While India has imposed the duties as a tit-for-tat move against the US decision to impose unilateral additional tariffs on steel and aluminium imported from the country last year, Washington claims that the tariffs flout WTO rules.
“The US claims that the additional duties, which India imposed through a series of notifications issued between June 2018 and June 2019, are inconsistent with provisions of the WTO’s General Agreement on Tariffs and Trade by unfairly discriminating against US imports vis-à-vis those from other WTO members and by according less favourable treatment to US goods than that provided for in India’s schedule of concessions,” according to an official release. India’s argument in support of its duties is that retaliation is permitted under the WTO’s Agreement on Safeguards.
But the US maintains that its tariffs are not a safeguard measure but were taken under Section 232 of the US Trade Expansion Act of 1962 on grounds of national security.
If the dispute consultations between the two countries fail to resolve the matter the US can ask the WTO to set up a panel to decide on the matter.