India challenges EU tariff relief to Pakistan

Asian Textile Business, Jun 2003

The Indian government has filed a complaint with the World Trade Organization (WTO) panel against European Commission (EC) facility of granting tariff preferences on textile products to Pakistan. The EC allowed tariff preferences on clothing to Pakistan in December 2001 under the EC Program of special arrangements to combat drug production and trafficking. The scheme is for three years, and is scheduled to be renewed by end of 2004.

This program has been a part of the EC General System of Preferences since 1990, and several Latin American countries have benefited from this scheme. Pakistan only started benefiting from this scheme from December of 2001.

India has been arguing that it was for political reasons relating to the September 11th incident and not for drug arrangements that Pakistan was given this benefit.

The Pakistan mission in the WTO will fight the case on the grounds that the issue is 11-12 years old. The WTO panel has six months to decide on India's complaint. The EU along with beneficiary countries including Pakistan have put up a joint defense.