India and US Trade Agreement: An Overview
The trade relationship between India and the United States has always been a topic of discussion in the global economic landscape. The two countries have engaged in bilateral trade for decades, which has helped foster economic growth and development in both nations. However, an official India and US trade agreement has remained elusive, with negotiations ongoing for several years.
In recent years, there has been renewed interest in the India and US trade relationship, with both countries seeking to bolster their respective economies. The United States is India’s second-largest trading partner, while India is the 9th largest trading partner of the US. Bilateral trade in goods and services between the two countries reached $146.1 billion in 2019, a sizable increase from $118.3 billion in 2017.
The US-India Trade Policy Forum (TPF) was established in 2005 to enhance bilateral trade relations between the two nations. The TPF meets regularly to review trade policies and discuss ways to address market access barriers. The latest meeting, held in 2019, highlighted several areas of focus, including agriculture, digital trade, and intellectual property rights.
One area of contention in the India and US trade relationship has been India’s tariffs on American goods, specifically in the agricultural and manufacturing sectors. The US has been pushing for greater access to the Indian market, with American officials citing the need for a level playing field in trade relations. India, on the other hand, has been seeking greater access to the US market for its pharmaceuticals and IT services.
Efforts to negotiate a full-fledged India and US trade agreement have been ongoing since 2018. The Trump administration had been pushing for a deal with India, citing the growing trade deficit between the two nations. Nonetheless, negotiations were put on hold last year, with India insisting on a limited trade agreement that would cover only a few sectors. The Biden administration has yet to announce its stance on the trade relationship with India.
Another factor that has complicated the India and US trade relationship is the global COVID-19 pandemic. The pandemic has caused disruptions in supply chains and trade flows, leading to a decline in trade between the two nations. However, the ongoing vaccine rollout in both countries and the easing of pandemic-related restrictions could provide new impetus to negotiations.
In conclusion, the India and US trade relationship is an important one for both nations, with significant potential for economic growth and development. Negotiating a comprehensive trade deal that addresses market access barriers and trade imbalances would be a win-win for both countries. As the world begins to emerge from the pandemic, it is likely that both India and the US will renew their efforts to strengthen their trade relationship and explore new areas of cooperation.