New Delhi: Defence and Energy will be the key areas of focus during the upcoming first visit of US Donald Trump to India, with the road cleared for acquisition of Multi-Role helicopters for the Navy.
The Cabinet Committee on Security today cleared the procurement of 24 MH-60R Helicopters for an approximate price of 2.6 billion USD ahead of the first-ever stand-alone visit of any American President to India.
In the past decade, India has procured over 18 billion USD worth of defence items from the US. Along with oil and gas, Defence has emerged as a key sector for India to reduce its trade surplus with America. Trump has repeatedly accused India of trade imbalance, lack of reciprocity in trade and high tariffs, an accusation New Delhi calls as ‘unfair’.
“We believe that our tariffs are not higher than tariffs that other developing countries have. We are being held to standards that are not necessarily comparable to other developing countries. Even countries like Korea and Japan have higher tariffs in many areas than we do,” argued an official source today.
On the energy sector, the US is now the 6th largest source of crude oil imports for India with hydrocarbon imports rising to US$ 7 billion in the last two years alone. “Relationship with the U.S. has evolved into one of our most consequential relationships today. It is a strategic partnership based on shared values and geared towards the 21st century.
Read: Ahmedabad hides slum stretch ahead of Trump's maiden visit
Whether in countering terrorism or in ensuring a peaceful and prosperous Indo-Pacific, India and the U.S. have unprecedented convergence of interests,” said Foreign Secretary Harsh Shringla ahead of the visit today.
However, despite eight months of intense negotiations a Mini Trade Deal on Goods still remains elusive and now postponed for a later date.
Government sources though argue that this should not be seen as ‘No Deal’ or ‘Stuck Deal’, rather as an ongoing complex time requiring process. Sources claim that both US Trade Representative Robert Lighthizer and Commerce Minister Piyush Goyal agreed that a trade deal must not be ‘rushed into on the eve of the visit’ as a right balance needs to be struck.
“Like the US we are also seeking a mutually beneficial deal in terms of the market access. Our priority is to restore GSP (General System of Preferences). GSP is unilaterally granted concession.
It is not incumbent on the US to grant us concession and market access. This was unilaterally done and unilaterally withdrawn. We want to see restoration,” said government sources adding that the withdrawal has not significantly impacted Indian exports in 2019 in areas where GSP was applicable.
Read: Saving big trade deal with India for later: Trump
Lighthizer who did not fly in for an expected meeting with Goyal ahead of the big visit is not ruled out yet from being a part of the official delegation along with US Commerce Secretary Wilbur Ross, Presidential Advisor and Trump’s son in law Jared Kushner, Treasury Secretary Mnuchin among others according to sources.
The U.S. is India’s largest trading partner in goods and services combined today with overall bilateral trade increasing by over 10 % annually over the past two years. Bilateral trade that stood at US$ 142 billion in 2018 is expected to cross US$ 150 billion this year.
Amid criticisms of possibly no big-ticket announcements and focus only on optics during the almost 36 hours three-city visit of Trump, New Delhi is stressing upon the ‘maturity’ of the strategic partnership and forward-looking relationship. Trump with First Lady Melania will travel through a 22 kilometre long roadshow from the Ahmedabad International Airport to the new cricket stadium in Motera on February 24. Along the way, packed crowds will greet the couple accompanied by Prime Minister Modi and 28 stages will be built depicting number of states along the way with artists portraying Mahatma Gandhi’s life and heritage.
Sources point out that this fifth meeting between Trump and Modi within eight months is proof of renewed bilateral engagements with two sides working to showcase ‘progress in ties’. “India as emerging power has to have relations not necessarily based on transactional nature. Not every visit will have big-ticket item Relation with the US matured to have Summit level exchanges without deliverables at that level,” stressed government sources.
“The talks will be comprehensive and cover issues relating to our strategic partnership in the areas of defence, security, counter-terrorism, as well as trade, energy, people-to-people exchanges and other bilateral matters. They would also exchange views on regional and global issues of shared interests,” underlined the Foreign Secretary earlier today.
‘Kashmir Issue Not A Factor In Trump-Modi Exchange’-Sources
With five days left to go for the first visit of Donald Trump, New Delhi is also hopeful that the Kashmir, CAA and NRC related controversies will not shadow discussions. Government sources claimed that ‘most restrictions’ imposed in Jammu and Kashmir post abrogation of Article 370 have been lifted and US Ambassador Kenneth Juster has visited the valley along with other envoys. They argued that State Department briefings have made it clear that Kashmir is an issue to be resolved only by India and Pakistan and it will ‘Not be a major factor in Indo-US exchanges’ during the visit.
Read: INTERVIEW: 'Partial deal unlikely, but trade does not define Indo-US ties'
“Trump has made it clear on many occasions that mediation in Kashmir is dependent on both countries accepting. We have made it time and again that this is not acceptable to us. So this is an offer which is only conditional. Not a serious one that is being acted upon. Mediation is only on minds of few, do not think it will come up in any of our conversations,” said a senior official privy to discussions in reply to a question on Trump’s controversial offer of mediation on past occasions and chances of unpredictable controversial remarks on Kashmir while he is in India.
It is learnt that the recent political situation in Afghanistan following the announcement of Presidential election results and US-Taliban peace talks will also figure in Modi-Trump formal talks given their implications on India and the region. Sources added that counter-terrorism and security remains an important area of cooperation between the two democracies with the US ‘not resiling on terrorism emanating from Pakistan’.
“US has taken a consistent and strong position when it comes to terrorism. They have strongly supported India’s actions post Pulwama. When the issue of listing of Masood Azhar under 1267 of the UNSC came up they were at the forefront of trying to ensure this was done. We have extensive cooperation with the US on counter-terrorism and also institutional mechanisms at all level levels to discuss counter-terrorism. We have always felt this is one of the strongest areas of our strategic partnership,” remarked a senior official.
