With US President Donald Trump announcing a trade deal with Japan, and America having already signed deals with both Indonesia and the Philippines recently, India has been advised caution while negotiating the terms of a deal with the US in light of Washington’s pressure tactics to be given access to India’s agriculture and dairy sectors.
Economic think tank, Global Trade Research Initiative (GTRI), has advised India against bowing to the US’s pressure, as reflected in the US-Indonesia trade pact in which Indonesia has given up far more than it has gained.
Removing 99 per cent of its tariffs on US goods, agreeing to buy USD 22.7 billion in American products, and weakening important rules that protected its industries, food safety, and digital space shows that Indonesia was under pressure by Washington to cut tariffs, commit to large purchases, and loosen regulatory control, a GTRI report said.
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India should tread cautiously in ongoing trade talks to avoid similar concessions, it further added in its Wednesday report.
“India now faces similar US demands, including allowing remanufactured goods, opening up agriculture and dairy, accepting genetically modified (GM) feed, and adopting US rules on digital trade and product standards,” said Ajay Srivastava, founder of GTRI.
He also added that accepting American standards on cars, medical devices, or food, without any guarantee of reciprocity, would put India’s consumers at risk.
“Handing over control of data under the name of digital trade would give foreign companies power over India's digital future. India must stay alert. Any trade agreement should be based on clear, public assessments of costs and benefits,” Srivastava said.
Concessions, especially on critical areas like food, health, digital, and IP (intellectual property) must be fair, reciprocal, and aligned with India's development needs, he added.
“Otherwise, India risks giving up long-term control for short-term gains, a decision it may regret later,” he said.
So far, India and the USA have had five rounds of talks, with the sixth round expected to happen in India next month as both sides look to finalising an interim deal before August 1, when Trump’s deadline for suspended tariffs ends.
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