US to discuss trade deal with India before Donald Trump's visit

As a precursor to long-term Free Trade Agreement (FTA) between New Delhi and Washington, US Trade Representative Robert Lighthizer will be on India visit to finalise trade deal. Legal vetting of trade deal in currently underway and it will be anunced when US President Donald Trump visits India, likely on February 24.

India has reportedly sought to restore preferential trade status under Generalized System of Preference (GSP), which was terminated by Trump administration last year. According to US Trade Representative, GSP provides opportunities for many of world’s ‘poorest countries’ to use trade to grow ir ecomies and climb out of poverty. 

However, Trump recently commented that United States is also a “developing nation” like India and China, indicating that any relief to India remains doubtful. But a win-win deal for both US and India could improve electoral chances of Trump ahead of 2020 presidential elections and boost India’s ecomic slowdown. Trump has already sealed ‘phase one’ deal with China after months of a tariff war and would be looking to finalise a trade agreement with India. 

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Meeting with Goyal

Lighthizer is likely to meet Commerce and Industry Minister Piyush Goyal during visit after a six-member team from US administration visited New Delhi last week. y met Goyal and or ministers to discuss nuances of trade deal. Lighthizer’s visit comes at a time when India is looking to spur investment and consumption to revive ecomy through Union Budget.

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According to media reports, trade agreement could raise India’s defence and energy purchases from US. While India is expecting partial restoration of preferential trade allowing duty-free exports, New Delhi is reportedly considering to ease pricing caps on medical equipment. India’s refusal to join Regional Comprehensive Ecomic Partnership (RCEP) citing concerns for Indian farmers, MSMEs, and dairy sector has left New Delhi with fewer options in terms of FTA.

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