High Tariffs Back in Global Trade Debate: Sources

New Delhi, Apr 19 (PTI) Imposition of high tariffs to protect domestic industries, once criticised by developed nations, is back in global trade and the rationale for levying such duties, which was earlier championed by developing countries, is also making a comeback in trade talks, sources said.

Without naming countries like the US, they also said that now the advanced economies are also talking about protecting livelihood of fishermen and farmers.

Now, the whole concept that livelihood fishing and farming are different from commercial activities is making a comeback. The same principles once raised by developing countries - previously dismissed - are now resurfacing in global discussions, they added.

"Developed countries are using tariffs which they had left during GATT (General Agreement on Tariffs and Trade) to come back and say that tariffs are necessary for protection. We have been arguing about this when we gave the infant industry argument that developing countries' industries require some kind of tariff protection, the whole world went against this and they stated that your tariffs are very, very high and now the same sectoral tariffs are being used," one of the sources said.

The US imposed sweeping tariffs on April 2 which were later suspended for 90-days except on China, which is facing 245 per cent duty. The US has imposed 25 per cent duty on steel, aluminium and auto components.

These duties on steel or aluminum or auto components are being imposed to create a tariff wall and to protect those segments.

"So whether a tariff is good or bad, will depend upon what is the stage of your development," they said adding the way free trade agreements are now negotiated has also changed, as rich nations are pushing for non-trade issues in such pacts.

It is the world which does not believe in principles of special and differential treatment (SDT), common but differentiated responsibilities (CBDR) and duty free tariff preferences (DFTP) for least developed nations.

"Now the rules of the game have completely changed," they said.