National

US-India trade dialogue may be discontinued

Nayanima Basu New Delhi | Updated on January 12, 2018

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Narenda Modi

Donald Trump

Officials of the Trump regime believe talks have not yielded tangible results



The Donald Trump administration may discontinue the much touted ‘US-India Strategic and Commercial Dialogue’ (S&CD) that was launched by both sides in 2015 to push forward a host of bilateral issues ranging from economic growth to rules-based global order.

The idea to initiate the S&CD was mooted during the visit of former US President Barack Obama to India in January 2015 with the objective of strengthening economic engagement by ironing out issues through a dialogue mechanism under the two tracks —strategic and commercial. It was decided that the S&CD will be held on a yearly basis taking place alternately in US and India.

“The S&CD may be undone as the Trump administration is undoing a lot of initiatives taken by the Obama administration. Officials in present administration believe that the S&CD has not yielded much tangible results,” a top official told BusinessLine.

Prime Minister Narendra Modi is expected to urge the US President to continue the dialogue mechanism, albeit in a different framework, sources said.

The first round of S&CD took place in September 23, 2015 in the US, followed by the second session that was held on August 30, last year in New Delhi.

“The conversation between the Prime Minister and the US President itself will give the new direction and will set the priorities and perhaps it will be logical to think of further discussions and further dialogues on strategic and other bilateral matters of importance following from and flowing from that broad direction which the two leaders give,” said Gopal Baglay, Spokesperson, Ministry of External Affairs,

During the last round of S&CD, US had stressed on the need to conclude the Bilateral Investment Treaty (BIT) at the earliest for the benefit of American firms which are planning to invest in India. US has said it has several objections to India’s draft BIT model and have asked for negotiations to be expedited. But no negotiations have taken place since October last year.

India, on the other side, pushed US for its membership at the Asia-Pacific Economic Cooperation (APEC), a premium regional forum promoting trade, investment and other linkages among economies of the Asia-Pacific region. While the US has assured its support verbally, India is still in a waiting mode.

As a result, the S&CD has not proved to be much useful in both these cases.

The S&CD also includes other issues such as infrastructure and smart cities, ease of doing business, entrepreneurship and standards. US and India had decided to develop three cities — Ajmer, Allahabad and Visakhapatnam — but progress on this also remains lacklustre, diplomatic sources said.

“India has to understand that the Trump administration believes in tangible outcomes. He needs to show that his administration generates investments and jobs. Whether the S&CD continues or not, India has to see that the US market does not shrink for us. The Prime Minister may well project his ‘Make in India’ programme as a tool to generate jobs there,” said Nandan Unnikrishnan, Vice-President, Observer Research Foundation, a think-tank.

Published on June 19, 2017

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