India’s Negotiations With US On Limited Trade Deal Fall Through

by GoNews Desk 10 months ago Views 4570

Indo Us No Deal ON Trade talks
Minister of Commerce and Industry Piyush Goyal has said that India and the United States have not reached a consensus on a limited trade deal. India has had long-standing frictions with U.S. administrations regarding market access issues.

Speaking to the Export Promotion Council in Mumbai, the Union Minister of Commerce and Industry said that the U.S. has indicated that it does not want a new trade agreement with India at the present juncture. However, he said, “early harvest” deals are underway with Australia and the U.K.


India’s Negotiations With US On Limited Trade Deal Fall Through

“An early win” with Australia seemed on the horizon, he said, while also confirming that talks for a trade pact with Bangladesh were underway. Reaching a bilateral agreement with the EU could be tougher as the bloc has 27 member states and negotiations have started after 8 years, he said.

“We are engaging with industry to ensure that FTAs are fairly and equitably crafted. At the same time, FTAs cannot be one-way traffic...” he said.

“Our effort is to ensure focus on countries where we have significant potential, where we can compete better, and where market size is significant,” the minister added.

The Congressional Research Service is a legislative branch agency within the Library of Congress in the United States. In December 2020 it published an overview of the trade situation between India and the U.S. titled ‘U.S.- India Trade Relations’

Bilateral trade with India accounted for 3% of U.S. global trade. For India, the U.S. is a much more significant trading partner. In 2019, The U.S. was India’s largest goods export market (17%) and third largest goods imports supplier (7%). In its overview of Indo-U.S. trade, it stated that PM Narendra Modi’s first term promised “anticipated market-opening reforms” but instead ended up increasing tariffs and trade restrictions.

Market access, an issue brought up by Piyush Goyal, has been held up due to the corona-induced recession, the document states. In 2017, the Trump administration decided that India and Turkey would no longer qualiy under Generalized System of Preferences (GSP). India’s removal was based on a lack of multisectoral market access.


Briefly, these have been some issues of contention in terms of Indo-U.S. trade:

Tariffs

The U.S. often points to India’s high tariff rates in agriculture and telecommunication goods, as an example. India’s import tariffs led to it being called “tariff king” by ex-President Donald Trump. India on its part has also opposed the US’s Section 232 tariffs on steel and aluminum.
 

Services

India’s limits on foreign ownership and localization requirements have been flagged by the U.S. in the past. U.S. policies on temporary visas, in turn, affect Indian nationals.

Agriculture

India’s Sanitary and Phytosanitary restrictions on India’s part have led to trade restrictions. Both counties view each other’s agricultural support programs as undercutting the market.

Intellectual Property
India, like China, is seen or presented by the U.S. as lacking in a robust Intellectual Property(IP) protection system. India was placed on the U.S. 2020 Special 301 report Priority Watch List yet again. Patent protection, IP theft, and poor trade secret protection are some of the issues.
 

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