The panel considers this period is be a resonable period of time for India to bring about conformity with the obligations under WTO agrement.

This, analysts say, is a "positive" aspect to the panel's recomnmendations. For, even while concluding that quantitative restrictions on imports applied by India are not"justified" by Article XVIII-B, the panel is understood to have conceded that a member-country of the WTO should have a "reasonable period of time to comply with the obligations under the WTO agrement".

The panel iss also belileved to have noted that the process of trade liberalisation is often "fragile", and can be interrupted by balance of payments problems, even when such problems are not attributable to trade liberalisation.

Further, this fragilityjustifies an implementation period which is attuned to sustaining support for liberalisation in the presence of external shocks and to the internal adjustment process.

It is also believed to have acknowledged the point that while the Dispute Settlement Understanding (DSU) of the Uruguay Round Agreement provides for prompt compliance with the recommendations of the Dispute Settlement Body repeat Body (DSP) of the WTO, there is a possibility that it might be "impractical" for a member to comply immediately in whch case"the member" shall have a reasonable period of time in which to do so (Article 21, 3c.

India has urged that it is entitled to a phase-out period for removal of quantiative restrictions on imports and that it should not be required to eliminate them immediately.

In fact, the disagreement with the US was over "the length of the phase-out proposed by India and not a disagreement over whether a phase-out would be appropriate".

The panel is also believed to have suggested that the parties (USand India) negotiate an implementation phase-out period and should it be impossible to do so, a reasonable period of time be set in view of the considerations outlined above.

It may be noted that the panel report is only an interim one and is treated as confidential till it is finalised for adoption.

Under Article XVIII-B of GATT, India maintains quantitative restrictions on imports of various items. The WTO committee on balance of payments restrictions at its meeting in January 1997 invited India to present a phase-out plan for elimination of these restrictions over a period of time.

Accordingly, India presented a plan for removal of QRs over a period of 9 years in May 1997 . While the plan received the support of the developing countries at the consultations held in June-July 1997, the developed countries expressed the view that the phase-out period was too long and that a number of items for phase-out during the later years of the plan were too many.

In an attempt to resolve the issue, India agreedto reduce the phase-out period to 7 years with very few items in the seventh year. Even this was not acceptable to the developed countries. Subsequently, the US, EU, Canada, Australia, New Zealand and Switzerland initiated dispute settlement proceedings against India and sought consultations under Article XXII of GATT.

In the subsequent consultations, India reached an agreement with all countries except the US. The US filed a dispute against India and subsequently a panel was established under the WTO dispute settlement procedure.