India’s Cautious Stance Amid Trump’s Tariff Threats and Trade Negotiations
India cautiously responds to Trump’s tariff threats, focusing on ongoing trade deal negotiations aimed at reducing barriers and enhancing trade. Recent meetings highlight efforts to finalize an agreement by fall 2024, balancing India’s interests with US demands to mitigate tariff impacts.
India is exercising caution in response to President Donald Trump’s declaration of potential reciprocal tariffs on international trading partners, anticipated to commence on April 2. The Indian government reiterated its commitment to negotiating a multi-sector trade agreement aimed at addressing tariff and non-tariff obstacles while fostering improved market access. The official statement from the Ministry of External Affairs did not specify India’s course of action should Trump proceed with the tariff imposition.
During Prime Minister Narendra Modi’s visit to the United States in February, India and the US agreed to engage in discussions regarding a comprehensive bilateral trade agreement. Commerce Minister Piyush Goyal traveled to Washington from March 4 to 6 to meet with his counterparts and advance discussions about this proposed deal, which is expected to see initial outcomes by this fall.
Jaiswal emphasized the ongoing dialogue between the two nations, which aims to bolster bilateral trade in goods and services, enhance market access, minimize barriers, and facilitate supply chain integration. Goyal’s meetings addressed tariffs, among other pertinent issues. Jaiswal conveyed optimism about the progression of negotiations, indicating that both parties are eager to continue discussions.
India hopes that these negotiations will provide a pathway to circumvent Trump’s proposed tariffs. Sources familiar with the discussions indicated that India is considering reducing tariffs on certain US-demanded goods, particularly in the automobile and agriculture sectors, while protecting local farmer interests. However, there remains uncertainty if mutual consensus can be reached before the April deadline.
A joint communiqué from Modi and Trump outlined a deadline for finalizing the initial phase of trade discussions by fall, with an ambition of doubling bilateral trade to $500 billion by the year 2030. Trump, during a recent address to Congress, characterized India among several entities imposing higher tariffs than the US, driving his desire for reciprocal tariffs to rectify perceived trade imbalances.
In terms of trade volume, the US estimated its total trade in goods with India at $129.2 billion for 2024, comprising $41.8 billion in exports to India and $87.4 billion in imports from India. The trade deficit of $45.7 billion with India is significantly less than deficits incurred with other major partners such as China and Mexico.
In summary, India’s cautious approach towards President Trump’s tariff threats aligns with ongoing negotiations for a bilateral trade agreement aimed at enhancing market access and reducing trade barriers. The commitment to fostering cooperative trade relations remains a priority as both nations work towards achieving a mutually beneficial outcome before the impending deadline.
Original Source: www.hindustantimes.com
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