Egypt withdraws fee of 25% of CIF value imposed on import of cotton yarn, cotton textiles

In January 2009 a temporary precautionary fee of 25% of CIF value was imposed by the Arab Republic of Egypt on imports of cotton yarn and fabric [HS Code 5205-5212] and sugar. The minimum fee was half a dollar on every kg of cotton textile and one dollar for every kilo of processed sugar. This fee was imposed as a temporary precautionary measure on 16th January, 2009 for a period of one year by decrees No. 19, 20 and 21 of the Minister of Trade & Industry of the Arab Republic of Egypt.

Immediately on receipt of this information, Government of India challenged the preventive fee imposed by Arab Republic of Egypt since Egypt has exceeded the bound rates notified to the World Trade Organization (WTO). Towards this end, Ministry of Commerce India took up the matter with Egyptian authorities on imposition of this fee amounting to 25% on CIF value of the goods which was in addition to 5% import duty on cotton and mixed yarn and 10% import duty on cotton and mixed woven fabrics.

Indian Cotton yarn exports to Egypt are a very significant component and rank 1st in Egypt's import of that commodity, besides being India's top exports to Egypt. A 'fee' of 25% 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.

As a result of concerted efforts made by the Department of Commerce, Ministry of Textiles and other export promotion bodies, the Arab Republic of Egypt has withdrawn the said fee vide Ministry of Trade & Industry Decree No. 336 of the year 2009 w.e.f. 8th April, 2009. India recognises with deep appreciation, the action taken by Egypt.