India raises concerns over Indonesian cotton yarn duties, seeks WTO dialogue

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India has initiated discussions with Indonesia at the World Trade Organization (WTO) regarding Indonesia’s safeguard measures on cotton yarn imports. Although the two countries are not formally engaged in a WTO dispute, both agreed to hold consultations to facilitate dialogue and exchange information on the issue.

Indonesia has defended the extension of its safeguard measures by citing ‘unforeseen developments,’ specifically a rise in global exports of Indian cotton yarn. This increase has led to a ‘significant increase’ in shipments to Indonesia. Currently, about 11.85 per cent of Indonesia’s cotton yarn imports originate from India, marking a substantial trade interest for India’s textile sector.

As an impacted party, India is using the WTO’s Agreement on Safeguards to raise concerns about the transparency and fairness of Indonesia’s safeguard review process. India has formally proposed virtual consultations to take place between June 10 and June 13, 2025, or at another mutually convenient time.

This move suggests India’s intention to adopt a more proactive stance in safeguarding its textile exports amid rising global protectionism. Cotton yarn, an important competitive product for India, is increasingly facing trade barriers worldwide, and the WTO consultations reflect India’s efforts to address such challenges diplomatically while seeking greater clarity and fairness in international trade practices.