Announcement on India-US trade pact has lifted business confidence: Goyal

The recent agreement to seal a bilateral trade agreement with the United States (US) has given "confidence and a lot of relief" to businesses, as both sides will be able to work together with each other’s competitive strengths, commerce and industry minister Piyush Goyal said on Sunday.

 

“What the Prime Minister has brought back with him is an agreement, or an understanding, to enter into a trade deal by fall of this year, I think, gives a lot of confidence and a lot of relief to every businessperson in the United States and India who believe that together, we can truly transform world trade with our competitive strengths in different areas,” Goyal said at the ET Now Business Global Summit.

 

 

Prime Minister Narendra Modi and US President Donald Trump on Thursday agreed to begin negotiations and finalise a "mutually beneficial" bilateral trade agreement (BTA) within the next seven to eight months.

 

Both countries will hold talks to increase market access, reduce tariff and non-tariff barriers, and deepen supply chain integration. The proposed trade deal will align with the "bold new goal" set by Modi and Trump to more than double bilateral trade to $500 billion by 2030.

 

These announcements were made after Modi’s first bilateral meeting with Trump since the latter took charge as President of the US on January 20.

 

The decision to forge a trade deal is a crucial development, considering that the US is India’s largest trade partner and a key strategic partner. Besides, over the next few months, Trump is set to roll out a plan to impose "reciprocal" tariffs on US trading partners to narrow its "large and persistent" annual trade deficit in goods and tackle other "unfair and unbalanced aspects" of trade.

 

However, even as Trump and Modi have announced their intention to seal a bilateral trade agreement, the US President has made it clear that Washington will not spare India from reciprocal tariffs.

 

Goyal further said that India has been able to ensure a successful future for its international trade by forging new partnerships across the globe, along with new free trade agreements (FTAs) with developed countries such as Australia, United Arab Emirates (UAE), Switzerland, Iceland, Norway, and Liechtenstein.

 

“The progress we are making in other engagements with Europe, and the progress we will soon make with the United States as we proceed to finalise a trade deal by fall of this year, are all reflective of India's growing relevance on the global stage,” Goyal said.

 

These developments came at a time when the world is struggling with significant trade disturbances, he said, adding that Prime Minister Narendra Modi was the first leader of a large economy to be invited to the White House.