India-US Trade Talks Near Framework Agreement; Tariffs to be Reversed

India and the US are very close to a framework agreement that will see reversal of the reciprocal and penal tariffs on Indian exports and the pact could be completed in a short period of time, Commerce Secretary Rajesh Agrawal said Monday. He, however, refused to put a time frame to the agreement. “We remain engaged with the US very positively and with a very positive intent to see if we can close it earlier than later.” The total additional tariffs that the US has imposed on India are 50%. Last week a delegation led by Deputy US Trade Representative Rick Switzer was in India for meetings on December 10-11. The visit was largely to familiarise the Deputy USTR who had just taken over with India and its priorities. “At the meetings we also took stock of our trade, our trade relationship, but also the stage at which we are in terms of the negotiations both for the Bilateral Trade Agreement (BTA) and framework agreement,” Agrawal said. Apart from meeting with Agrawal, Switzer also met Commerce and Industry Minister Piyush Goyal and Foreign Secretary Vikram Misri. A team from the European Union (EU) led by its trade commissioner was also in New Delhi from December 3-9 as both sides work to wrap up their discussions by the end of this year. “We had a very deep engagement of all issues and we are narrowing down the differences (With EU). I think every day my team and their team are engaged on some or other issue, I am also engaged at my level, chief negotiator is involved at his level, so I think these discussions are now on a regular basis,” Agrawal added. He said in the discussions with the EU the issue of carbon tax that it will start collecting on import of some select commodities like cement, steel, aluminium and fertilizers under the Carbon Border Adjustment Mechanism (CBAM) is also on the table in the negotiations on FTA. The carbon tax that will be collected from January 1 on carbon emissions that are above the EU-prescribed limits. The carbon tax will eliminate any duty concessions that the exporters of steel and aluminium might get post the FTA. India’s exports and steel and aluminium are substantial.