NEW DELHI: Ahead of Prime Minister Narendra Modi’s visit to the US next week, Indian officials are putting together offers to try and smoke the peace pipe with that country, which is engaged in a tit-for-tat trade war with India.
According to top commerce ministry officials, India is willing to cut import duty on high-end automobiles, mobile phones and other high-value products the US is interested in, besides easing rules to allow entry of US agricultural products into Indian market.
During Modi’s visit, India will seek restoration of the preferential tariff treatment the US earlier used to give to more than 2,000 products (worth over $6 billion) that India had been exporting to America, and seek assurances on favourable terms for services trade.
The officials said that India will also offer to withdraw higher tariffs it imposed on 28 US goods as a retaliatory move.
However, they admit that the US holds most cards in the negotiations, as it is now India’s largest trade partner with two-way trade pegged at $87.9 billion in 2018-19, with a $16.9 billion surplus in India’s favour. Total trade in merchandise and services between the two countries stands at $142.1 billion.
While officials said they were willing to discuss any offer of a free trade pact between the two allies, they also felt it would be premature to go ahead with one at this stage. Several American business groups have mooted an Indo-US free trade pact as a way of improving trade ties between the two nations, which were soured by tit-for-tat tariff moves and US President Donald Trump’s rhetoric against Indian trade practices. “Free trade pact is one way to achieve the goal of two-way trade of $500 billion between the two nations by 2024,” said Swapan Sarkar, president, Indo-American Chamber of Commerce.