After weeks of speculation, it is now clear that no trade deal would be signed during US president Donald Trump's first visit to India next week. However, during negotiations, Prime Minister Narendra Modi and Trump are likely to make a commitment to a comprehensive Free Trade Agreement (FTA).
A senior diplomat privy to trade negotiations said, "We do not want to rush into a trade deal during this visit. Any deal between India and the US will have a long-term impact. We would rather look to the future and seek win-win solutions".
India and the US have been negotiating a trade pact for over a year now and sources say that United Stated Trade Representative (USTR) Robert Lighthizer and commerce minister Piyush Goyal have developed a good understanding.
Sources confirmed that in the ongoing negotiations, India has asked for the restoration of Generalised System of Preferences (GSP) benefits and greater market access for Indian products. India has also offered tariff concessions on Harley Davidson motorcycles as part of the trade talks.
Reacting to Trump's remarks about unfair treatment, a source said, "Our tariffs are not higher than other developing countries. Countries such as South Korea and Japan have higher tariffs. India is a developing country which will have other requirements."
Defence pacts likely
India and the US could sign a deal worth $2.6 billion for 24 MH60 Rome multi-mission helicopters for the Indian Navy. At least 8-10 deals including a $1.8 billion deal for NASAM air defence system for Delhi and a $930-million deal for six Apache attack helicopters for the Indian Air Force are also in the final stages of negotiations. "These deals are part of ongoing talks and cannot be linked to the outcome of the visit. However, some of them like the deal for navy helicopters may come through during the visit," said a source.
Trump would arrive in India with a large delegation that includes Lighthizer, US Secretary of Commerce Wilbur Ross, US treasury secretary Steven Mnuchin, White House Chief of Staff Mick Mulvaney and Senior Advisor to the President Jared Kushner. Trump would be in India for only 36 hours.
While addressing the media ahead of Trump’s visit, India's Foreign Secretary Harshvardhan Shringla said: "The US is India’s largest trading partner in goods and services combined, and the overall bilateral trade increased by over 10 percent per annum over the past two years to reach $142 billion in 2018; it is expected to cross $150 billion for the first time this year." Hydrocarbon imports from the US have risen to $7 billion in the last two years. The US is India's sixth-largest source of crude oil imports.
President Donald Trump and First Lady Melania Trump would receive a grand welcome at Ahmedabad and the 22-minute-long roadshow to the Motera stadium would be full of cultural performances. "As many as 28 stages representing the various parts of the country are being set up along the route, in what is being called the India Road Show. The route will also feature decorations depicting different events in the life of Gandhiji," the foreign secretary said.
Sources told CNBC TV18 that India and the US will sign a joint vision document that will guide relations in the months to come but there will be no deals or agreements signed during the visit.
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Updated Date: Feb 22, 2020 19:29:25 IST