January 10, 2023
In an article for the Atlantic Council, Atman Trivedi posits that the U.S.-India Trade Policy Forum is likely to be short on tangible outcomes. He writes:
“Expectations are conspicuously modest for the TPF with stakeholders anticipating a summit short on tangible outcomes. The sides may be meeting primarily out of recognition of the importance of high-level trade dialogue between the two responsible cabinet officials.
The United States and India habitually enter trade discussions from different vantage points that reflect starkly different economic circumstances, traditions, and systems. At present and for the foreseeable future, neither country is keen to make concessions on tariff and non-tariff barriers.
With far lower average tariff rates and fewer non-tariff barriers, the United States often starts this conversation from a position of less positive leverage. Washington’s stockpile of carrots has shrunk even further given the expiry of the congressional statute authorizing preferential tariff treatment to qualifying developing countries. Current President Joseph R. Biden’s predecessor had revoked India’s status under the GSP program, and so US trade negotiators could theoretically use the prospect of reinstatement to secure Indian compromises. However, Congress was unable to reauthorize GSP benefits for India in the ”lame duck” session last fall.
Those searching for a silver-lining can hope the ministerial will inject new momentum into bilateral trade discussions for when the GSP is back in play. Ambassador and US Trade Representative Katherine Tai and Indian Minister of Commerce and Industry Piyush Goyal are thought to enjoy a good rapport. A positive and constructive session would be welcome in advance of India hosting the next round of Indo-Pacific Economic Framework negotiations on February 8-11. Those discussions will center on supply chains, clean economy, and fair economy, but not market access. India opted not to join IPEF’s trade pillar last September but signed-up for the other trade-adjacent topics.”
Read the article here.