India, US fail to clinch trade deal

India and United States could not finalise a much-waited trade deal on Tuesday even as Prime Minister Narendra Modi had a meeting with American President Donald Trump at the United Nations headquarters in New York.

Though Commerce Minister Piyush Goyal flew to New York to hold talks with US Trade Representative, Robert Lighthizer, and finalize a limited-scope package deal to address mutual concerns on tariffs and other issues, they could not make a breakthrough.

“He (Goyal) has been having discussions with US Trade Representative Lighthizer. Significant progress has been made on number of issues. The two leaders (Modi and Trump) were optimistic (during the meeting) about us reaching a trade agreement in near future,” Foreign Secretary Vijay Gokhale told journalists after the meeting between Prime Minister and US President.

He did not commit a time-line for the negotiation on the trade deal to conclude, but said that both sides were optimistic that an understanding would be reached and agreement would be finalized “fairly soon”.

Trump too said that India and the US would soon have a trade deal. Modi too underlined the positive trajectory of the India-US trade relations and referred to the Memorandum of Understanding (MoU), which Petronet LNG of India recently signed with Tellurian Inc of America The Petronel LNG will invest $ 2.5 billion in Tellurian Inc’s proposed Driftwood LNG export terminal, in exchange for 5 million metric tonne of gas per year for over 40 years.

India lad last week asserted that it did still meet the criteria for the trade concessions the US granted to several developing nations under the Generalized System of Preferences (GSP) programme and the decision of Trump Administration to strip it off the privilege earlier last year had been a unilateral move.

Gokhale had underlined during a news conference in New Delhi last Thursday that the US should also withdraw the tariffs it had unilaterally imposed on import of steel and aluminium from India under the Section 232 of the America's Trade Expansion Act of 1962.

India and the US officials were discussing the possibility of clinching a deal ahead of Prime Minister's meeting with American President, addressing at least some of the trade concerns of both sides. The trade deal, which was being negotiated by the two sides, was expected limited in scope, but would possibly include a US commitment to restore, if not fully, at least partially, the GSP beneficiary status for India and New Delhi’s pledge to withdraw the retaliatory tariff on imports from America.

The US has been complaining about imbalance in its trade with India.

Trump in February 2018 expressed his displeasure over high import duty imposed by India on high-end motorcycles like the ones made by Harley-Davidson and other US companies. During his visit to New Delhi last May, American Secretary of Commerce, Wilbur Ross, pointed out that the US was India's largest export market and accounted for about 20% of its total export. Yet, he added, India was only the 13th largest export market of the US, “due to overly restrictive market access barriers”.

Modi-Trump meeting on the sideline of the G-7 summit at Biarritz in France on August 27 however saw both sides expressing willingness to make efforts to address each other’s trade concerns. Prime Minister conveyed to the US President that India had last year for the first time imported oil and gas worth $ 4.5 billion from America and was keen to buy more this year and the coming years.

The overall India-US bilateral trade in goods and services has increased from $126 billion in 2017 to $142 billion in 2018.