India charges one of the highest duties on medicines, ventilators, oxygen masks, reagents: WTO

NEW DELHI: India imposes one of the highest duties on import of various medical products including medicines, ventilators, oxygen masks and reagents, the World Trade Organization (WTO) said in a report.

“Among Asian economies, India’s duty for respirators is 10% while for China, the rate is 4%,” the multilateral trade watchdog said in a report on worldwide trade in COVID-19 medical products.

Respirators or ventilators, which are in shortage in the current health crisis, are not covered under the Information Technology Agreement. The report comes at a time when India has floated a tender to procure 10,000 ventilators in a move to tide over a shortage of this vital device.

As per the report, 67 members provide duty-free treatment to respirators or ventilators, including the EU, US, Republic of Korea, and Switzerland. The report traces trade flows for products such as personal protective products, hospital and laboratory supplies, medicines and medical technology while providing information on their respective tariffs.

These COVID-19 relevant medical products are categorized into four main groups- medicines or pharmaceuticals including both dosified and bulk medicines; medical supplies which refer to consumables for hospital and laboratory use such as alcohol, syringes, gauze and reagents; medical equipment and technology such as microscopes, ultrasonic scanners, respirators or ventilators; and personal protective products which include hand soap and sanitizer, face masks, protective spectacles.

Actual tariff

The average Most-favoured-nation (MFN) applied tariff on COVID-19 relevant medical products for WTO Members is around 4.8%, which is lower compared to average applied tariff for all non-agricultural products, which is 7.6%. However, India imposes an 11.6% duty. Applied tariffs are the actual duties that countries levy on imports.

Among all medical products, the average MFN applied tariff on medicines is the lowest at 2.1% and the highest in personal protective products at 11.5%. In India’s case, these levies are 10% and 12%, respectively.

Imports and exports of medical products totalled about $2 trillion, including intra-EU trade, which represented approximately 5% of total world merchandise trade in 2019. Trade of products described as critical and in severe shortage in COVID-19 crisis totalled about $597 billion, or 1.7% of total world trade in 2019, according to WTO.

Imports of medical supplies are taxed on an average of 6.2% compared to 15% duty charged by India. As for medical equipment, the global applied tariff is 3.4%.

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