Delegation Heads to Washington for Vital Recalibration Talks

New Delhi: The Indian delegation will visit Washington next week to hold a three-day trade talks with US authorities in Washington, starting from April 20. The bilateral meeting between the key officials in both the countries is expected to hold immense importance as India and the US have finalised the framework for an interim trade agreement, an official source said on Wednesday.The development comes just a day after Prime Minister Narendra Modi and US President Donald Trump spoke over the phone for around 40 minutes amid tensions in the West Asia conflicts. The upcoming discussions are expected to play a decisive role in shaping the first phase of the India-US trade pact, which has been under negotiation for months. As per an official source, chief negotiators of India and the US will begin the three-day talks on the proposed trade pact, as the agreement finalised in February requires recalibration in view of changes in the US tariff landscape. “There is a need for further discussions and follow-up engagements on the pact. Indian team led by chief negotiator Darpan Jain will be visiting the US from 20th of this month. The negotiating teams will be meeting in person after a gap of about 3-4 months. We are looking at finalising the legal agreement, which is a logical follow-up of the joint statement released on February 7,” commerce secretary Rajesh Agrawal said. However, officials also said that the next week’s meeting is also important as the USA is undertaking two investigations under Section 301. On March 12, the United States Trade Representative (USTR) launched a Section 301 probe, covering 60 economies, including India and China. The investigations will determine whether acts, policies, and practices of each of these economies related to the failure to impose and effectively enforce a ban on the importation of goods produced with forced labour are unreasonable or discriminatory, and burden or restrict US commerce. “The two Section 301 investigations launched by the US last month against a host of countries, including India, will also be discussed during the meeting. Both sides will sit together and discuss how these issues need to be structured and addressed. India and the US will work together to finalise timelines and next steps as part of the ongoing engagement,” Agrawal said. As far as the trade deal between India and the US is concerned, both the countries announced finalisation of a framework for the first phase of the bilateral trade agreement in February. According to that framework, the US had agreed to reduce tariffs on India to 18 per cent. However, the tariff architecture in the US has changed following its Supreme Court ruling against President Donald Trump’s sweeping reciprocal tariffs. After that, the US President imposed 10 per cent tariffs on all countries for 150 days from February 24. In light of these changes, the meeting between the chief negotiators of India and the US scheduled in February was postponed. Further, when India finalised the deal, it was at a comparative advantage compared to its competitor countries. Now, all the US trading partners are facing the same 10 per cent tariffs. The interim pact now requires recalibration. The February agreement was negotiated as Indian goods were facing 25 per cent reciprocal tariffs under the International Emergency Economic Powers Act (IEEPA) of the US. Now the American Supreme Court has struck down those levies. “So the agreement will have to be recalibrated, redrafted,” a government official said, adding, that amount of change will take place from their side. “In our case, since the agreement has not been signed, we have got the option where we can right now change whatever needs to be changed,” the official said, adding that as the circumstances have changed, every country is engaging with the US to see what is going to be the nature of their agreements.



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