Even as trade talks at the World Trade Organisation are deadlocked due to the US refusing fresh cuts in its agricultural subsidies, India has indicated that it is willing to undertake duty cuts of up to 60 per cent on industrial goods.
This is conditional to the developed countries substantially reducing their agricultural subsidies.
"India is willing to accept a Swiss co-efficient of 20, which means duty cuts of up to 60 per cent on the present bound levels. These cuts would have to be enforced over a six-year period which would give our domestic industry sufficient time, since we are unilaterally also reducing our import duties to Asean levels," a top government official told Business Standard.
India, at present has bound duties averaging at around 34 per cent, compared with 30.8 per cent of Brazil, 3.9 per cent of European Union, 3.2 per cent of the United States, 2.3 per cent of Japan and 6.3 per cent of Singapore.
Member countries at the WTO are negotiating duty cuts on their bound levels which are usually higher than the actually applied rates. India had earlier offered duty cuts of 50 per cent on industrial goods.
Officials said most WTO members had in-principle agreed to a simple Swiss formula with two co-efficient -- one for the developed countries and another for developing countries -- as the basis to determine the duty cuts on industrial goods.
The co-efficient is inversely proportional to the duty cut. This means, higher the co-efficient, lower is the percentage of cuts, which a country has to undertake. In the run-up to the Hong Kong ministerial, the EU was keen to have a single co-efficient while the US had agreed to have two co-efficient but wanted the gap between the two to be less.
"There is a strong likelihood that developed countries would agree to a co-efficient of less than 10 while developing countries would converge at around 25," an official said.
However, the issue of duty cuts on industrial goods is completely contingent on progress in agriculture,' an official said.
The WTO Director General Pascal Lamy met trade ministers of key countries including India to understand their individual positions. Lamy has been specially invited to attend the G-8 meeting in St Petersberg next week which is also expected to deliberate on the deadlock in trade talks.
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