India has sought six years time to phase out import curbs in tune with its WTO commitments, but US has objected to this timeframe. Hearing the two sides, a dispute settlement panel (DSP) of WTO has asked the two countries to settle the issue through mutual understanding. The interim findings of DSP on a complaint filed by the US was issued here this weekend. India had entered into bilateral agreements regarding the six year timeframe with five trading partners, including the European union, on the grounds that it was not possible for New Delhi to lift the curbs earlier due to balance of payments (BoP) position.

The DSP ruling also provided for arbitration by a designated authority to settle the issue and the final findings are expected to be available in two weeks time.

The US had dragged Indiato the WTO after bilateral talks to solve the issue failed. Earlier, India had successfully negotiated the six-year phase-out period with Australia, Canada, New Zealand and Japan besides the European Union. WTO experts feel the issue has gone back to the situation from where the controversy sparked off.

"It (import curb row) is back to where it was," an expert, who did not wish to be identified, said.

India came under pressure to dismantle its import curbs, imposed to preserve its foreign exchange reserve, after the International Monetary Fund (IMF) reported that India's balance of payment position was satisfactory.