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India-US trade talks end without major progress: Sources

Reuters NEW DELHI | Updated on July 12, 2019 Published on July 12, 2019

US and Indian trade negotiators ended talks on Friday without making major progress on a range of disputes over tariffs and other protectionist measures imposed by both sides that are straining bilateral ties, according to officials with knowledge of the discussions.

Many of the toughest questions on agricultural commodities, e-commerce, and steel and aluminium, have been put off until Indian Commerce and Industry Minister Piyush Goyal goes to Washington for talks with United States Trade Representative Robert Lighthizer next month. The dates for that trip are yet to be settled.

“No breakthrough,” said one of the senior Indian officials involved in the talks in New Delhi that went on for a little over three hours. He declined to make any further comment.

Two other Indian officials said they hoped that some of the issues will be resolved when Goyal goes to Washington. “Friday's talks were more about understanding each other's positions in various disputes,” they said.

There was no official statement issued by either country by early Friday evening.

The two sides resumed talks after US President Donald Trump and Prime Minister Narendra Modi met on the sidelines of the G20 summit in June where they agreed to seek to deepen the two countries' relationship.

Trump said at that summit that there would be a “very big trade deal” with India, though he set no timeline, and has only this week used Twitter to attack what he says are high Indian tariffs on American goods as “unacceptable”.

Tit-for-tat tariffs

“The US sought the rollback of Indian tariffs imposed on some agricultural products, such as almonds, when the two sides met on Friday,” said one of the Indian government sources.

Those tariffs were imposed by the Indian government in response to the Trump administration's decision to remove trade privileges from Indian products under the Generalised System of Preferences. India has asked for those privileges, effectively zero tariffs on a range of Indian products entering the United States, to be reinstated.

“India did not commit to any changes to foreign investment rules for foreign e-commerce firms such as Walmart's Flipkart and Amazon,” one of the Indian sources said. The rules have forced the two American companies to rework their business strategies for India.

One concern now among Indian policy makers is that the Trump administration may push for a free trade agreement with India that could dent India's competitiveness, lead to a flurry of imports and hurt Modi's “Make in India” plan.

In a recent meeting, Foreign Minister Subrahmanyam Jaishankar told trade ministry officials that “Trump is clearly preparing for a larger game, a larger opening,” according to one of the officials aware of the discussions.

Published on July 12, 2019

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