What is WTO IT Agreement?

Subject: IR/Economy

Context:

Japan and Chinese Taipei is planning to set up a dispute settlement panel at the World Trade Organization (WTO) against New Delhi’s customs duties on imports of certain information and communications technology (ICT) products.

Concept:

• Both alleged that imposition of import duties on certain electronic products by India infringes WTO norms as India has committed zero per cent bound tariffs on these products. India has strongly opposed these allegations.
• Bound tariffs or duties refer to the ceiling over which a WTO member country cannot impose import duty, the applied tariff is the duty which is currently in place.
• India has stated that these ICT products are part of WTO’s Information Technology Products (ITA-2) agreement, and New Delhi is not part of this pact.
• India is a part of ITA-1, signed in 1997, in which it did not contain any obligation to eliminate customs duties on these products.

ITA

• The Information Technology Agreement (ITA) was concluded by 29 participants at the Singapore Ministerial Conference in December 1996.
• Since then, the number of participants has grown to 82, representing about 97 per cent of world trade in IT products.
• The ITA covers a large number of high technology products, including computers, telecommunication equipment, semiconductors, semiconductor manufacturing and testing equipment, software, scientific instruments, as well as most of the parts and accessories of these products.
• The participants are committed to completely eliminating tariffs on IT products covered by the Agreement.

ITA2

• In June 2012, the ITA-2 negotiation was launched in order to both expand the coverage of ICT products and address classification issues.
• At the Nairobi Ministerial Conference in December 2015, over 50 members concluded the expansion of the Agreement, which now covers an additional 201 products valued at over $1.3 trillion per year.