US flags Brazil’s preferential tariff treatment for India in Section 301 probe, no action against New Delhi

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Washington DC: Senior White House officials have informed that the office of the United States Trade Representative (USTR), while announcing a 25 per cent tariff on certain Brazilian imports under a Section 301 investigation, cited Brazil’s preferential tariff arrangements with India and Mexico as one of the practices disadvantaging American exporters.

The tariffs are scheduled to take effect on July 22. Senior White House officials stated that the investigation found that Brazil grants tariff concessions to India and Mexico that are not extended to the United States.

According to the White House officials, the US in the course of its investigation had identified that Brazil provides unfair preferential tariffs to India and Mexico for a number of different tariff lines. The investigation claimed that Brazil offered a certain selection of tariff relief to Mexico and India, and they do not offer the same preferential access to American workers and producers.

Officials argued that the differential treatment has affected US exports to Brazil. Officials stated that as a result of this policy of a preferential arrangement over a subset of goods, US exports to Brazil have gone down while exports from those other countries had gone up. White House officials further stated that there was a clear correlation between this practice and what happened to US exports.

White House officials stated that the US expects that Brazil extend this type of preferential tariff treatment to them as well. Officials argued that the US is a big trading partner for Brazil and wants to compete on the best of terms like some of the other countries. According to White House officials the preferential arrangements cover multiple sectors.

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The US officials say that Brazil’s bilateral preferential trade agreements with India and Mexico provides producers from those countries lower tariff rates than those applied to US exports.

The concessions span agricultural products, motor vehicles and auto parts, minerals, chemicals and machinery. According to White House officials the preferential treatment covers “hundreds of tariff lines for India” and “over 1,000 tariff lines for Mexico,” with tariff rates ranging from 10 to 100 per cent below Brazil’s most-favoured-nation tariffs applicable to US goods.

The remarks came as the USTR announced a 25 per cent tariff on certain Brazilian goods following its Section 301 investigation into what it described as unfair Brazilian trade practices, including digital trade barriers, electronic payment services, anti-corruption enforcement, intellectual property protection, ethanol market access and illegal deforestation.

(ANI)

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