Tensions between India and United States of America has increased over each side’s tariff policies while the two sides have also held concerted negotiations to address these trade frictions under the administration of President Donald Trump, according to a US Congressional report.
A report by the Congressional Research Service (CRS), a bipartisan research wing of US Congress, pointed out that India’s recent tariff hikes on cell phones and other telecommunication goods went up from zero per cent to 15-20 per cent in the last few years.
“Under the Trump administration, bilateral tensions increased over each side’s tariff policies. In general, India has relatively high average tariff rates, especially in agriculture. It can raise its applied rates to bound rates without violating its commitments under the WTO (World Trade Organization), causing uncertainty for US exporters,” said the CRS report.
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India had imposed higher tariffs of around 10 to 25 per cent on US exports, affecting about $1.32 billion worth of commodity transfer, after it lost its eligibility for the US Trade Preference Program.
India’s technology tariffs have garnered a widespread dislike in the world as the US and several other countries have requested to join various WTO dispute consultations against New Delhi while also questioning its compliance with WTO Information Technology Agreement.
The U.S. goods and services trade deficit with India was $28.8 billion in 2019. India is currently the 9th largest goods trading partner of US with $92.0 billion in total (two way) goods trade during 2019.
