Login With Google
India-US Trade Deal Inconclusive
Why is it in the news?
- On the sidelines of bilateral talks between Prime Minister of India and US President, commerce and trade leaders of both the sides failed to bridge the gap in their positions.
More in the news
- The agreement unravelled due to the failure to reach an agreement on Information and communications technology (ICT) products.
- The U.S. has wanted India to eliminate tariffs (20%) on ICT products.
- New Delhi is concerned that this could open up the market to flooding by Chinese technology.
- The U.S. wanted greater access to Indian markets for medical devices, such as stents and knee implants.
- U.S. also wanted market access to dairy products and some of its agricultural products.
Background
- The bilateral relationship between the two countries has deteriorated under the Trump administration.
- US had withdrawn GSP benefits to Indian exporters worth $5.6 billion.
- India imposing retaliatory tariffs on 29 products imported from the US.
- U.S Demands:
(1) Concessions for US farm products, especially dairy items.
(2) Removal of price caps on pharmaceutical products such as stents and knee implants.
(3) Eliminate tariffs on ITC products.
(4) Enforcement of intellectual property provisions for pharmaceutical products.
(5) Relaxation of Indian laws covering e-commerce and digital trade in which Amazon and Walmart have a significant stake.
- India's Demands:
(1) To restore benefits accorded to Indian exporters under the Generalized System of Preferences (GSP).
(2) Additional market access for some agricultural produce such as grapes and pomegranates.
Source
The Hindu, LiveMint.