NEW DELHI: India and the US have thrashed out the contours of a trade pact to be signed during the proposed visit of US President Donald Trump next month which will see India agreeing to cut duties on more than 40 product categories from the US ranging from apples, almonds, up-end mobiles, smart-watches and electronic gadgets in return for the US allowing Indian manufactures duty-free trade facilities withdrawn last year.
Officials said for the US President, the India deal in the pipeline will come on top of the trade deal with China announced on Thursday. “In some ways thought the scope of the China deal is larger, ours will be better,” said commerce ministry officials.
While going ahead with the deal, India is stalling in allowing US dairy products entry by taking the line that while it is open to dairy imports, they have to confirm to restrictions on their not being fed animal food matter.
Apparently animal feed used in the US dairy industry has high protein blood meal from cattle and bovines. India has pointed out that cultural and religious sensitivities will preclude imports from dairy animals fed with such meals. India’s dairy and poultry industry had lobbied hard against opening up these sectors to unrestricted imports.
Similarly, officials said that while duty on US manufactured medical devices could be brought down as part of the `peace formula’, India was sticking to its stand that given the huge numbers of poor patients in India, price caps would continue. The US had termed India’s price caps on heart stents and other medical devices to be discriminatory trade practices.
Since a bilateral investment treaty between India and US has as yet not been finalized, something which the US wanted, India will also come up with a quick dispute resolution system which would safeguard foreign investment. India had allowed most bilateral investment treaties to lapse and then demanded new clauses which allow arbitration in third countries to be resorted to only after exhausting all legal remedies within India. This was opposed to by US and others pointing out that Indian judicial process was long-winding.
India’s foreign secretary-designate Harsh Vardhan Shringla had said in Washington earlier this week, that the two sides were “close to concluding a trade package that would provide enhanced market access to both countries."
Top Commerce Ministry officials said “obviously we have thrashed out the deal otherwise our diplomats would not be working on dates for a possible visit by President Trump.” The Indian view is that deal could be improved upon but will stand.
“In time we will work for a comprehensive economic agreement but that will take a lot of negotiations. Right now we can call it the first phase coming before the US Presidential elections,” they said.