US and India close to trade deal
Besides cutting import duty on contentious items including high-end bikes like Harley-Davidsons, India and US have agreed to allow more goods to be shipped between both the countries. The development will further brighten the trade deal between India and the US. An announcement on the same is very likely next week, as an assessment of the gains is being undertaken. According to a report with the Times of India, there have been discussions on the trade package being unveiled during the next meeting between PM Narendra Modi and US President Donald Trump.
Finding dates, however, may be an issue given that the US is heading into election season and this may result in the announcement being made by commerce and industry minister Piyush Goyal and US trade representative Robert Lighthizer.
According to the report, medical devices that are brought under price control or whose trade margins are capped may not enjoy the benefits of carve-outs in the future.
In return, the US is expected to provide preferential duty benefits for some Indian exports under the Generalised System of Preferences (GSP) programme, which had been withdrawn by the Trump administration earlier this year after the Indian government slapped retaliatory tariffs on several American goods, including apples, almonds and walnuts.
Some farm products from either side, such as Indian mangoes and pomegranates, may get easier access into the US while New Delhi will address American concerns over import of alfalfa hay.
Although India had clearly indicated to the US that it was willing to address several of its concerns, the emphatic mandate to Modi and detailed negotiations between Goyal and Lighthizer over the last three months helped the two countries recognise each other’s concerns and red lines better, sources said.
They said both governments are approaching the negotiations as part of their broader strategic partnership rather than through the sole prism of trade deficit.
“The US has been very helpful to us on a range of issues, like terrorism, Jammu and Kashmir, membership to Nuclear Suppliers Group, and this has inevitably been a factor in our approach,” said a senior source on the condition of anonymity.
Despite the package, information technology and telecom goods, e-commerce and data privacy issues, as well as some matters pertaining to intellectual property rights, will be dealt with separately.
While India had offered to lower import duties on high-end ICT products, the US authorities were unwilling to accept what was on the table.
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