Trade Talks Hit A Rough Patch — US Official Calls Off The Trip

Prior to US President Donald Trump’s visit to India on February 24-25, 2020, there are signs that the India-United States trade talks have hit a rough patch. As per the official sources report Robert Lighthizer, U.S. Trade Representative (USTR), have cancelled his trip to India this week. However, the sources that are aware of the trade negotiations do not put forward any explanation regarding the change of plans from the USTR’s visit, which was supposed to take place on February 13.

Despite this, there is speculation that he might be a part of President Trump’s entourage during his visit scheduled later this month. He is expected to finalise a “mini-trade deal” or a trade package with his Indian counterpart, Piyush Goyal– the Commerce and Industry Minister, on items that are under negotiations for around two years.

Nisha Biswal, President of the US-India Business Council (USIBC) at the US Chambers of Commerce said in an interview during her visit to India this week that on the off chance that President Trump and Prime Minister Narendra Modi fail to bring even a modest understanding forward; it will be a “missed opportunity” to gain ground that can profit the two nations and fortify financial ties.

However, she is also “optimistic” about a “limited trade deal” to be signed between the nations as a part of President Trump and America’s First Lady, Melania Trump’s visit to Delhi, Ahmedabad, and Agra.

As per sources, discussions so far have brought some agreement on debatable issues such as medical device price caps levied by India, rationalisation of tariffs levied by both countries, and greater market access for the agricultural and dairy products of America.

The US may also offer a partial restoration of the Generalised System of Preferences (GSP) concessions to Indian exporters in the sectors where American importers are dependent on Indian products.

Raising tariffs on electric vehicle (EV) components, dairy products, shelled walnuts, edible vegetable oils, infant foods, and soy products may become a topic of discussion.

The bigger deals mainly focus in the area of defence, including helicopters, air defence system, energy worth 2.4 billion dollars.

Deals involving 24 MH-60R multirole helicopters for the Indian Navy, quick reaction air defence system to protect Delhi, armed drones, six P-8I surveillance aircraft, also two Raytheon ISTAR aircraft are at advanced stages and waiting for finalisation.

India might also discuss the rise in LNG imports from the US following India’s gas importer Petronet’s MoU signed with US company Tellurian Inc’s LNG project during Modi’s Houston visit.

India, the world’s biggest milk-producing country, has customarily confined dairy imports to ensure the employments of 80 million rustic family units engaged with the business. However, PM Modi is attempting to pull all the stops for the US President’s February 24-25 visit, planned for reconstructing bonds between the world’s largest democracies.

Though whether these attempts would be enough to satiate the USTR is unclear, Robert Lighthizer has called off his trip and is engaged in phone conversations with Commerce Minister, Goyal.

Whether the USTR will accompany Trump and carry forward the trade talks, and the resulting future of India-US trade relations would be made transparent in the much-awaited upcoming visit.

Aishani Sarkar

An ardent literature lover with my mind constantly travelling through far-off unexplored worlds. A lover of languages and cultures--the sweetest language in the world being my mother-tongue. Chasing the Northern Lights...taking one step closer. My pen is my sword. #BongAtHeart

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