India's Commerce and Industry Ministry said the Arab Republic of Egypt withdrew the precautionary fee of 25% of CIF value imposed on imports of cotton yarn and fabric and sugar, effective April 8, 2009. The preventive fee was imposed as a temporary precautionary measure on January 16, 2009 for a period of one year. The minimum fee was half a dollar on every kg of cotton textile and one dollar for every kilo of processed sugar.

The Indian government challenged the preventive fee imposed by Arab Republic of Egypt, as Egypt has exceeded the bound rates notified to the World Trade Organization. The preventive fee was in addition to 5% import duty on cotton and mixed yarn and 10% import duty on cotton and mixed woven fabrics.

India ranks as the top exporter of cotton yarn. A fee of 25% of CIF value over and above all other taxes and duties imposed by Egypt would have adversely affected the country's textile export sector, which is already plagued by the economic meltdown.

The Arab Republic of Egypt withdrew the said fee, as a result of concerted efforts made by the Department of Commerce, Ministry of Textiles and other export promotion bodies,. India recognizes with deep appreciation, the action taken by Egypt.

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