India, United States close to finalizing ‘initial’ trade deal
India and the United States are set to finalize an “initial” trade agreement soon that could pave the way for a larger deal at a later stage, including an ambitious Free Trade Agreement.
A US delegation is scheduled to travel to India next week to “put the final touches” on a deal, following “productive” conversations between Commerce and Industry Minister Piyush Goyal and his US counterpart Robert Lighthizer, the top trade negotiators for their countries.
They also spoke over the phone on Thursday to further the discussions, a person familiar with the talks said, characterizing the conversation as evidence of a new level of comfort for the two sides in addressing the most intractable, supposedly, of their differences.
No details were available to the issues resolved during these interactions, but the person cited above said, the discussion was based on the desire of the two sides to get “equitable market access” on a reciprocal basis.
India and the United States have been in talks for months now to resolve trade differences that would address issues agitating ties urgently and also lay the ground for an ambitious Free Trade Agreement, which was indicated by Goyal earlier in the month.
The two countries are looking at a near-term deal and a longer-term version sometime in the future as indicated by Indian and US officials. The two-track negotiations were first discussed publicly by President Donald Trump in remarks to reporters before his bilateral meeting with Prime Minister Narendra Modi on the sidelines of the UN General Assembly meetings in New York in September, “We’ll have the larger deal down the road (in) a little bit, but we will have a trade deal very soon.”
Goyal and Lighthizer had met then for talks that both sides had described as sincere. They had also struck an “excellent rapport” according to people tracking the talks closely. They have spoken on the phone several times since, to advance the negotiations, which had been described at one stage as in “need of one more meeting of the principals”.
And that meeting took place here on Wednesday.
No details were available of the talks — other than that “important” issues were resolved — India wants the removal of US tariff on Indian steel and aluminum and the restoration of special preferential trade benefits under the Generalized System of Preferences (GSP), which were suspended in June. The US has a longer wishlist with access to dairy and medical devices sectors, lower Indian tariff on ICT products.
The United States has a longer, and growing, list of demands, from access to India’s dairy and medical devices markets to lower tariff on ICT products and the rollback of data localization rules mandated by the government.
There has been speculation that if the two sides were able to reach an agreement, President Trump could travel to India for the signing. But officials on both sides have discounted it, saying a visit looks “improbable” at this stage.