The US wants greater access to Indian markets and a limited trade deal, hammered out in the Biden era, will enhance relations between the two nations as strategic partners in a multipolar world.
An independent US Congressional Research Service (CRS) report comes as a confident sign that the two nations are making an effort to arrive at a limited trade deal and strengthen bilateral ties.
A statement in a report compiled by the Congressional Research Service (CRS) states that “The United States and India are negotiating on a wide range of trade concerns, including greater access to the Indian market for US agricultural products, potentially in exchange for US restoration of India’s eligibility under GSP. The current status of the negotiations has not been disclosed.”
Outgoing US President Donald Trump had earlier terminated India’s status as a beneficiary developing nation which qualifies for the Generalised System of Preferances (GSP) programme after he was convinced into believing that New Delhi would not give the US reasonable and justifiable access to its markets. But the new forecasts are reassuring that trade ties between the two nations will soon be on a smooth track.
Agriculture is in the spotlight
Agriculture is the area of prime focus for the US and it is not surprising, given that the Indian government under the leadership and vision of Prime Minister Narendra Modi had enacted far reaching reforms in this sector given that it has been a key prop to the Indian economy as it resets itself for an upward spike despite the ravages wrought across the country by the pandemic. India wants to take agriculture to a global platform and invite investors to reap the benefits of this.
The CRS reports are not an official blueprint consulted by the US Congress but its pointers enable American lawmakers to make informed choices and decisions. The US is viewing India as a strategic partner in a multipolar world where Washington and New Delhi have their share of pain points with China. A rapidly growing population coupled with increasing incomes and a demand for high-value food products is growing in India which is a potential market which can no longer be ignored.
India is one of the leading nations in the world producing a range of crop and livestock commodities. The United States Department of Agriculture (USDA), believes that India will import a fair volume of dairy products, vegetable oils, pulses, tree nuts, and fruit.
A lot more needs to be done though to prop up the farming trade numbers. Agricultural exports from the US to India have increased marginally since 2015, reaching USD 1.6 billion in 2019. The US in the same year imported agricultural products valued at USD 2.6 billion from India. The numbers flatter to deceive but its potential cannot be denied. This explains why Washington wants more access for its farm and dairy items into India.
There is a fair degree of optimism that the Biden era will not affect ties with India despite the fact that the Indian government had invested time and energy with Donald Trump. Support for India is bipartisan and closer strategic, economic ties will only help to bolster the relationship. The limited trade deal is expected to pass through under Biden along with a few tweaks that will help to alter the optics to a degree. India’s trade surplus with the US has come down from a high of $24 billion in 2015 to $16.85 billion in 2019. The future, however, has a lot to be hopeful for at least for the next four years.