As per WTO rules, the panels report will be adopted by the dispute settlement body (DSB) unless a party to the dispute decides to appeal the report or DSB decides, by consensus, not to adopt the report.
The panel was set up at New Delhis request to decide whether the anti-dumping duty suspended by EU from August 14, 2001 be rolled back or not. The panel met in Geneva on November 1, 2002 and in its preliminary report gave its ruling against New Delhi. Its final report, which came out later, had reiterated its preliminary findings.
Prior to this, New Delhi had challenged the anti-dumping duty at the WTOs dispute settlement mechanism and on March 1 last year, DSB and the appellate body in their reports concluded that imposition of the duty was inconsistent with the anti-dumping agreement. The DSB requested the European Commission (EC) to bring its measure in conformity with its obligation under this agreement.
Thereafter, EC had undertaken a review of the anti-dumping measure and re-determined the level of duty while keeping the duty suspended. New Delhi had strongly opposed this and at its request a compliance panel was set up.
The textiles dispute with EU dates back to September 1996 when EC had initiated anti-dumping investigations into certain imports of cotton-type bed linen from India and some other countries. Then, DSB had maintained that there were inconsistencies in EUs calculations of anti-dumping duties.
Subsequently, the duties were revised downwards by EU. In the case of India, the duties were suspended on August 14, 2001.
The other Indian textile products which have been subject to anti-dumping/anti-subsidy investigations from EU are polyester staple fibre (PSF) and polyester texturised yarn (PTY). In the case of PSF, the domestic manufacturers are reluctant to go for an appeal in the WTO Appellate Body through the Silk & Rayon Export promotion Council which is co-ordinating the defence of the case. In regard to PTY, a unanimous view is yet to emerge among local manufacturers about the future course of action.