New Delhi, Mar 11 (PTI) India and the US are planning to negotiate a trade agreement, and both countries will focus on increasing market access, reducing import duty and non-tariff barriers, and enhancing supply chain integration, Parliament was informed on Tuesday.

In a written reply to the Lok Sabha, Minister of State for Commerce and Industry Jitin Prasada said that as of date, reciprocal tariffs have not been imposed by the US on India.

"Both countries plan to negotiate a mutually beneficial, multi-sector Bilateral Trade Agreement. Both countries would focus on increasing market access, reducing tariff and non-tariff barriers, and enhancing supply chain integration," he said.

The US issued a memorandum on reciprocal trade and tariffs on February 13, wherein the US Commerce Secretary and United States Trade Representative (USTR) are to take necessary actions to investigate harm to America from any non-reciprocal trade arrangements adopted by trading partners and provide a report with detailed proposed remedies for each trading partner.

Tariffs are import duties imposed and collected by the government and paid by companies to bring foreign goods into the country.

During the visit of Prime Minister Narendra Modi to Washington last month, India and the US announced their commitment to more than double the two-way commerce to USD 500 billion by 2030 and negotiate the first tranche of a mutually beneficial, multi-sector Bilateral Trade Agreement (BTA) by fall of 2025.

In 2023, the US-India bilateral trade in goods and services stood at USD 190.08 billion (USD 123.89 billion in goods and USD 66.19 billion in services trade). That year, India's merchandise exports to the US stood at USD 83.77 billion, while imports were USD 40.12 billion, leaving a trade gap of USD 43.65 billion in favour of India.

During 2021-24, America was India's largest trading partner. The US is one of the few countries with which India has a trade surplus.

Prasada also said that India continues to engage with the US to achieve enhancement and broadening of bilateral trade ties in a mutually beneficial and fair manner.

"This is an ongoing exercise and Indian exporters are working towards diversifying trade baskets and export destinations," he said.

Commerce Secretary Sunil Barthwal on Monday told a Parliamentary panel that negotiations between the two countries are still on and no agreement on trade tariffs has been reached so far.

Barthwal briefed the Parliamentary Committee on External Affairs, on US President Donald Trump's recent claims that India has agreed to reduce its tariffs "way down", while Foreign Secretary Vikram Misri briefed the committee on China and Europe.

Commerce and Industry Minister Piyush Goyal on March 8 returned from Washington after holding trade talks with his US counterparts.

During his week-long visit, Goyal held talks with US Trade Representative (USTR) Jamieson Greer and US Commerce Secretary Howard Lutnick. The minister is expected to visit America again for the talks.

US President Donald Trump has criticised the high tariffs charged by India and other countries, terming them as "very unfair" and announced reciprocal tariffs from April 2 on nations that impose levies on American goods.

In 2023-24, India exported engineering goods worth USD 17.62 billion to the US. The other major goods included electronics (USD 10 billion), gems and jewellery (USD 9.9 billion), petroleum products (USD 5.83 billion), textiles (USD 4.7 billion), and marine products (USD 2.5 billion).

In a separate reply, the minister said India's tariff policy aims to regulate trade, protect domestic industries, and generate revenue through taxes on imported and exported goods.

"Recent reforms have focused on streamlining the tariff structure and facilitating trade," Prasada said.

India is a member of the WTO (World Trade Organization) and bound to its maximum tariff that can be applied to a product category. The applied tariffs are generally below the bound tariff for a given commodity line.

"With the changing trade scenario, India is moving towards having Preferential/Free Trade Agreements wherein customs tariffs and non-tariff barriers are reduced or eliminated on substantial trade between the PTA/FTA members," he added.

At present, India is a member of 13 FTAs and 9 PTAs apart from the negotiations with the EU, the UK, and Oman. PTI RR BAL BAL

View Source

Login to TaxTMI

Username/Email Address

Password

Remember Me (auto-login)

By checking this you will be auto logged in, if required, for next 3 days (unless manually logged out)

Log In

Forgot Password ?

India, US to increase market access, cut tariff, non-tariff barriers: Govt

The Email Id has not been verified. Click on the link we have sent on

Go Back Done

Didn't receive the mail? Resend Mail

Don't have an account? Register Here