After consulting various departments such as IT and Agriculture, The Commerce Ministry has made an offer to the US to resolve trade issues between the two nations, Union Commerce and Industry Minister Suresh Prabhu said Wednesday.
“We have consulted all the ministries and we have given them an offer,” Prabhu told PTI in an interview when asked about the measures being taken to resolve trade issues with the US. However, Prabhu did not disclose the details of the offer.
The US is demanding greater market access for its agricultural, dairy products and medical devices, in addition to seeking reduction in import duties on certain IT products and increasing their exports to lower the trade deficit with India.
Prabhu said whatever the US is asking from India is concerned with different ministries, including information technology and agriculture.
While officials from both nations are negotiating for a trade package, the US last month announced it will withdraw benefits provided to Indian exports under its Generalised System of Preferences (GSP) programme.
The US decision to scrap the preferential trade benefit under the GSP after 60 days will impact India’s exports worth $5.6 billion to the world’s largest economy.
Prabhu told PTI that in the last one year, US exports to India have risen by about 48 per cent and it does not include defence purchases made. He added that India plans to buy about 1,000 aircrafts from various countries and the US may be a potential supplier.
“Defence purchases and this kind of procurement is going to change the things dramatically with regard to trade balance,” the minister said.
The trade balance, meanwhile, is in favour of India. In 2017-18, India’s exports to the US stood at $47.9 billion, while imports were $26.7 billion.
When asked about the government’s plan to send an official delegation to the US for holding consultations, Prabhu said, “We have not yet decided”.
Trade analysts believe that dialogue will help in resolving key issues as US is one of the largest trading partners of India. The US is one of the few nations with which India has a trade surplus.
As part of the proposed trade package, India is pushing for exemption from the high tariff imposed by the US on certain steel and aluminium products, resumption of export benefits to certain domestic products under their GSP, greater market access for its products from agriculture, automobile, automobile components and engineering sectors.
When questioned why the deadline for imposing retaliatory tariffs on 29 US products is being extended again and again, Prabhu said the US has not yet stopped the GSP benefits to Indian exporters.
The Centre has extended till May 2 the deadline for imposing retaliatory customs duties on various products, including almond, walnut and pulses.—WITH PTI