Piyush Goyal signals India-US trade deal may not be signed before US elections

Trade minister Piyush Goyal on Tuesday hinted that the limited trade package under negotiation between India and the US may be signed only after the American presidential elections in November, even though the deal is nearly ready.

“I just had a conversation with (US trade representative) ambassador (Robert) Lighthizer. We both agreed that we can look at doing it before the election also, but otherwise soon after the election. The entire package is near-ready and can be finalized at any time the local political situation in the US permits them to. I am open to signing it tomorrow what we have agreed upon and I have left it to Bob (Lighthizer) to take a final call,” Goyal said during a webinar organized by the US India Strategic Partnership Forum.

A limited trade package between India and the US is under negotiation since 2018 and is expected to cover tariff-related concessions for the US farm produce, especially dairy items, pricing of pharma products, such as stents and knee implants, and information and communication technology products. In return, Washington is expected to restore benefits accorded to Indian exporters under the Generalized System of Preferences (GSP), which were terminated by the US President Donald Trump. Both sides may also remove the tit-for-tat tariff hikes after the US raised steel and aluminium tariffs on the grounds of national security.

Goyal said both sides lost valuable negotiating time due to the pandemic and lockdown in India. “Ideally, we could have announced it during the visit of the president in late February, but I suspect at that time there were a few dots and commas that still needed to be finalized. And soon thereafter we were all faced with covid. Ambassador Lighthizer was working out of home, we had one of the world’s most severe lockdowns, and I suspect we lost valuable time during that period.”

Goyal said the initial India-US trade deal could lay the foundation for negotiating a much more ambitious bilateral free trade agreement. “The architecture of the initial deal is in the best interest of businesses, both in the US and India. And, it is in the interest of both countries to deepen our strategic partnership with this immediate trade deal also, because it will open the doors to starting a dialogue on a larger bilateral engagement where we have much more elbow room since it is not on an MFN (most favoured nation) basis, and we do hope we can quickly move to the next phase of a larger engagement for a free trade agreement,” he added.