Top USTR Team in India to Finalise Mini-Trade Package

Disproportionate demands made by Washington compared to what it is willing to offer remain a sticky issue, say officials

A high-level team of officials from the US Trade Representative’s (USTR) office is in India to talk to its counterpart in the Commerce and Industry Ministry to try and conclude the on-going mini-trade package talks.

“The US Trade Representative and Commerce & Industry Minister Piyush Goyal could not finalise the trade package during the Indian Minister’s recent visit to Washington due to some sticking issues related to market access for certain items for the US and restrictions on pricing for medical equipment. The USTR team that is visiting India this week will try to find a solution to these issues,” a government official said.

The disagreement is likely to be over the disproportionate demands made by the US compared to what it wants to offer India in the package, the official added. The US wants India to lower import duties on items such as mobile phones, high-end motorbikes like Harley Davidsons, apples, almonds and dairy items and also lower pricing restrictions for medical equipment manufacturers.

India’s demands are mostly defensive. It wants Washington to restore Generalised System of Preferences (GSP) benefits for its exporters that was withdrawn earlier this year and roll-back unilateral import duties imposed on aluminium and steel last year. It is also hopeful of getting increased market access for certain agricultural goods, including fruits and vegetables.

‘Optimistic of solution’

According to the Ministry of External Affairs (MEA), India is optimistic that a solution will be found soon to the complex issues being discussed as part of the mini-trade package with the US.

“There have been discussions between the two sides on trade since the two leaders (Prime Minister Narendra Modi and US President Donald Trump) met and instructed their officials to find a solution to the trade issues. There have been discussions since then. These matters are complex. We remain optimistic that a solution be be found soon,” said Raveesh Kumar, spokesperson, MEA.

The Trump government has been vocal in its disappointment over the high trade deficit it has with India and despite steps being taken by New Delhi to lower it over the last two years by importing more oil and gas and other items, Washington still remains dissatisfied.

Bilateral trade

The US is one of India’s largest trading partners and bilateral trade is projected to grow to $238 billon by 2025 from about $90 billion at present, acccording to the US-India Strategic Partnership Forum estimates.