New Delhi : The US has dragged India to the WTO’s dispute settlement mechanism over export subsidies, saying these incentives were harming US companies, prompting the government to state that it would engage with the Trump administration and explain its position.

The US on Wednesday challenged India’s export subsidy programmes such as Merchandise Exports from India Scheme in the World Trade Organisation, asserting that these initiatives harm its companies by creating an uneven playing field. They have sought consultations with India under the aegis of the global trade body’s dispute settlement mechanism.

“The US has asked for a consultation process, we will engage fully in the process and we would make sure that we make our position known to the US. We expect that they would also engage with a positive spirit with an effort to resolve a dispute with a friendly country,” Commerce Secretary Rita Teaotia told reporters here.

Trade deficit narrows

India’s trade deficit in February narrowed to $12 billion from an over a four-year high of $16.3 billion in the previous month, as exports picked up while imports moderated. Exports grew by 4.5 per cent in February to $25.8 billion, Teaotia said.

Imports too rose by 10.4 per cent to $37.8 billion during the last month.

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