Narendra Modi with Donald Trump |
PM Narendra Modi meets his US counterpart Donald Trump on the sidelines of the G-20 summit in Osaka, Japan in June 2019 | Photo: @narendramodi | Twitter
Text Size:

New Delhi: India and the U.S. are working toward easing trade tensions, including a possible withdrawal of some disputes from the World Trade Organization, ahead of a meeting between leaders of the two economies, according to people familiar with the matter.

Giving market access to U.S. dairy products, premium pricing power for some innovative American medical devices and tax concessions on information technology are also among the so-called goodwill measures being considered by India, the people said. In return, the U.S. may possibly restore India’s preferential trade treatment terminated earlier this year, they said, asking not to be identified as the discussions are private.

Easing of trade tensions will help India boost exports and cushion an economic slowdown caused by a collapse in domestic consumption. India was the largest beneficiary of the generalised system of preferences or GSP — under which developed countries encourage developing economies to industrialise — before the concession was ended.

The trade department in New Delhi has been holding daily meetings over the last few days to work out a doable package in time to be taken up by Prime Minister Narendra Modi when he embarks on a week-long trip to the U.S. on 21 September, the people said. During the trip he will attend the ‘Howdy Modi!’ event in Texas with President Donald Trump. The details of any deal are yet to be finalized, the people said.

A spokeswoman for India’s trade ministry couldn’t be immediately reached for comment.

Tensions have been simmering for some time between the two nations with bilateral trade of close to $90 billion. Trump has accused India of charging higher duty on American imports, particularly tariffs as high as 100% on Harley-Davidson Inc. motorcycles — an issue he had flagged in a joint address to Congress in February 2017. The U.S. is also challenging India’s retaliatory tariffs at the WTO. India imposed higher tariffs on almost 30 American products in response to Trump’s decision to end trade concessions.

Also read: Hopes of new economic alliances as Modi is set to hard-sell India to US investors

We are deeply grateful to our readers & viewers for their time, trust and subscriptions.

Quality journalism is expensive and needs readers to pay for it. Your support will define our work and ThePrint’s future.


Following his accusations of India running a high trade surplus with the U.S., New Delhi has been buying more oil, natural gas and coal, drones and aircraft from America, resulting in reducing the trade surplus in 2017 and 2018, according to India’s trade ministry.

Here are key contentious issues between the two sides:


India, one of the largest dairy markets in the world, does not allow import of U.S. milk and dairy products on religious and cultural grounds. India has objections to allowing products of animals that are fed the so-called blood meal or tissues of ruminant origin. India may consider giving conditional access, the people said.

Medical devices

The U.S. wants India to remove price caps on medical devices, especially on coronary stents and knee implants. While that may be unlikely, India may agree to give premium pricing power to innovative American pharmaceutical devices.

Communication products

India is willing to offer duty concessions on specific items, for which the department of electronics and information technology has initiated talks.

Steel, Aluminum

Trump exempted nations including Brazil and South Korea from higher tariffs last year in exchange for quantitative restrictions. India has refused to accept such a deal.

Preferential treatment

Though only $5.6 billion worth of products received duty benefits worth $190 million in the year ended March 18, restoration of the benefits under GSP has been on top of India’s agenda due to its competition with low-cost rivals.

Also read: As Narendra Modi meets Donald Trump, big test is to keep the quiet in Kashmir


Subscribe to our channels on YouTube & Telegram

News media is in a crisis & only you can fix it

You are reading this because you value good, intelligent and objective journalism. We thank you for your time and your trust.

You also know that the news media is facing an unprecedented crisis. It is likely that you are also hearing of the brutal layoffs and pay-cuts hitting the industry. There are many reasons why the media’s economics is broken. But a big one is that good people are not yet paying enough for good journalism.

We have a newsroom filled with talented young reporters. We also have the country’s most robust editing and fact-checking team, finest news photographers and video professionals. We are building India’s most ambitious and energetic news platform. And we aren’t even three yet.

At ThePrint, we invest in quality journalists. We pay them fairly and on time even in this difficult period. As you may have noticed, we do not flinch from spending whatever it takes to make sure our reporters reach where the story is. Our stellar coronavirus coverage is a good example. You can check some of it here.

This comes with a sizable cost. For us to continue bringing quality journalism, we need readers like you to pay for it. Because the advertising market is broken too.

If you think we deserve your support, do join us in this endeavour to strengthen fair, free, courageous, and questioning journalism, please click on the link below. Your support will define our journalism, and ThePrint’s future. It will take just a few seconds of your time.

Support Our Journalism

Share Your Views


Please enter your comment!
Please enter your name here