“Diversifying energy sourcing, keeping with objective market conditions and evolving international dynamics is a key strategy. All of India’s actions are taken with this in mind,” the minister said in his statement on the IndiaUS trade agreement. Both sides would now work towards completing the technical details and finalising the paperwork for the trade deal so as to expeditiously unlock its potential, Goyal informed Parliament.
Differences Resolved
“The detailed contours of the agreement will be announced shortly after completion of these processes,” he said. Goyal didn’t give a timeline for implementation of the deal. The trade agreement won’t offer duty concessions to dairy, meat, poultry, cereals, genetically modified foods, soyameal, and maize imports from the US. “Given the significant and varied interests of the two sides, it is natural that both sides would want to ensure the best possible outcome while safeguarding critical and sensitive sectors in their respective economies,” he said.
Prime Minister Narendra Modi and US president Donald Trump on Monday announced the trade deal, preceded by long-drawn negotiations and also marred by Trump’s decision to slap 50% tariffs on several Indian goods last August. The US has cut reciprocal tariff on Indian goods to 18% from 25%, as part of the deal. It also dropped a 25% penal tariff for India’s purchases of Russian oil. Terming it as a “landmark framework agreement”, Goyal said India and the US have been engaged in regular discussions, and at various levels with the objective of concluding a balanced and mutually beneficial bilateral trade agreement.
“This framework understanding with the largest economy of the world, one that will continue to power global growth and innovation for years to come, is in the larger national interests of the people of India,” said Goyal. “It empowers both Viksit Bharat and Atmanirbhar Bharat.” The tariff on India is among the lowest as compared to its competitor nations, and the agreement also provides significant comparative advantage to Indian exporters, particularly in labour-intensive sectors and manufacturing.
Long-Drawn NegotiationsFollowing negotiations extending to nearly a year, teams from both sides were able to narrow their differences significantly and finalise several areas of the agreement. “India’s core sensitivities in food and agriculture have been fully safeguarded,” Goyal said, adDifferences Resolved ding that the pact would unlock new opportunities for MSMEs, entrepreneurs, skilled workers, and industry, besides enabling access to advanced technologies. This, he said, would support Make in India, Design in India, and Innovate in India for the world, and will make India self-reliant.
India will buy $500 billion of US energy, technology, agricultural goods, coking coal, and many other products over a period of five years. “In so far as references to sourcing from the US are concerned, India and the US are largely complementary economies,” said Goyal.
As India proceeds on the path to Viksit Bharat or a developed nation by 2047, he said the country will need to grow its capacities enormously in multiple sectors, including energy, aviation, data centres, and nuclear power. “The US is a world leader in these areas, and it is natural therefore for us to focus on the trade potential in these sectors, which will lead to an expansion not only in our sourcing but also in our own exports,” said Goyal.