India-US Trade Deal Urgently Needed to Enhance Economic Growth, Says USIBC

The US-India Business Council stresses the need for a bilateral trade deal to enhance economic growth for both nations. Discussions between Indian Commerce Minister Piyush Goyal and US counterpart Howard Lutnick have begun, aiming to eliminate barriers to trade. However, experts advise caution due to potential demands from the US that could complicate negotiations.

The US-India Business Council (USIBC) has emphasized the urgency of establishing a bilateral trade agreement during the discussions between Indian Commerce Minister Piyush Goyal and US counterpart Howard Lutnick. USIBC President Atul Keshap highlighted the necessity to eliminate non-tariff barriers and bureaucratic hurdles that hinder market access, stating that a trade deal is crucial for the economic advancement of both nations.

In a meeting held in Washington, Goyal and Lutnick explored potential frameworks for cooperation. Goyal is additionally scheduled to meet the newly-appointed United States Trade Representative (USTR) Jamieson Greer, prior to the implementation of reciprocal tariffs that will affect several countries, including India, in the upcoming month.

Recent discussions between Prime Minister Narendra Modi and President Donald Trump have resulted in a mutual agreement to initiate negotiations for a beneficial bilateral trade agreement within the next few months. However, this trade deal is being discussed amidst impending tariffs imposed by the Trump administration on imports to the US.

Keshap indicated that formalizing a trade framework is vital, as India currently represents only 2.5 percent of US trade volume. He asserted that increased trade could significantly enhance economic activity, job creation, and investment opportunities in both countries.

Despite optimism surrounding the trade negotiations, caution has been advised by a Delhi-based think tank regarding India’s potential entry into a comprehensive Free Trade Agreement (FTA) with the US, citing past issues with trade agreements negotiated under the Trump administration. The think tank pointed out the need for careful consideration, emphasizing the history of changes to agreements like the USMCA.

The US recently imposed 25 percent tariffs on imports from Canada and Mexico, highlighting the administration’s ongoing dissatisfaction with existing trade agreements. Concerns arise that during trade negotiations, the US may seek not only tariff reductions but also additional concessions that may be challenging for India, such as adjustments in agricultural subsidies and patent protections.

The article outlines the growing discussions around a potential India-US bilateral trade deal, emphasizing its importance for economic growth in both nations. While hopes are high for formalized trade agreements, stakeholders express concerns regarding the possible demands from the US that could complicate negotiations. Establishing a mutual understanding and agreement remains essential for both countries moving forward.

Original Source: www.business-standard.com