External Affairs Minister S Jaishankar met US Secretary of State Michael Pompeo in Washington on Monday. The meeting comes amid advanced stages of discussions between US and India on a trade deal soon. The Ministry of External Affairs is on a three-day visit to US. EAM Jaishankar will also be meeting US Defence Secretary Mark Esper and the new National Security Advisor Robert O'Brien.
A good conversation with @SecPompeo focusing on the further progress of our bilateral relations. Also discussed important regional and global issues. Welcomed the continuing development of a key partnership. pic.twitter.com/cckktoXt1X— Dr. S. Jaishankar (@DrSJaishankar) October 1, 2019
In June, following the revocation of preferential trade privileges by US President Donald Trump, there began tensions on the trade front between the two countries. India, in response to this imposed tariffs on 28 US products, including almonds and apples. India had been the biggest beneficiary of the Generalised System of Preferences (GSP), a programme designed to help developing countries sell to US consumers. At a joint press conference with Prime Minister Narendra Modi on the sidelines on UNGA summit, US President Donald Trump had said that New Delhi and Washington would reach trade deal "soon".
EAM S Jaishankar said most of the trade disputes between India and the US are 'resolvable in the near term', as he ruled out pushing the issue for the next American administration. In an event organised by the Carnegie Endowment for International Relationship think-tank, Jaishankar said the foreign policy and priorities of the Modi government is in tune with the realities of a New India, which is currently the fifth-largest global economy and is soon going to be the third-largest. "Most of the trade disputes (with the US) are resolvable in the near term," Jaishankar told the audience in his first engagement of his maiden trip to the US capital as External Affairs Minister. He said the Modi government wants to resolve the Indo-US bilateral trade issue as early as possible and does not want to push it for the next administration in the US.
The US Presidential election is scheduled to take place in November 2020. India and the US are negotiating a trade package to iron out bilateral trade issues and promote two-way commerce. India is demanding exemption from high duties imposed by the US on certain steel and aluminum 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 USD 52.4 billion, while imports were USD 35.5 billion. Trade deficit dipped from USD 21.3 billion in 2017-18 to USD 16.9 billion in 2018-19. India received FDI worth USD 3.13 billion from the US in 2018-19, higher than USD 2 billion in 2017-18. Jaishankar said some of the backbones of the bilateral ties are the knowledge economy, which is growing deeper, and the diaspora connect, which has become stronger both in terms of number and quality.