US Team to Visit India for Bilateral Trade Agreement Talks
The US team is scheduled to visit India on August 25 for further negotiations regarding the proposed bilateral trade agreement between the two countries. Both sides are currently engaged in discussions as the deadline of August 1 approaches.
Background of the Trade Negotiations
August 1 marks the end of the temporary suspension period on tariffs imposed by US President Donald Trump, including a 26% tariff on India among other countries. This visit will mark the sixth round of talks between the US and India.
After concluding the fifth round of talks last week in Washington, India’s Chief Negotiator Rajesh Agrawal and Assistant US Trade Representative Brendan Lynch are working towards finalizing an interim trade deal before the deadline.
Key Issues in the Negotiations
India has taken a firm stance on not granting duty concessions on agricultural and dairy products, a demand put forth by the US. New Delhi has refrained from offering such concessions in previous free trade agreements related to the dairy sector and is maintaining that stance.
On the other hand, India is pushing for the removal of the existing 26% tariff, as well as seeking reductions in tariffs for steel, aluminium, and the auto sector. These matters are crucial aspects of the ongoing negotiations.
Trade Deal Concerns and Demands
India has the right to impose retaliatory duties as per WTO norms and is also seeking duty concessions for labor-intensive sectors like textiles, gems, jewelry, and more in the proposed trade pact. Meanwhile, the US is looking for concessions on industrial goods, automobiles, wines, and agricultural products.
Timeline and Expectations
Both countries aim to finalize talks for the initial phase of the proposed bilateral trade agreement by fall (September-October) this year. Prior to that, an interim trade pact is being targeted for completion.
Economic Impact
India’s merchandise exports to the US have increased by 22.8% to USD 25.51 billion in the April-June quarter of this financial year, while imports have also seen a rise of 11.68% to USD 12.86 billion.
This visit and ongoing negotiations are crucial for shaping the future of trade relations between India and the US.
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