Egypt withdraws 25-per cent duty on Indian cotton, sugar

Egypt has withdrawn a temporary levy of 25 per cent of CIF value, imposed in January 2009, on imports of cotton yarn and fabric and sugar, an Indian government release said quoting a statement issued by the ministry of trade and industry of the Arab Republic of Egypt.

The minimum fee was half a dollar on every kg of cotton textile and one dollar for every kg of processed sugar. This fee was imposed as a temporary precautionary measure on 16 January 2009 for a period of one year.

The Government of India had challenged the preventive levy imposed by Egypt since it had exceeded the bound rates notified to the World Trade Organisation (WTO).

The commerce ministry had taken up the matter with Egyptian authorities on imposition of the fee amounting to 25 per cent of CIF value of the goods, which was in addition to the 5 per cent import duty on cotton and mixed yarn and 10 per cent import duty on cotton and mixed woven fabrics.

Indian cotton yarn exports to Egypt are a very significant component and rank first in Egypt's import of that commodity, besides being India's top exports to Egypt. A 'fee' of 25 per cent of CIF value over and above all other taxes and duties imposed by Egypt would have adversely affected our textile export sector which is already plagued by the economic meltdown, a government release said.

Egypt has withdrawn the fee with effect from 8 April 2009 and the Indian government said it appreciated the action taken by Egypt.