance, but I have said publicly that I am very concerned [about the U.S.’ decision],” Mr. Azevedo said. “And I think the institution itself could say the same because such measures, for whatever reason, have a very real potential for escalation because of the possibility of responses from other partners with trade restrictive measures as well, and that is something we should avoid.”

“This is what we heard today, with many countries saying they are concerned by this and highlighting the potential for escalation,” he added. “We have to proceed very carefully and try to work within the framework of the WTO.” He also urged member countries to follow up verbal commitments to multilateral trade through action.

“Members committed to continuing negotiations on various issues including on the ones where we made no progress under the Doha round,” Mr. Azevedo said. “But… if we want to make progress in these vital issues, we need to face the problems that are before us.Just pledging support for the system is not enough. We need to match words with deeds.”

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