Trade, FDI & visa on table for India-US strategic dialogue

Issues key to bilateral relations will be ironed out during US secretary of state John Kerry's 3-day visit starting today

As US secretary of state John Kerry arrives here tomorrow to attend the fourth India-US Strategic Dialogue on June 24, both sides will be seen taking on each other on some topics that have affected their strategic relationship such as trade policies, foreign direct investment (FDI) and work visas.

Kerry, who is visiting India for the first time in his present capacity, will have the dialogue with foreign affairs minister Salman Khurshid. The Strategic Dialogue, started in 2009, is a forum for discussing the full range of India-US cooperation on bilateral and regional issues. During the three-day visit, Kerry is also expected to open the second annual India-US Higher Education Dialogue.

Trade disputes
For the last couple of years, India and the US have been engaged in some major trade disputes that have ended up at the World Trade Organizations’s (WTO) dispute panel. Among these, the high-profile cases concerning Indian steel exports to the US and poultry imports from the US are up for hearing at the WTO dispute resolution body on July 9 and July 25, respectively. Besides, both sides have raised serious questions on supporting and subsidising their respective solar equipment manufacturing firms as a result of which investments worth billions of dollars are held up.

Both sides have also not been in favourable terms as far as the upcoming WTO ministerial is concerned, which is going to take place in Bali, Indonesia, on December 3-6 to discuss the Doha round of global trade talks. Though a conclusion of the talks look implausible, it is widely expected that this time, member-countries might sign a trade facilitation agreement for the benefit of the poor countries. But India has asked the WTO to consider the deal of food security based on the G-33 recommendations.

Comprehensive immigration Bill
Issues concerning work visas – H1B and L1 – had been a bone of contention between both countries since 2010 when visa fees were hiked from $2,000 to $4,500. India even moved WTO on this. The matter got settled.

However, now the US has floated a new legislation which is officially called the ‘H-1B and L-1 Visa Reform Act of 2013’ that has irked India. The government has said the draft new law is completely against Indian information technology companies present in the US and if it is passed in the current form, then India will be forced to take some action.

Intellectual property laws/ patents
While the US always felt and spoke strongly about India’s weak IPR (intellectual property rights) laws and patent provisions, the recent incident of the Supreme Court rejecting patent to Novartis on its cancer drug has led to a series of allegations by US drugs makers. However, India has maintained its stance that it is against granting frivolous patents and ever-greening drugs.

In the 2013 National Trade Estimate Report on Foreign Trade Barriers, issued by the office of the US Trade Representative (USTR), the US government has accused India of lacking “effective protection against unfair commercial use of undisclosed test and other data generated to obtain marketing approval for pharmaceutical and agrochemical products”. It has also stated that India has “weak protection and enforcement of intellectual property rights” and that recent patent-related happenings have only “heightened concerns.”

Cyber security
Earlier this month, a certain programme – PRISM – run by the American intelligence agencies, came to light under which the US is reportedly tracking servers of nine internet biggies as part of their secret data mining programme of which India is one. Indian officials reacted to the report with “concern”.

Both sides are expected to discuss the matter during the strategic dialogue. The cyber security dialogue between India and the US is coordinated by both National Security Councils in India and US.