U.S. and India Possible Trade Talks

February 24, 2020

Trump Visits India

President Trump went on a 2-day trip throughout India focusing on the relationship between United States and India. According to DW.com, “New Delhi expects Trump’s visit to facilitate greater synergies between India and the US when dealing with security issues, terrorism and trade.” The article goes on to mention that President Trump and his wife Melania will take part in several ceremonies travelling a portion of the country. One of the events, known as “Namaste Trump,” is located at the world’s largest cricket stadium with a capacity of over 100,000 people. PMO India posts on twitter:

Bilateral Talks

After the events, the president planned to discuss possible bilateral trade with India’s Prime Minister Narendra Modi along with other senior government ministers.

Sumit Ganguly, an India expert and professor of Political Science at the Indiana University Bloomington, told DW, “There is little or no question that apart from the symbolism it [the trip] would underscore the significance that the US attaches to India.” He went on to state, “The visit will also underscore the diminishing significance of Pakistan, as there will be no obligatory passing stopover in Pakistan. It probably also sends a message to China about the importance that the US attaches to India,” he added.

U.S. – India Trade

Some of the issues the United States faces with India include high tariffs on U.S. goods into the country, tough barriers to foreign investment, along with market access to goods and services, among others. Despite the ongoing disagreements, trade between the two countries has continued to grow. For example, “bilateral commerce in both goods and services [soared] from $16 billion (€14.82 billion) in 1999 to $142 billion in 2018,” and according to the White House, since 2017, commerce between the United States and India has increased over 40 percent.

Trade Deal this Year?

Trump recently said the United States and India were working on a major trade deal, but he was not sure if it would be completed before the US presidential election in November. Some reports mention a new trade deal would give U.S. greater access to India’s dairy and agriculture markets and reduce Indian tariffs on a myriad of U.S. products including almonds, chickpeas and motorcycles. However, according to BBC.com, the recent visit was productive, but didn’t harvest a comprehensive trade deal just yet. The articles states, “India and the US have signed defense, energy and telecoms deals but failed to reach a much-talked about trade accord,” however the leaders both hope the visit mends “a rift over tariffs.”

In fact, some agreements that were made during the visit as stated in BBC’s article may include:
• India will buy attack helicopters and other military equipment worth $3 billion
• Mutual cooperation in fighting radical Islamist terrorism
• Deepening energy ties
• Work together to make 5G technology safer
• US firm Exxon Mobil and Indian Oil signed an agreement to help India import more Liquefied Natural Gas (LPG)


According to Aljazeera, “In a deal struck in 2007, India agreed to import Harley Davidsons and, in exchange, the US agreed to allow imports of Indian mangoes. But India continued to impose a 75-percent import tariff on the bikes, bringing that down to 50 percent after Trump raised the issue in 2017. More recently, in a tit-for-tat exchange, the U.S. imposed, in 2018, new tariffs on aluminium and steel imports from several countries, including India. New Delhi responded with a list of retaliatory tariffs, some on imported US almonds, chickpeas and apples, to name but a few, but held off applying them. Soon after, the Trump administration ended preferential tariffs for Indian exports and India responded by implementing the retaliatory tariffs.”

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