India hits US, hikes import duty on 29 products: Here's the list

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New Delhi : In an attempt to hit the United States, India has increased customs duty on 29 products, including pulses and iron and steel products, imported from the US as a disciplinary action against the tax hike by Washington. 

Sources confirmed that the duty hike would soon come into effect for 28 products. Meanwhile for artemia, a kind of shrimp, the rate hike would be effective from August 4, the finance ministry said in a notification.

The United States has adopted protectionist policies and hiked import duties. Also, the European Union has decided to levy higher import duties on a variety of US products and a similar action is being considered by China. It is likely that a trade war like situation has begun

According to the notification by finance ministry, the import duty on chickpeas, Bengal gram (chana) and masur dal has been increased to 70 per cent from 30 per cent earlier, while that on lentils has been hiked to 40 per cent from 30 per cent.

Shelled almonds imported from the US will now demand import duty at Rs 120/kg as against Rs 100/kg earlier. Almonds in shell will attract import duty at the rate of Rs 42/kg as against Rs 35/kg.

Import duty on walnut in shell will attract customs duty at the rate of 120 per cent as against 30 per cent earlier. Apples will attract import duty of 75 per cent as against 50 per cent earlier.

The tax on boric acid has been hiked to 17.50 per cent, while the same on phosphoric acid has been raised to 20 per cent from 10 per cent each earlier.

Import duty on diagnostic reagents has been doubled to 20 per cent, while binders for foundry moulds have been hiked to 17.5 per cent.

Flat rolled products on iron has been raised to 27.50 per cent from 15 per cent earlier, while certain flat rolled products on stainless steel would now attract 22.50 per cent duty as against 15 per cent earlier.

Duty on artemia, a kind of shrimp, has been increased to 30 per cent with effect from August 4.

Last week, India had submitted a list of 30 items World Trade Organization on which it proposed to raise customs duty by up to 50 per cent.

In the notification, there is no mention of duty hike on motor cycle with engine capacity of over 800cc.

As per India report submitted to the WTO, it had wished for to hike customs duty on specified motorcycles, which primarily include Harley Davidson and Triumph, to 50 per cent.

For automobiles and earth moving equipment, SIM socket/other mechanical items (metal) for use in manufacture of cellular mobile phones, the duty has been hiked to 25 per cent from 15 per cent earlier.

Deloitte India Partner M S Mani said that on several products such as pulses the increase is very sharp (30 per cent to 70 per cent), while for iron and steel products, the increase is at least 50 per cent of the existing rate (from 15 to upwards of 22.5 per cent).

"The increase in the customs duties on goods originating from the USA was expected, but the magnitude of the increases would have been unexpected. These increases would make the domestic products cheaper compared to imports and lead to domestic manufacturing/demand pick-ups as a corollary," Mani said.

The decision to hike duties is in revenge to the one-sided enhancement in tariff by the US on certain steel and aluminium products earlier this year which had tariff implication of $241 million on India.

The duty hike by India would have an equivalent tariff suggestion for the US.

On March 9, US President Donald Trump forced heavy tariffs on imported steel and aluminium items, a step that has provoked global trade war.

Officials in India mentioned that the duty imposed by the US has affected steel exports by $198.6 million and aluminium shipments by $42.4 million.

India has also pulled the US to the World Trade Organisation's (WTO) dispute settlement mechanism over the imposition of import duties on steel and aluminium. India exports steel and aluminium products worth about $1.5 billion to the US every year.