The negotiations between India and the US on a trade deal are going in “full speed”, said Union Finance Minister Nirmala Sitharaman and expressed hope that an agreement will be structured soon. The ongoing trade deal negotiations briefly came up for discussion during a pull aside between Sitharaman and US Treasury Secretary Steven Mnuchin at the IMF headquarters. Mnuchin is scheduled to visit India early next month. “In fact, I broadly mentioned it to Secretary Mnuchin, but that is something on which the Commerce minister and Mr (Robert) Lighthizer (US Trade Representatives) are working. My inputs are that the negotiations are going in full speed and there’s a great intensity with which both sides are engaging and hopefully the deal will be structured soon,” she said.
India is demanding exemption from high duties imposed by the US on certain steel and aluminium products, resumption of export benefits to certain domestic products under their Generalised System of Preferences (GSP), greater market access for its products from sectors, including agriculture, automobile, auto components and engineering. On the other hand, the US wants greater market access for its farm and manufacturing products, dairy items and medical devices, and cut on import duties on some ICT products. The US has also raised concerns over high trade deficit with India. In 2018-19, India’s exports to the US stood at $52.4 billion, while imports were $35.5 billion. Trade deficit dipped from $21.3 billion in 2017-18 to $16.9 billion in 2018-19.
While answering to a question, Nirmala said a totalisation agreement with the US has always been on the cards. Totalisation agreement seeks to eliminate dual taxation with regards to social security and medicare taxes in the United States. “One of the reasons why that was never responded to was that India did not have a social welfare net or social insurance cover for Indians in India. And therefore, if they had to give it, they wouldn’t be given in the sense where would it be used?” she said. “Today, I think most private insurances or for many of the families which are below the certain level of income, Ayushman Bharat is a fantastic big coverage. There is also now a lot more private sector option for insurance coverage. So whether that has been factored in now in the negotiations on this particular thing, I’m not adequately informed,” she added. An official release issued said Nirmala Sitharaman had a “fruitful” dialogue with Mnuchin. The two sides agreed to continue the dialogue in the first week of November during Mnuchin’s visit to New Delhi, it said. This is a certainly a positive sign for cordial relationships between the two nations.