India, US to explore new trade, investment opportunities ahead of Modi-Biden meeting in White House

India and the United States will this week explore new trade and investment opportunities, with the two sides working on the deliverables for Prime Minister Narendra Modi’s proposed visit to Washington DC on an invitation from President Joe Biden.

Commerce Minister Piyush Goyal is hosting his counterpart in the US Government, Gina Raimondo, in New Delhi this week. Goyal and Raimondo will re-launch the India-US Commercial Dialogue on Friday after a four-year-long hiatus.

Raimondo is the third member of Biden’s Cabinet to visit India in a fortnight. The US Secretary of the Treasury, Janet Yellen, and the Secretary of State, Antony Blinken, earlier had back-to-back visits to Bengaluru and New Delhi respectively.

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Yellen and Blinken came to attend the G20 conclaves hosted by India. But they also had bilateral meetings with their hosts and counterparts – Finance Minister Nirmala Sitharaman and External Affairs Minister S Jaishankar – to discuss deliverables for the visit of the prime minister to Washington DC and his meeting with the US president, tentatively proposed to take place either in June or July this year.

Goyal earlier this year visited Washington DC and had a meeting with the US Trade Representative Katherine Tai. They co-chaired the 13th India-US Trade Policy Forum on January 11 and agreed to look at the “big picture” to boost bilateral commercial relations instead of trying to work out a trade deal.

The meeting between Raimondo and Goyal is also likely to help set the stage for Modi-Biden talks in White House, a source told DH in New Delhi.

The last India-US Commercial Dialogue was held in February 2019. It could not be held due to the Covid-19 pandemic and other factors over the past three years. Goyal and Raimondo will now re-launch the dialogue with strategic focus on supply chain resilience and diversification and new emerging areas, according to an official of the Ministry of Commerce and Industry in New Delhi.

They will also co-chair a session of the India-US CEOs’ Forum, which was soft-launched in November 2022 with focus on enhancing energy security and reducing overall greenhouse gas emissions, advancing inclusive digital trade and facilitating post-pandemic economic recovery, especially for small businesses.

This is an optimistic time for the relations between the US and India, Raimondo said in a statement issued before leaving Washington DC for New Delhi. “Through the CEO Forum, the Commercial Dialogue, and IPEF (Indo-Pacific Economic Framework), we are making excellent progress in bringing our countries closer together by creating new markets for trade, expanding those that already exist, and reinforcing our shared commitment to democracy.”

The US is India’s largest trading partner and the largest export destination. India is the ninth largest trading partner for the US.

The bilateral trade in goods doubled in eight years and surpassed $131 billion in 2022. The total trade in goods and services is expected to cross US$ 180 billion. The US is also the third biggest source of Foreign Direct Investment for India and one of the top five investment destinations for India.

India and the US have been trying to negotiate a trade deal since 2018. The two sides were close to signing one during Prime Minister Narendra Modi’s meeting with the then US President Donald Trump in New York in September 2019, but they could not narrow down differences on certain key issues. A “mini trade deal” with “limited scope” was then expected to be inked after the Trump-Modi meeting in New Delhi on February 25, 2020, but it was also shelved.

Modi had his first in-person meeting with Trump’s successor Joe Biden in Washington D.C. on September 24. 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, which had not been convened since 2017, was finally relaunched in New Delhi in November 2021.