Modest expectations from India-US Trade Policy Forum meeting: Experts

crucial India-US Tre Policy Forum meeting here is unlikely to make much progress, given sharp differences, but would hopefully ignite tre talks between world's two largest democracies, according to eminent tre experts.

Minister of Commerce and Industry Piyush Goyal, who is in US on an official visit, held a series of meetings with CEOs of investment and financial giants in New York on Monday.

He will attend 13th Tre Policy Forum (TPF) meeting being hosted by US Tre Representative Karine Tai in Washington on January 11. Goyal will also hold a bilateral meeting with Tai.

TPF is a platform for continuous engagement between two countries in area of tre and to furr bilateral tre and investment relations. 12th TPF Ministerial was held in New Delhi on November 23, last year after a gap of four years. re was no TPF in 2022.

“re will be some glossing over of serious bilateral tre problems, positive language on architecture of TPF discussions across goods and services, and repackaging of specific areas of agenda, such as labour, environment, and good regulatory practices, as part of a new working group on 'resilient tre',” said Mark Linscott, former assistant US tre representative (USTR) for South and Central Asian Affairs.

But it will be difficult to avoid conclusion that current approach on bilateral tre is not working, noted Linscott. Established in 2005, Tre Policy Forum is leing bilateral mechanism to discuss tre-related matters.

Two possibilities for 2023 could substantially alter dynamics and put tre relationship on a better, healthier course for future, he said.

first would be reauthorisation of US Generalized System of Preferences (GSP) programme by Congress so that two sides could come back to table in TPF with enticements to offer for concluding a wide-ranging tre agreement.

“If United States could offer reinstatement of India’s GSP benefits, prospects are strong that two sides could reach an agreement on a series of issues, covering agriculture, health-sector products, digital services, and new tre issues (e.g., environmental sustainability and more equitable distribution of benefits of tre),” Linscott said.

second would be a reversal of Biden ministration’s allergy to negotiating free tre agreements (FTAs), which has handicapped US in competing in global markets as ir tring partners negotiate preferential tre terms among mselves (India concluded an FTA with United Arab Emirates (UAE) and an interim FTA with Australia in 2022 and is actively negotiating with UK, European Union, and Cana).

playing field has become less level for US export interests as a result, and a more captive US domestic market is neir realistic nor more beneficial, he said.

“While it is unlikely that India would be at top of list for early negotiation of an FTA if Biden ministration changes course ( United Kingdom and Kenya are more likely candidates), even start of an exploratory process for a US-India FTA would kickstart expansion of tre relationship,” he said.

two governments would experience new, exciting dynamics in ir bilateral engagement, more attention from stakeholders on both sides, and enhanced leverage to fix problems and venture into new frontiers on tre, Linscott said.

Kyle Gardner, a nonresident senior fellow at Atlantic Council’s South Asia Center, said, as with last TPF delicious deal on mangoes and cherries, progress in each of focus areas is likely to be incremental.

“This is especially so until Washington has ability to offer GSP benefits to India as an incentive. But re are also broer policy opportunities that neir side should lose sight of, particularly on digital tre and services,” he said.

“Ensuring commitments to cross-border data flow to maximize growth of both countries’ digital economies will have a far bigger impact on long-term tre growth than tit-for-tat tariff reductions," he said.

Gardner said that despite a long list of irritants, re is much to celebrate. As every investor knows, however, past performance is not always indicative of future results.

“Expectations are conspicuously modest from TPF with stakeholders anticipating a summit short on tangible outcomes. sides may be meeting primarily out of recognition of importance of high-level tre dialogue between two responsible cabinet officials,” said Atman Trivedi, who served as Senior Director for Policy in Global Markets at US Commerce Department during Obama ministration.

US and India habitually enter tre discussions from different vantage points that reflect starkly different economic circumstances, tritions, and systems, he said.

“At present and for foreseeable future, neir country is keen to make concessions on tariff and non-tariff barriers,” Trivedi said.

Observing that India-US tre talks have not gained as much traction in Biden ministration as during Biden's predecessor Donald Trump’s tenure when two sides were close to a mini-tre deal, nan Ahm Ansari, a nonresident senior fellow at Atlantic Council’s South Asia Center, said restart of TPF provides an opportunity to change that.

Washington and New Delhi would be wise to use TPF to discuss areas of alignment on inclusive digital tre, as well as potential digital cooperation during India’s G-20 presidency, said Anand Raghuraman, a nonresident fellow at South Asia Center and a director of Global Public Policy at Mastercard.

According to commerce ministry, in 2021-22, bilateral tre between US and India stood at USD 119.42 billion as against USD 80.51 billion in 2020-21.