India Should Focus On Industrial Tariffs, Avoid Broader Trade Issues: GTRI

New Delhi, Mar 26 (KNN) Global Trade Research Institute (GTRI) has urged India to maintain a focused approach during negotiations with the Assistant US Trade Representative Brendan Lynch this week.

The think tank suggests that India should concentrate exclusively on industrial goods tariffs while exercising caution about broader trade agreement parameters.

Lynch and a delegation of US government officials arrived in India on March 25 for a five-day visit aimed at advancing discussions on a proposed bilateral trade agreement (BTA).

Both nations anticipate finalising the initial tranche of the agreement by fall 2025, with significant economic implications for their trading relationship.

GTRI specifically recommends that India consider eliminating tariffs on 90 percent of industrial tariff lines, contingent upon reciprocal action from the United States.

Such an approach would potentially cover over 90 percent of bilateral merchandise trade. However, the institute advises against engaging in discussions surrounding intellectual property, digital trade, agricultural tariffs, subsidies, or government procurement.

The think tank has raised concerns about potential negotiations involving major US corporations like Tesla, Starlink, Amazon, and pharmaceutical firms.

These discussions could potentially impact national security, intellectual property rights, and the long-term sustainability of Indian businesses.

Recent diplomatic efforts by India, including unilateral tariff reductions on items such as bourbon whiskey and motorcycles ahead of high-level meetings, appear to have gone unacknowledged by the US side.

This strategic gesture, made during Prime Minister Narendra Modi's interactions with US officials, highlights the complex diplomatic dance underlying trade negotiations.

A critical point of concern highlighted by GTRI is the absence of 'Fast Track Trade Authority' (FTTA) in the United States.

Without this special congressional power that typically expedites trade negotiations, any bilateral agreement remains vulnerable to potential legislative interventions and post-agreement modifications.

The report emphasises the inherent risks in the current negotiation landscape. The US's established practice of a unilateral certification process can potentially pressure partner countries after a trade deal is signed, creating significant uncertainty about the final agreement's stability and terms.

As the negotiations progress, diplomatic finesse and strategic vigilance will be paramount. The path forward requires careful navigation of legal asymmetries and potential legislative complexities embedded in the US trade approach.

(KNN Bureau)