Rethinking an India-US trade deal |
The India-US Interim Agreement for trade is back in the spotlight. Sergio Gor, the US Ambassador to India, has said that the deal is 99 per cent complete. Officials are ironing out a few issues and are reportedly finalising the deal during June 1-4.
On February 6, both countries had issued a joint statement announcing that they had reached a framework under which the US would reduce reciprocal tariffs on India from 25 per cent to 18 per cent, while India had committed to reducing or eliminating tariffs on most US agricultural and industrial exports. As part of the Bilateral Trade Agreement, India may also be required to align its economic policies and laws, including those in the digital sector and intellectual property rights, with US interests. Much, however, has changed over the past four months.
On February 20, the US Supreme Court declared reciprocal tariffs to be illegal, thereby undermining the basis for the 18 per cent reciprocal tariffs. Subsequently, the US imposed 10 per cent tariffs across the board on most countries. As these tariffs are due to lapse on July 24, the US has already........