India-US discuss trade, non-tariff measures; reaffirm commitment to BTA

Negotiators held four days of discussions on goods, customs, trade facilitation and economic security, while fresh US tariff proposals emerged during the talks

India and the US on Thursday concluded a round of negotiations covering multiple areas, including trade in goods and non-tariff measures, among others, for a mutually beneficial trade deal.

 

The talks were held during a four-day visit by Assistant US Trade Representative for South and Central Asia Brendan Lynch and his team to New Delhi.

 

"During the visit, the teams held constructive and positive discussions across a wide range of issues covering trade in goods, non-tariff measures, customs and trade facilitation, economic security alignment and other areas of mutual interest," the commerce department said in a statement on Thursday.

 

 

"The engagements were marked by a spirit of cooperation and pragmatism, with both sides reaffirming their commitment to concluding a mutually beneficial agreement that strengthens bilateral trade and economic ties," the commerce department said.

 

While Lynch, who is the chief negotiator for the US' Bilateral Trade Agreement (BTA) with India, held the latest round of negotiations with India's chief negotiator Darpan Jain, additional secretary in the commerce ministry, the Office of the US Trade Representative (USTR) proposed an additional 12.5 per cent tariff on Indian goods.

 

The USTR proposed the extra tariff on India and multiple other economies, citing their alleged failure to stop imports made with forced labour in third countries.

 

The duty will not take effect immediately, as Washington has invited public comments on the proposed tariff action by July 6. The USTR will hold hearings on the matter on July 7.

 

The tariff proposal follows an investigation against the economies under Section 301 of the US Trade Act of 1974, which allows Washington to probe and act against trade practices that it deems harmful to US commerce.

 

Thursday's statement by the commerce department does not mention tariffs linked to Section 301. However, the department had said on Wednesday that India remains engaged with the US on the matter as part of the Section 301 proceedings.

 

Simultaneously, as talks were underway in New Delhi, Sergio Gor, US Ambassador to India and Special Presidential Envoy to South and Central Asia, said at an event in Mumbai on Wednesday that almost 99 per cent of the agreement was already in place.

 

The latest engagement was the second round of negotiations since the two sides issued a joint statement in February agreeing on a framework for an interim agreement regarding reciprocal and mutually beneficial trade.

 

Following February's joint statement, the White House removed the 25 per cent penal tariff on India for its Russian oil imports. Both sides had also agreed to lower the reciprocal tariff on Indian goods to 18 per cent from 25 per cent. However, soon after, the US Supreme Court scrapped the reciprocal tariffs imposed by the White House under the US' International Emergency Economic Powers Act.

 

Since then, the US has levied a temporary baseline tariff of 10 per cent on all trading partners. The proposed tariff of 12.5 per cent is likely to be finalised by July 24, before the baseline duty expires.