New Delhi: With US President Donald Trump building pressure on India over tariffs imposed on American products, trade negotiations between New Delhi and Washington are expected to intensify in the coming months, ThePrint has learned.
A working-level trade delegation from the office of the US Trade Representative (USTR) led by Christopher Wilson, Assistant USTR for South and Central Asia, is already on its way to India and will be holding talks with Indian trade officials Thursday, sources told ThePrint.
This will be followed by Commerce and Industry Minister Piyush Goyal’s visit to Washington later this month. Goyal will meet USTR Robert Lighthizer to iron out the differences that have significantly destabilised trading relations between India and the US.
Full-blown trade war
On Tuesday, Trump tweeted: “India has long had a field day putting Tariffs on American products. No longer acceptable!”
Trade has always been a thorny issue between both the countries historically. However, under the Trump administration, the tiff has snowballed into a full-fledged trade war.
When, in June this year, the US withdrew India’s preferential trade status under the Generalised System of Preferences (GSP) scheme, India imposed retaliatory tariffs on 28 American goods, including apples, almonds, walnuts, phosphoric acid and some engineering and steel products.
This prompted the US to file an official complaint against India at the World Trade Organisation (WTO) last month in which it said New Delhi’s move to impose tariffs on American goods was “inconsistent with provisions of the WTO’s General Agreement on Tariffs and Trade by unfairly discriminating against US imports vis-à-vis those from other WTO members and by according less favourable treatment to US goods than that provided for in India’s schedule of concessions.”
However, with a series of high-level dialogues that took place between both the countries recently, it was expected that India and the US will probably head for an amicable solution.
First, it was US Secretary of State Mike Pompeo meeting External Affairs Minister S. Jaishankar during a short trip to India last month, and then Prime Minister Narendra Modi meeting Trump on the sidelines of the G-20 Summit in Osaka that ended on a positive note.
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More trade meetings in coming months
Sources said a series of meetings will be happening between both the sides now in order to find an amicable solution for the trade skirmishes.
India’s retaliatory tariffs, which went as high as 70 per cent on some of the US goods, came in the wake of America’s refusal to exempt India from higher duties on steel and aluminum imports.
Bilateral trade between India and the US stood at $142 billion in 2018-19. However, with the withdrawal of GSP benefits, Indian exports to America worth $6 billion are likely to take a hit.
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India, like the rest of the world, will have to get used to diplomacy by and on Twitter. The British Ambassador has virtually been declared persona non grata for doing his job competently. 2. Former Foreign Secretary Shyam Saran has pointed out that protectionism is as harmful to India’s economic well being today as it was in the period leading up to 1991. Not the roadmap to $ 5 trillion, he says. He has seen one Asian country after another surge far ahead of India by following a different economic model. I cannot judge whether President Trump’s anger towards Indian trade practices is well deserved. However, seen in totality, a recast is necessary.
Socialist Modi will not lower tariffs