India Seeks WTO Consultations Over US Auto Tariffs

New Delhi, Jun 4 (KNN) India has formally requested consultations with the United States under the World Trade Organisation's safeguard agreement regarding American tariffs imposed on automotive components.

The request was submitted to the WTO on Tuesday as part of India's response to what it characterises as protectionist trade measures.

The dispute centres on tariff increases implemented by the United States on March 26, 2025.

The measures impose a 25 percent ad valorem tariff on imports of passenger vehicles and light trucks, as well as certain automobile parts originating from India.

While the vehicle tariffs took effect immediately, the tariffs on automobile parts became operational on May 3, 2025, with no specified end date.

In its communication to the WTO, India argued that the American measures constitute safeguard actions intended to shield the US domestic automotive industry from increased imports.

India contends that the United States failed to properly notify the WTO Committee on Safeguards before implementing these measures, as required under the Agreement on Safeguards.

The consultation request represents India's formal challenge to the tariffs within the WTO framework.

During these discussions, India aims to exchange views on the disputed measures and seek resolution through established trade dispute mechanisms.

India has indicated its expectation for a prompt response from the United States to arrange mutually acceptable dates and venues for the consultations.

This development follows India's recent decision to reserve the right to impose retaliatory duties on selected American products in response to US tariffs on steel and aluminium.

The escalating trade tensions reflect broader concerns about protectionist policies affecting global commerce.

The automotive parts sector represents a relatively modest portion of US imports in this category.

According to trade data, the United States imported approximately USD 89 billion worth of auto parts globally in the previous year. Mexico accounted for the largest share at USD 36 billion, followed by China at USD 10.1 billion, while India's contribution totalled USD 2.2 billion.

India has reserved all rights under the WTO agreement as it pursues this trade dispute through established multilateral channels.

The outcome of these consultations could influence broader US-India trade relations and set precedents for similar disputes involving safeguard measures.

(KNN Bureau)