Indicating a lukewarm response to the imposition of the Border Adjustment Tax (BAT) on steel imports as proposed by India’s Ministry of Steel, the finance ministry has sought exploration of alternative measures, a government official said on Tuesday, August 11.
The official said that the Ministry of Finance which had received the proposal for imposition of BAT on steel imports has asked its counterparts at the Ministry of Commerce to seek alternative measures like non-tariff barriers including minimum quality standards for imports and review and re-negotiations of existing Free Trade Agreements (FTAs) through which the bulk of steel imports were routed.
While no details are readily available on the basis for the finance ministry’s reluctance to impose BAT, the official said that member countries in the WTO have set upper limits on customs duties for products and any additional duties are frowned upon, and the Indian government is possibly unwilling to risk being dragged to international arbitration under the WTO in the event of additional duties being imposed on steel imports through BAT.