diff --git a/idea/src/org/jetbrains/kotlin/idea/codeInliner/CodeToInlineBuilder.kt b/idea/src/org/jetbrains/kotlin/idea/codeInliner/CodeToInlineBuilder.kt
index 65774e8c721..549bf7d2f31 100644
--- a/idea/src/org/jetbrains/kotlin/idea/codeInliner/CodeToInlineBuilder.kt
+++ b/idea/src/org/jetbrains/kotlin/idea/codeInliner/CodeToInlineBuilder.kt
@@ -25,6 +25,8 @@ import org.jetbrains.kotlin.idea.core.asExpression
 import org.jetbrains.kotlin.idea.imports.importableFqName
 import org.jetbrains.kotlin.idea.intentions.InsertExplicitTypeArgumentsIntention
 import org.jetbrains.kotlin.idea.intentions.SpecifyExplicitLambdaSignatureIntention
+import org.jetbrains.kotlin.idea.refactoring.addTypeArgumentsIfNeeded
+import org.jetbrains.kotlin.idea.refactoring.getQualifiedTypeArgumentList
 import org.jetbrains.kotlin.idea.references.canBeResolvedViaImport
 import org.jetbrains.kotlin.idea.references.mainReference
 import org.jetbrains.kotlin.idea.resolve.ResolutionFacade
@@ -57,15 +59,13 @@ class CodeToInlineBuilder(
             analyze: () -> BindingContext,
             importFqNames: Collection<FqName> = emptyList()
     ): CodeToInline {
-        var bindingContext = analyze()
+        val bindingContext = analyze()
 
         val codeToInline = MutableCodeToInline(mainExpression, statementsBefore.toMutableList(), importFqNames.toMutableSet())
 
-        bindingContext = insertExplicitTypeArguments(codeToInline, bindingContext, analyze)
-
         insertExplicitReceivers(codeToInline, bindingContext)
 
-        if (mainExpression != null) {
+        if (mainExpression != null && mainExpression in codeToInline) {
             val functionLiteralExpression = mainExpression.unpackFunctionLiteral(true)
             if (functionLiteralExpression != null) {
                 val functionLiteralParameterTypes = getParametersForFunctionLiteral(functionLiteralExpression, bindingContext)
@@ -75,8 +75,15 @@ class CodeToInlineBuilder(
                     }
                 }
             }
+            val typeArgumentsForCall = getQualifiedTypeArgumentList(mainExpression, bindingContext)
+            if (typeArgumentsForCall != null) {
+                codeToInline.addPostInsertionAction(mainExpression) { inlinedExpression ->
+                    addTypeArgumentsIfNeeded(inlinedExpression, typeArgumentsForCall)
+                }
+            }
         }
 
+
         return codeToInline.toNonMutable()
     }
 
@@ -117,24 +124,6 @@ class CodeToInlineBuilder(
         }
     }
 
-    private fun insertExplicitTypeArguments(codeToInline: MutableCodeToInline, bindingContext: BindingContext, analyze: () -> BindingContext): BindingContext {
-        val typeArgsToAdd = ArrayList<Pair<KtCallExpression, KtTypeArgumentList>>()
-        codeToInline.forEachDescendantOfType<KtCallExpression> {
-            if (InsertExplicitTypeArgumentsIntention.isApplicableTo(it, bindingContext)) {
-                typeArgsToAdd.add(it to InsertExplicitTypeArgumentsIntention.createTypeArguments(it, bindingContext)!!)
-            }
-        }
-
-        if (typeArgsToAdd.isEmpty()) return bindingContext
-
-        for ((callExpr, typeArgs) in typeArgsToAdd) {
-            callExpr.addAfter(typeArgs, callExpr.calleeExpression)
-        }
-
-        // reanalyze expression - new usages of type parameters may be added
-        return analyze()
-    }
-
     private fun insertExplicitReceivers(codeToInline: MutableCodeToInline, bindingContext: BindingContext) {
         val receiversToAdd = ArrayList<Pair<KtExpression, KtExpression>>()
 
diff --git a/idea/src/org/jetbrains/kotlin/idea/refactoring/kotlinRefactoringUtil.kt b/idea/src/org/jetbrains/kotlin/idea/refactoring/kotlinRefactoringUtil.kt
index bef5903d8d6..23cd9cd9f39 100644
--- a/idea/src/org/jetbrains/kotlin/idea/refactoring/kotlinRefactoringUtil.kt
+++ b/idea/src/org/jetbrains/kotlin/idea/refactoring/kotlinRefactoringUtil.kt
@@ -778,8 +778,10 @@ fun dropOverrideKeywordIfNecessary(element: KtNamedDeclaration) {
     }
 }
 
-fun getQualifiedTypeArgumentList(initializer: KtExpression): KtTypeArgumentList? {
-    val context = initializer.analyze(BodyResolveMode.PARTIAL)
+fun getQualifiedTypeArgumentList(
+        initializer: KtExpression,
+        context: BindingContext = initializer.analyze(BodyResolveMode.PARTIAL)
+): KtTypeArgumentList? {
     val call = initializer.getResolvedCall(context) ?: return null
     val typeArgumentMap = call.typeArguments
     val typeArguments = call.candidateDescriptor.typeParameters.mapNotNull { typeArgumentMap[it] }
diff --git a/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgument.kt b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgument.kt
new file mode 100644
index 00000000000..a8579a439db
--- /dev/null
+++ b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgument.kt
@@ -0,0 +1,5 @@
+fun bar(): List<Int> = listOf()
+
+fun f() {
+    val vv = <caret>bar()
+}
\ No newline at end of file
diff --git a/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgument.kt.after b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgument.kt.after
new file mode 100644
index 00000000000..90a2daa93c2
--- /dev/null
+++ b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgument.kt.after
@@ -0,0 +1,3 @@
+fun f() {
+    val vv = listOf<Int>()
+}
\ No newline at end of file
diff --git a/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentComplex.kt b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentComplex.kt
new file mode 100644
index 00000000000..84b7657fed9
--- /dev/null
+++ b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentComplex.kt
@@ -0,0 +1,10 @@
+interface SomeFace
+interface GeneOut<out T> {}
+object Empty : GeneOut<Nothing>
+fun <T> downUnder(): GeneOut<T> = Empty
+fun downParameter(p: GeneOut<SomeFace>) = p
+
+fun callDown() {
+    // BUG: KT-17402
+    val v2 = <caret>downParameter(downUnder())
+}
\ No newline at end of file
diff --git a/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentComplex.kt.after b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentComplex.kt.after
new file mode 100644
index 00000000000..b253891f80a
--- /dev/null
+++ b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentComplex.kt.after
@@ -0,0 +1,9 @@
+interface SomeFace
+interface GeneOut<out T> {}
+object Empty : GeneOut<Nothing>
+fun <T> downUnder(): GeneOut<T> = Empty
+
+fun callDown() {
+    // BUG: KT-17402
+    val v2 = downUnder()
+}
\ No newline at end of file
diff --git a/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentNotNeeded.kt b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentNotNeeded.kt
new file mode 100644
index 00000000000..a338043e9db
--- /dev/null
+++ b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentNotNeeded.kt
@@ -0,0 +1,5 @@
+fun bar(): List<Int> = listOf()
+
+fun ff() {
+    val copy: List<Int> = ArrayList(<caret>bar())
+}
diff --git a/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentNotNeeded.kt.after b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentNotNeeded.kt.after
new file mode 100644
index 00000000000..341812f590a
--- /dev/null
+++ b/idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentNotNeeded.kt.after
@@ -0,0 +1,3 @@
+fun ff() {
+    val copy: List<Int> = ArrayList(listOf())
+}
diff --git a/idea/tests/org/jetbrains/kotlin/idea/refactoring/inline/InlineTestGenerated.java b/idea/tests/org/jetbrains/kotlin/idea/refactoring/inline/InlineTestGenerated.java
index 4076dc0f9f5..c494abd790c 100644
--- a/idea/tests/org/jetbrains/kotlin/idea/refactoring/inline/InlineTestGenerated.java
+++ b/idea/tests/org/jetbrains/kotlin/idea/refactoring/inline/InlineTestGenerated.java
@@ -124,6 +124,24 @@ public class InlineTestGenerated extends AbstractInlineTest {
                 doTest(fileName);
             }
 
+            @TestMetadata("explicitTypeArgument.kt")
+            public void testExplicitTypeArgument() throws Exception {
+                String fileName = KotlinTestUtils.navigationMetadata("idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgument.kt");
+                doTest(fileName);
+            }
+
+            @TestMetadata("explicitTypeArgumentComplex.kt")
+            public void testExplicitTypeArgumentComplex() throws Exception {
+                String fileName = KotlinTestUtils.navigationMetadata("idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentComplex.kt");
+                doTest(fileName);
+            }
+
+            @TestMetadata("explicitTypeArgumentNotNeeded.kt")
+            public void testExplicitTypeArgumentNotNeeded() throws Exception {
+                String fileName = KotlinTestUtils.navigationMetadata("idea/testData/refactoring/inline/function/expressionBody/explicitTypeArgumentNotNeeded.kt");
+                doTest(fileName);
+            }
+
             @TestMetadata("FromUsage.kt")
             public void testFromUsage() throws Exception {
                 String fileName = KotlinTestUtils.navigationMetadata("idea/testData/refactoring/inline/function/expressionBody/FromUsage.kt");