EU/INDIA: EU formally urges WTO action on Indian tariffs
The EU has formally asked the World Trade Organisation to set up an arbitration panel to rule on India's tariff regime for imported wines and spirits.
The EU's move comes after rounds of talks with the Indian government in recent months over the country's high duties.
European officials have long threatened to take India to WTO arbitration in a bid to force the country to change what is viewed as a "discriminatory" tax structure.
The EU, backed by the US and Australia, stepped up the pressure after India refused to reform the structure when it unveiled its annual Budget last month. Now, the EU has asked the WTO to consider its request at a meeting on 11 April.
EU Trade Commissioner Peter Mandelson said: "As we could not resolve our dispute in consultations, the EU sees no other way than to request the establishment of a WTO panel. We are of course not closing the door to an amicable solution - but the ball is now in India's court."
Indian distillers, however, have reportedly claimed the EU is being unfair in threatening WTO action in order to win equal treatment for imported spirits in India.
The All-India Distillers Association recently criticised the EU for its threats to take India to the WTO.
The report said the association accused the EU of "double-speak" because under EU law, Indian whisky made from molasses cannot use the word "whisky" on its products on sale in the EU. Any products on sale must be labelled with the term "spirit drink" or "Indian spirit drink".
The Scotch Whisky Association, however, argues that the EU regulations were in place "to avoid consumer confusion and unfair competition".
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