Minister bats for 'much larger engagement' like a bilateral trade agreement India and the US have resolved most of their broad trade differences and
Minister bats for ‘much larger engagement’ like a bilateral trade agreement
India and the US have resolved most of their broad trade differences and the countries must look at a much larger deal like a bilateral agreement, Commerce and Industry Minister Piyush Goyal said on Monday.
Addressing senior members of American industry at a conclave organised by the US-India Strategic Partnership Forum (USISPF), Goyal expressed optimism about the bilateral relationship that he said “is at their best ever now”.
“We have almost resolved the broad contours of what we are going to announce. I do not see any great difficulty in closing the gap on the first announcement,” he said.
He, however, refused to give a deadline on the current trade talks taking place between the countries. “Trade negotiations are complex. You need to have a lot of back and forth, which is going on. We’ve had a little pause because all of us were busy in different areas. But it’s on track and everything is moving smoothly,” he said.
A trade arrangement with the US was expected during Prime Minister Narendra Modi’s six-day visit to that country last month. However, with Modi by his side, US President Donald Trump had last month promised a trade deal with India “very soon”, with a larger deal down the line.
Goyal stressed that India was looking to the US for technology, innovation, skills, and quality education. India, on the other hand, offers an attractive market to US businesses, skilled labour, and technical expertise in areas that can add value to American companies. According to USISPF estimates, the bilateral trade is projected to grow to $238 billion by 2025.
India wants a mutually acceptable ‘trade package’ that provides an amicable solution to major grouses from both the sides, according to a senior trade negotiator. India is considering dismantling its current price cap regime for coronary stents with a trade margin policy. It may also allow lower duties on import of certain information and communication technology products such as high-end mobile phones and smartwatches from the US, which may make iPhone products cheaper in the country.
In return, the US has offered to step back from its aggressive posturing on ‘reciprocal taxes’. Trump has also repeatedly accused India of being a ‘high tariff nation’, referring to duties placed on US-made Harley Davidson motorcycles.
Talks had run the risk of coming apart earlier this year, after the US had cut off India’s duty-free access to the American market under its largest preferential trade scheme, the Generalized System of Preferences (GSP). Subseq-uently, India had raised duties on key high-value imports from the US, mostly among agricultural products such as apples and almonds. Reinstatement of GSP benefits have remained a key part of the Indian demand list, according to sources.
Sources say the US has also asked India to confirm that the current economic slowdown and the turmoil in the domestic aviation sector will not affect civilian aircraft purchases by India. Low-cost carrier Spicejet itself has ordered 205 aircrafts from US manufacturer Boeing. In the works for more than a year, the proposed package has seen trade officials from both sides meet as many as six times to try and hammer out a deal.
Goyal sounded cautious on the ongoing negotiations on the proposed Regional Comprehensive Economic Partnership (RCEP) deal. He said the government continued to keep the interests of domestic industry above all and that previous governments had frittered away the opportunity of free trade agreements.
“The Congress regime did agreements in a hurry, often asymmetrically against India’s interests with clauses that were detrimental to India. There were no gains on services, and India’s market access in a significant measure to those countries,” Goyal said. The final 10-day window for bilaterally sorting out contentious trade issues in RCEP ends on Tuesday. As a result, decisions on crucial trade differences in 14 areas — if not resolved — will be taken by Prime Minister Narendra Modi when he attends the third RCEP leaders’ summit next month.
First Published: Mon, October 21 2019. 21:20 IST