A comprehensive trade package, with mutually agreeable set of items on each nation’s tariff cuts, will be in focus as officials from India and the United States sit down to solve contentious trade issues.
Assistant US trade representative (USTR) Chris Wilson and USTR deputy assistant Brendan Lynch will be arriving in New Delhi for two-day long talks on Thursday.
However, after the meeting between Prime Minister Modi and US President Donald Trump at the G20, both governments had promised trade minister level talks. The upcoming meet is expected to set the template for the minister-level talks later.
Officials said while tariff issues would require time, the talks would see India getting back on the discussion table with the US for a comprehensive trade package. In the works for more than a year now, the package hopes to secure a list of imports, duties on which can be reduced to enhance market access. The Commerce Department has held around six bilateral discussions with the US Trade Representative's office and the Department of Commerce. Trade concessions across information technology goods, aviation and oil purchases have been part of the package.
But after repeated threats from US President Donald Trump on India’s protectionist steps, New Delhi had decided to go slow on the proposed ministerial talks on the package.
US Secretary of State Mike Pompeo had focused on the proposed package during his recent trip to India. “He secured a go ahead from the Prime Minister's Office,” a source said.
However, officials said the basic contours of the package must be renegotiated as experts had said the earlier terms were favourable to the US without helping India.
Balancing US deficit
New Delhi had considered dismantling of its current price cap regime for coronary stents with a trade margin policy, and agreed to concede lower duties on import of certain information and communication technologies products such as high-end mobile phones and smart watches from the US.
“Cheaper access to oil from Texas, along with a broad range of trade concessions, were offered by the American side,” another official said.
India is also the only major trade partner, with which the US trade deficit has gone down consistently. Annual figures released by the US authorities, a day after Washington DC snatched away India’s trade benefits under the Generalized System of Preferences, showed America’s trade deficit with India had shrunk to $21.3 billion in 2018, from $22.3 billion a year ago.