Senior trade officials from India and the US will hold a crucial meeting on June 26 to hammer out solutions to contentious trade issues, including the additional duty slapped by the Trump administration on Indian steel and aluminium, that have threatened to escalate into a broader trade war, sources told FE. The US delegation will be led by assistant US trade representative (south and central Asian affairs) Mark Linscott. Both the sides will first try to “address low hanging fruits”, including greater market access for each other’s products, in the meeting and see how to resolve all the crucial issues without further flaring up the situation, said one of the sources.
New Delhi has proposed to impose up to 50% extra duty on 30 American goods, including Harley Davidson bikes, almonds and apples, stung by the US move to slap additional 25% import tariff on steel and 10% on aluminium supplies from a number of countries, including India. It raised a complaint against the US duty at the WTO, seeking retaliation claim to recoup the cost of $241 million levied on its steel and aluminium exports. India’s proposal for retaliation came after its efforts to persuade the US to exempt it from the extra levy on the metals failed to elicit a positive response. The next week’s meeting will lend more clarity as to where both the sides are heading and how serious are both the sides in addressing each other’s concerns.
The decision to convene the meeting was made by both the countries during commerce and industry minister Suresh Prabhu’s visit to the US last week. India has already dragged the US to the WTO over the duty on steel and aluminium recently, having raised objections to massive illegal subsidies by the US in the renewable energy and agriculture sectors. The US has sought to raise a dispute at the WTO against India’s export subsidies, claiming that such sops hurt US workers. Apart from relief on the metal duty, India wants relaxed visa regime for skilled professionals; delinking of a special tariff regime from market access talks, among others.
For its part, the US wants greater market access to reduce its trade imbalance with India; zero import duty on Harley Davidson bikes and removal of price curbs on stents and other medical equipment by New Delhi. US President Donald Trump recently attacked India for its alleged high tariff regime, which, he claimed, is as high as 100% in some cases. India accounted for only 2.8% of the US goods trade deficit of $810 billion in 2017 and occupied the 9th spot in the list of nations with which the Trump administration seeks to pursue a trade balance agenda.
