The signing of the India-US trade deal will happen only after the new tariff framework is in place, Commerce Secretary Rajesh Agrawal said on Monday during a trade data briefing.
Agrawal said the pact will be finalised once Washington restores global tariff rates following a court ruling that had struck them down.
"Because at the end of it, each country is doing a deal as a part of a package where one is at comparative advantage...vis a vis competitors," the official said, news agency PTI reported.
India and the US last month announced the finalisation of a framework for the first phase of their bilateral trade agreement. Under the proposed framework, the US had agreed to lower tariffs on Indian goods to 18 per cent.
However, the tariff structure in the US has since changed following a Supreme Court ruling against President Donald Trump’s sweeping tariffs. After the ruling, Trump imposed a 10 per cent tariff on all countries for 150 days starting February 24, the PTI report added.
Amid these developments, the meeting between the chief negotiators of India and the US has been postponed. The two sides were scheduled to meet last month to finalise the legal text of the pact, which had earlier been expected to be signed this month.
India engaged in talks with US and 6 others
{{/usCountry}}Amid these developments, the meeting between the chief negotiators of India and the US has been postponed. The two sides were scheduled to meet last month to finalise the legal text of the pact, which had earlier been expected to be signed this month.
India engaged in talks with US and 6 others
{{/usCountry}}On Monday, the commerce secretary said that New Delhi is currently engaged in talks with Washington on the details of the trade agreement.
"The deal was to be signed in March. (But) When we said this, that time, the Supreme Court judgment on IEEPA (International Emergency Economic Powers Act) tariffs had not come. Now, with the Supreme Court judgment on IEEPA tariffs, the tariffs per se don't exist.
"Now there are tariffs under Article 122, which is related to the balance of payment crisis, which are for five months. And the tariff is around 10 per cent. So the deal that we finalise and sign has to be against the tariff structure or the comparative advantage that India gets in the US market," the official said.
Apart from America, the government said that it is currently negotiating six Free Trade Agreements (FTAs) with different countries and regional groups as part of efforts to expand trade partnerships.
Negotiations are ongoing with Australia, Sri Lanka, Peru, Chile, the Eurasian Economic Union (EAEU), and Israel, another report from news agency ANI added.
US' ‘unfair trade’ practices probe
Earlier this week, the Trump administration moved to rebuild tariff pressure after the Supreme Court's blow. In the latest step, the Office of the US trade representative on announced the launch of a trade investigation into alleged unfair manufacturing practices by India and 15 other major economies.
The move, known as a Section 301 investigation under the Trade Act of 1974, could allow the US government to impose new tariffs, curb imports, or suspend trade agreement concessions against countries found to be engaging in unfair trade practices.