In June 2023, a decision was reached to settle six ongoing World Trade Organization (WTO) disputes between the United States and India through mutually agreed solutions. As a result of this decision, India has revoked additional tariffs on eight products of U.S. origin, including apples, walnuts, and almonds, as specified in Customs Notification No. 53/2023.
The Central Government has provided clarification, stating that there is no adverse effect on the economy. Minister of Commerce and Industry, Piyush Goyal, emphasised that only the additional 20% has been eliminated. The Most Favoured Nation (MFN) duty of 50% and 100% to US apples and walnuts respectively will be continued.
In 2019, India imposed extra charges of 20% on both apples and walnuts, as well as an additional fee of Rs 20 per kilogram on almonds, in response to protectionist measures taken by the US, which raised tariffs on certain steel and aluminium products.
These supplementary levies on American goods have now been lifted, as the US has agreed to grant market access to steel and aluminium products through the exclusion process. It’s important to note that the Most Favoured Nation (MFN) duties on apples, walnuts, and almonds remain unchanged, with rates of 50%, 100%, and Rs 100 per kilogram, respectively, applying to all imported products, including those of US origin.
In addition, the Directorate General of Foreign Trade (DGFT) introduced a change in the import policy for Apples under ITC (HS) 08081000 through Notification No. 05/2023 dated May 8, 2023. This amendment establishes a Minimum Import Price (MIP) of Rs 50 per kilogram for apple imports from all nations, except Bhutan.
Consequently, this MIP will be applicable to apples from the United States and other countries, with the exception of Bhutan. This step is aimed at safeguarding against the influx of low-quality apples and preventing predatory pricing in the Indian market.
Read More: DGFT notifies Amendment in Import Policy Condition of Apples
This action will have no adverse consequences for domestic apple, walnut, and almond producers. Instead, it will foster competition in the premium market category for apples, walnuts, and almonds, leading to improved quality and competitive pricing for Indian consumers. Consequently, U.S. apples, walnuts, and almonds will be on an equal footing with products from other countries.
Due to the implementation of retaliatory levies on American apple and walnut imports, the market presence of U.S. apples has decreased. As a result, there has been a noticeable increase in apple imports from other countries, going from US$ 160 million in FY 2018–19 to US$ 290 million in FY 2022–23.
Turkey, Italy, Chile, Iran, New Zealand, and other nations have emerged as significant apple exporters to India, thus displacing the U.S. in terms of market share. Similar to how imports of walnuts increased from US$ 35.11 million in FY 2018–19 to US$ 53.95 million in FY 2022–23, Chile and the UAE overtook other countries as India’s top suppliers.
Almond imports have reached almost 233 thousand metric tonnes over the last three years, while domestic production has remained at about 11,000 metric tonnes, demonstrating India’s strong reliance on imports. Therefore, the removal of extra taxes will encourage fair competition among nations selling these goods to India.
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