Wait...
Search Global Export Import Trade Data
Recent Searches: No Recent Searches

Limited deal: Trade pact with US likely to be delayed.


Date: 18-11-2020
Subject: Limited deal: Trade pact with US likely to be delayed
This is even as New Delhi, unenthused about revisiting the China-dominated Regional Comprehensive Economic Partnership (RCEP), seeks to counterbalance any potential damaging effect of the bloc on its foreign trade with bolstered ties with the US and EU, two among its three largest export markets.

If the proposed interim India-US trade agreement is designed to cover barely 15% of the trade between the two countries, Washington seems in no great hurry to clinch even this limited deal. This is even as New Delhi, unenthused about revisiting the China-dominated Regional Comprehensive Economic Partnership (RCEP), seeks to counterbalance any potential damaging effect of the bloc on its foreign trade with bolstered ties with the US and EU, two among its three largest export markets.

The proposed “limited deal” with the US could cover an annual trade of about $13 billion. “The US response to the proposal is still awaited,” a source told FE. With Joseph R Biden’s victory in the American presidential polls, analysts are expecting a further delay in the clinching of the deal, as even some of the settled issues may also be reviewed by the new administration.

Indian officials, however, indicate that New Delhi is willing to wait for a win-win deal for both. 
This deal was to be followed up with bilateral talks for a broader free trade agreement (FTA), the imprerative of which has only risen after the conclusion of the China-dominated Regional Comprehensive Economic Partnership (RCEP) deal on Sunday. The US is India’s largest export destination.

Under the “limited” deal, India was pushing the US for a complete restoration of duty benefits for it under the so-called Generalised System of Preferences (GSP). This will mean duty-free Indian supplies of over $6 billion a year (the tariff forgone for the US was only $240 million in 2018). This deal is expected to be almost evenly balanced in terms of trading value for both the partners.

However, with the new US administration taking over early next year, India may be willing to even expand the coverage of the deal on a reciprocal basis, a source said. In that case, the limited deal may be converted into a preferential trade agreement involving dozens of key products, which will set the stage for an FTA subsequently.

According to the source, India may consider opening up its dairy and poultry sectors partially if it gets a good deal from the US in textiles and garment and pharmaceuticals. In garments, for instance, the US import duties for India currently range between 16.5% and 32%.

As part of the limited deal, India is learnt to have offered to reduce tariffs on high-end bikes like Harley Davidson, extend greater market access in farm products, including cherry, and sweeten its initial offer on easing price caps in medical equipment. India is willing to apply trade margin on coronary stents and knee implants at the first point of sale (price to stockiest), instead of imposing it on the landed prices, as was proposed by it initially, to make it more attractive for American companies like Abott. India is also willing to resolve certain non-tariff measures, such as certification process for some dairy products and market access in alfalfa hay and pork.

However, negotiations on the American demand for India to scrap duties on seven ICT products, including high-end phones and smart watches, are yet to be concluded, said the source. New Delhi had earlier estimated that any such move would mean a potential customs revenue loss of $3.2 billion or more a year.

The US has been pressing India to abolish/cut “not justified” tariff on motorcycles (50%), automobiles (60%) and alcoholic beverages (150%). It is seeking better trade balance with India through greater market access in agriculture and dairy products.

New Delhi has been critical of stringent US patent protection laws and various steps by the Food and Drug Administration (FDA), which have dented India’s exports of pharmacetical products. This is among the important non-tariff barriers that India wants the US to remove.

In Septmeber, commerce and industry minister Piyush Goyal had said US trade representative Robert Lighthizer and he had agreed that “we can look to finalising (the limited deal) before the (US) election, or otherwise soon after the election”.

Analysts have said any US move to rejoin the ambitious Trans-Pacific Partnership (TPP) trade deal with 11 others, which was rejected by the Trump regime, will further pressure India to redraw its trade ties to ensure it’s not left behind in integrating with global supply chain.

However, even if a deal may take some more time now, it’s worth waiting for, analysts say. This is because the Biden administration will likely be more pragamatic and may not view trade ties with countries, especially strategic allies, striclty from the narrow prism of American trade deficit, as Donald Trump did, they add. However, given that Trump has gone too far with protectionist measures through his “America First” policies, it won’t be easy for Biden to unwind them quickly.

Source:-financialexpress.com

Get Sample Now

Which service(s) are you interested in?
 Export Data
 Import Data
 Both
 Buyers
 Suppliers
 Both
OR
 Exim Help
+


What is New?

Date: 28-02-2025
Notification No. 12/2025-CUSTOMS (N.T.)
Fixation of Tariff Value of Edible Oils, Brass Scrap, Areca Nut, Gold and Silver- Reg.

Date: 14-02-2025
Notification No. 10/2025-CUSTOMS (N.T.)
Fixation of Tariff Value of Edible Oils, Brass Scrap, Areca Nut, Gold and Silver- Reg.

Date: 13-02-2025
Notification No. 14/2025-Customs
Seeks to amend Notification 11/2021-Customs dated 01.02.2021 to amend AIDC rate on Bourbon whiskey

Date: 11-02-2025
NOTIFICATION No. 09/2025–Central Tax
Seeks to bring rules 2, 8, 24, 27, 32, 37, 38 of the CGST (Amendment) Rules, 2024 in to force

Date: 03-02-2025
[F. No. CBIC-190354/236/2021-TRU]
Corrigendum to Notification No. 50 of 2024 Customs, dated the 30th December, 2024.

Date: 01-02-2025
Notification No. 13/2025-Customs
Seeks to further amend notification No. 153/94-Customs dated the 13 th July, 1994.

Date: 01-02-2025
Notification No. 12/2025-Customs
Seeks to further amend notification No. 19/2019 dated 06 th July 2019.

Date: 01-02-2025
Notification No. 11/2025 – Customs
Seeks to further amend notification No. 25/2002-Customs, dated the 1st March, 2002 so as to add capital goods to the already existing list of capital goods exempted from basic customs duty for manufacture of lithium-ion battery of mobile phones and electrically operated vehicles.

Date: 01-02-2025
Notification No. 09/2025-Customs
Seeks to further amend notification No. 16/2017-Customs, dated the 20 th April, 2017 so to exempt certain drugs for supply under Patient Assistance Programme run by specified pharmaceutical companies.

Date: 01-02-2025
Notification No. 07/2025-Customs
Seeks to further amend notification No. 11/2018-Customs dated 02 th February, 2018 so as to exempt specified goods from the whole of levy of Social Welfare Surcharge.



Exim Guru Copyright © 1999-2025 Exim Guru. All Rights Reserved.
The information presented on the site is believed to be accurate. However, InfodriveIndia takes no legal responsibilities for the validity of the information.
Please read our Terms of Use and Privacy Policy before you use this Export Import Data Directory.

EximGuru.com

C/o InfodriveIndia Pvt Ltd
F-19, Pocket F, Okhla Phase-I
Okhla Industrial Area
New Delhi - 110020, India
Phone : 011 - 40703001