Delhi: An Indo-US trade deal has become a topic of discussion ahead of the US President Donald Trump’s maiden visit later this month. Prime Minister Narendra Modi will host the US leader both in national capital New Delhi and also in his home state Gujarat.
According to reports, a limited trade deal between the two countries could be signed during the visit which could cover $10 billion worth of goods and services, nearly 12% of the total bilateral trade. However, the deal is not only opposed by the farmers who fear dumping of US farm and dairy products but is also opposed by some trade experts.
“I am very pessimistic that any trade deal will occur with the US. If it does then we might end up compromising our basic stand on protecting our agriculture, dairy and those items that we want to encourage under our Make in India and Assemble in India policies,” said Ajay Dua, former commerce secretary.
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It will not be easy for Indian negotiators to hammer out a deal ahead of the US President Trump’s visit as this week the US removed India and several other countries from the list of developing countries that were exempt from investigations about any potential harm to the US industry due to subsidised exports.
With this change, which has been announced days before the US President’s India visit, also scuttles any hopes of restoration of GSP benefits to the country as part of a proposed deal.
The Generalised System of Preference adopted by the US in 1975, eliminated duties on thousands of items imported from 119 designated countries including India. Nearly 10% of the Indian exports to the US benefited from GSP benefits which were withdrawn by the Trump administration from June last year.
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The US President Trump has often blamed India and China of taking advantage of ‘developing country’ tag in the global trade system. He has often blamed India for having very high tariffs.
Foreign trade experts like Ajay Dua, who have been closely involved with India’s trade negotiations and World Trade Organisation (WTO) caution against rushing to any trade with the US.
“I am for a negotiated deal, the deal which has been negotiated hard, and do not do anything under pressure that you have to show something as a success of President Trump’s visit,” Ajay Dua told Krishnanand Tripathi, senior journalist of ETV Bharat.
