Brussels, July 4 - The European Union welcomed India's withdrawal of an extra customs duty on imported wines and spirits, but said it was too soon to say whether World Trade Organisation action over the case would be scrapped.
The EU and the United States have pressed India to cut its additional wines and spirits duties, which Brussels says go as high as 550 percent for spirits and 264 percent for wines.
India's government said on Tuesday it would withdraw the additional duty.
"The reported removal of the discriminatory duties is good news for European spirit and wine makers, who have been badly disadvantaged by Indian measures for many years," an EU official said on Wednesday.
"We have to study in detail the Indian action, so it is a bit premature to speak about the suspension of the panel procedure at this point," the official said.
The EU kicked off action against India at the WTO in December last year and escalated it in March by seeking a dispute resolution panel at the Geneva-based arbiter of global trade rows.
The EU official said Brussels regretted a move also announced by India on Tuesday to raise its basic customs duty on wines by half to 150 percent, the same level as for spirits.
EU Trade Commissioner Peter Mandelson has previously said he will take a tougher approach to fighting barriers to European exports around the world.