Home >Politics >Policy >India, US to review ties during John Kerry’s visit

Senior officials from India and the US will review the progress made in bilateral ties at the second India-US Strategic and Commercial Dialogue on Tuesday in New Delhi, amid growing differences.

In January 2015, President Barack Obama and Prime Minister Narendra Modi elevated the existing India-US Strategic Dialogue to the strategic and commercial dialogue (S&CD) to reflect the growing significance of the bilateral economic relationship. This is the first time the S&CD will be held in India.

The meeting will be co-chaired by external affairs minister Sushma Swaraj and commerce and industry minister Nirmala Sitharaman from the Indian side. The US delegation will be led by secretary of state John Kerry and secretary of commerce Penny Pritzker.

In her meeting with finance minister Arun Jaitley, Pritzker on Monday hoped the goods and services tax, which was cleared by Parliament earlier this month, will boost economic activity in India. She suggested the trade dialogue by the state chief ministers with the different US authorities can be given a structured shape in order to give impetus to the bilateral trade.

Two co-chairs of CEOs Forum, Cyrus Mistry, chairman of Tata group from the Indian side, and Dave Cote, chairman and CEO of Honeywell International from the US, would also be present at the S&CD plenary.

The first S&CD plenary was held in September 2015 in Washington DC and identified the focus areas of cooperation under the two tracks—strategic and commercial. “The current S&CD would be reviewing the progress made so far in strengthening the agreed upon issues and lay down the road map for the ensuing year, under the two tracks," a commerce ministry statement said.

After consecutively losing two cases to the US at the World Trade Organization (WTO) on India’s ban on US poultry imports claiming bird flu fears and a subsidy programme for local solar panel makers in June last year and January this year, respectively, India took the US to the WTO over Washington’s allegedly trade-restrictive measures by hiking professional visa fees, which, though not targeted only against India, ends up affecting mostly Indian software professionals. India has been resisting the move for the last few years.

So far, the US has raised six trade disputes at the WTO against India and faced eight cases from New Delhi.

India’s decision to drag the US to WTO on the higher visa fee row came days after it lost the solar panel case at the WTO in February. As a first step to resolving the dispute on visa fees, India asked the US to enter into what are called Article IV consultations under the dispute settlement understanding. If the two sides fail to arrive at an amicable agreement during the Article IV consultations, India could ask for the establishment of a dispute settlement panel to adjudicate the issue.

The CEO Forum, during its meetings held in January 2015 and September 2015, submitted comprehensive recommendations covering issues across sectors. In line with the CEO Forum recommendations to boost the renewable energy sector, the two sides are working on the US-India Energy Finance Initiatives, which is expected to mobilize as much as $400 million by 2020.

The CEO Forum will also review the status of the action taken on the recommendations submitted by the forum in its two meetings held in 2015 and make fresh recommendations for further expanding trade and investment between both the countries.

The two sides had agreed on four work streams to facilitate economic development initiatives, namely, (a) infrastructure collaboration and smart cities, (b) ease of doing business, (c) innovation and entrepreneurship and (d) standards. The talks are expected to take place regarding smart city master planning activities for three cities for which the memorandum of understanding has been signed between India and the US. They are Ajmer, Allahabad and Visakhapatnam.

Similarly, both sides are expected to discuss the possibilities for collaboration in innovation and entrepreneurship and also exchange information and best practices relating to improving ease of doing business. The collaboration between the National Physical Laboratory and the Bureau of Indian Standards on the Indian side and the National Institute of Standards and Technology on the US side relating to reference material production (RMP), metrological standards, physical and mechanical standards which are crucial to ensure adherence to international quality requirements for a range of products.

The strategic and commercial dialogue is one of the last big interactions between the Indian and the US governments before the end of the Obama presidency. Obama is expected to step down in January at the end of a two-year term.

Another interaction expected between the Indian and the US governments this week is the meeting between defence minister Manohar Parikkar and US defence secretary Ashton Carter. Parikkar is to visit the US and the two countries could sign the logistics support agreement—that will give each access to logistics support from the other besides refuelling and berthing facilities—during the visit.

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