A new chapter in US-India trade relations begins today. A high-level US delegation, including Assistant US Trade Representative for South and Central Asia, Brendan Lynch, is arriving in India for a four-day visit.
New Delhi: A high-level US delegation, including Assistant US Trade Representative for South and Central Asia, Brendan Lynch, is commencing a four-day visit to India, marking a pivotal moment in US-India trade relations. Discussions will center on a proposed Bilateral Trade Agreement (BTA) between the two nations. However, prior to these negotiations, the Global Trade Research Initiative (GTRI) has cautioned India to proceed with caution.
Negotiations Amidst Tariff Disputes – A Challenging Time for India
US President Donald Trump announced reciprocal tariffs effective April 2nd, potentially significantly impacting Indian exports to the US. This could result in additional tariffs ranging from 8% to 33% on agricultural products, meat, automobiles, diamonds, gold, chemicals, and pharmaceuticals. This makes the upcoming negotiations highly sensitive for India.
India has signaled a potential willingness to reduce tariffs on US products, further highlighting the importance of these negotiations. However, regarding the proposed trade agreement, the GTRI has warned India that it could potentially undermine India's sovereignty.
GTRI's Warning – India Must Exercise Caution
Ajay Srivastava, founder of the economic think tank GTRI, stated that the absence of Fast Track Trade Authority in the US means any trade agreement could be altered by the US Congress, creating instability for India. Furthermore, America's certification process allows the US to renegotiate even after signing the agreement. This could pressure India to make changes to its domestic laws, regulatory reforms, and policies.
A Diplomatic Test for India
These negotiations are not merely about trade for India; they represent a test of diplomatic skill. Given the inherent legal complexities in US trade regulations, India must proceed cautiously. GTRI recommends that India should not accept any provisions that compromise its economic and trade sovereignty.
