India and the United States could not make much headway in resolving the mutual trade concerns during Prime Minister Narendra Modi’s meeting with President Joe Biden in Washington last week, apart from agreeing to reconvene the Trade Policy Forum by the end of the current year.
Modi did stress on the importance of trade in India-US bilateral relations in his opening remarks at the meeting with Biden in White House. The meeting however ended without any specific assurance from the US on early restoration of the Generalised System of Preferences (GSP) trade privilege for India or for greater market access for India in the US.
The Biden Administration maintained that the US was no longer willing to negotiate a trade deal with India.
A source in New Delhi said that Modi government might no longer ask the US for early restoration of the GSP trade privilege for India. The privilege was withdrawn by Biden’s predecessor President Donald Trump’s administration in June 2019 and India had been prodding the US to restore it.
The source said that New Delhi would now rather focus on greater market access for India in the US, particularly for the automobile, engineering and agricultural products.
The Biden Administration too had been asking New Delhi to make it easier for the US companies to do business in India.
But the joint statement issued after Modi-Biden meeting at the White House did not indicate any breakthrough in the talks between the two sides, neither on GSP restoration nor on greater market access for Indian and the US companies in each other’s markets.
They agreed to reconvene the India-US Trade Policy Forum before the end of 2021, to “enhance the bilateral trade relationship by addressing trade concerns, identifying specific areas for increased engagement and developing an ambitious, shared vision for the future of the trade relationship”. The Trade Policy Forum had not been convened since 2017, as the erstwhile Trump Administration had not been interested in managing bilateral trade issues through the forum.
The source told the DH that Modi-Biden agreement to reconvene the Trade Policy Forum indicated that the two sides would like to restart engagement to resolve issues, even if the meeting between the two leaders had not achieved any breakthrough immediately.
Modi and Biden also agreed that the US-India CEO Forum and the Commercial Dialogue would be convened in early 2022, leveraging the talents of the private sector. They noted ongoing negotiations on an Investment Incentive Agreement that would facilitate investment in development projects and committed to an early conclusion.
A trade deal was expected to be signed after Modi-Trump meeting in New York on September 24, 2019, but the could not narrow differences and the deal was not signed. A “mini trade deal” with “limited scope” was then expected to be inked after the Modi-Trump meeting in New Delhi on February 25, but it was also shelved.
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