India-US Trade Talk: ‘India needs to be cautious on trade deal with US’, warns GTRI

New Delhi| India will have to be careful while negotiating a bilateral trade agreement with the US, as no fast track trade authority (Fast Track Trade Authority) in the US may require congressional approval for any major changes to the agreement. Economic think tank Global Trade Research Initiative (GTRI) has said this amid reports of talks on trade between the two countries starting.

GTRI founder Ajay Srivastava said that due to America’s post-FTA certification process, America gets a chance to bargain again even after any agreement is signed. During the talks, US officials may make such demands from India related to changes in domestic law, regulatory reforms and policy changes, which may affect the sovereignty of the country.

He said, “India not only needs to show diplomatic skills in talks with America”. Apart from this, we also have to be cautious of the legal inequalities present in America’s trade policies

Why are talks with America a matter of concern for India?
An authority in the US called the Fast Track Trade Authority has expired since 2021. Due to this, any trade agreement made on behalf of the US President may face amendment, postponement or rejection in Congress. On the other hand, in any trade agreement the US unilaterally decides whether the partner country has fulfilled all its conditions under the agreement. The Americans have used the procedure in the past to impose additional conditions on a number of countries.

Srivastava said, “Both these reasons create serious uncertainty related to the trade agreement”. The U.S. may make later changes to the agreement or make additional demands. In such a situation, India needs to be extremely cautious in FTA talks Meanwhile, in the wake of US President Donald Trump’s plan to impose reciprocal tariffs from April 2, officials in India and the US are starting formal talks on a trade deal from Wednesday.