With no significant movement on the India-U.S. trade negotiations yet, officials are considering taking even a modest trade deal off the table when U.S. President Donald Trump visits India on February 24-25, sources privy to the talks said. As The Hindu had reported on Friday, U.S. Trade Representative Robert Lightizer was due to visit New Delhi last week, but put off the visit when it appeared there was not enough progress in the talks, that appear to have run into trouble over market access for agricultural products including dairy, liberalising e-commerce, and investment norms for retail, as well as India’s push for a full reinstatement of its GSP (Generalised System of Preferences) status that the U.S. revoked last June.
Mr. Lightizer and Commerce Minister Piyush Goyal have not spoken since last Thursday, it is learnt, and after another unsuccessful attempt to reschedule Mr. Lightizer’s visit over the weekend, officials are beginning to feel that time may be running out to wrap up negotiations in time for the presidential visit.
Met three times
However, officials on both sides have confirmed that there has been a narrowing of differences on as many as 25 of about 30 issues, as USTR officials have met with Commerce Ministry negotiators three times in the past month, and their talks could be picked up after the President’s visit. In addition, said the sources, if there is enough political backing for a trade deal of some sort, Mr. Trump, who said last week that he was keen on signing the “right deal” with India, could include Mr. Lightizer as a part of his delegation to try and make a broad announcement.
‘Lincoln House’ sale
Another issue that has eluded resolution despite talks for more than two years concerns the U.S. embassy’s sale of “Lincoln House”, its previous Consulate Building in Mumbai, that was sold for a record bid of ₹750 crore to a businessman in 2015. However, the property is on a long term lease from the Ministry of Defence, which has yet to clear the transfer of the property, thus holding up the payment for the Embassy. Officials had hoped to have this issue, which incurs U.S. Congressional oversight, cleared before Mr. Trump’s visit as well, but have made no headway yet.
Over nearly two years of trade negotiations, that began after the U.S. first announced it would review India’s GSP status, officials on both sides concede that all the issues have been discussed “threadbare.” Despite a similar push for a “mini-trade deal” to be announced when Prime Minister Narendra Modi visited the U.S. in September last year, they have been unable to cross the final hurdles for even a modest announcement thus far. Both India and the U.S. have accused the other of “changing goalposts” during the negotiation, as India has regarded U.S. tariffs on Steel and aluminium and the GSP decision as an act of bad faith while negotiations were ongoing. The U.S. has been similarly upset over new tariffs announced by India, including in the last Budget as well as changes in the IT and data localisation laws. Industry watchers also see the now-stalled negotiations as a game of brinkmanship, where the visit of President Trump has been used as “leverage” to pressure the other side into agreeing to a deal in time.