India and US trade talks intensify as tariffs reshuffle global market dynamics
The Aayog in its third edition of 'Trade Watch Quarterly', said there will be significant opportunities for India in the US markets both in terms of the number of products and volume of the US market. 'India is expected to gain competitiveness in 22 out of the top 30 categories (HS 2 level), representing a market size of $2,285.2 billion,' the Aayog said. It further explained that China, Canada, and Mexico are the leading exporters to the US in these categories, therefore higher tariffs on these countries at 30 per cent, 35 per cent, and 25 per cent, respectively, will enhance India's competitiveness.
The Aayog said India's competitiveness will remain unchanged in 6 out of 30 categories, amounting for 32.8 per cent exports to the US and 26 per cent of the US total imports, amounting to $26.5 billion. While for six product categories at HS 2 level, India faces a higher average tariff(between 1-3 per cent) which can be negotiated with the US, the Aayog said, 'In 78 products, accounting for 52 per cent of India's exports and 26 per cent share in total US imports, India is expected to gain competitiveness.' For 17 products (accounting for 28 per cent of India's export to the US) out of the top 100 products at the HS-4 level, the Aayog said India's competitiveness remains unchanged due to no change in tariff differential.
The Aayog also pointed out that 'India stands to gain in sectors with high tariff gaps vs China, Canada and Mexico -- minerals and fuels, apparel, electronics, plastics, furniture, and seafoods in a $1,265-billion market'. Meanwhile, An Indian commerce ministry team has reached Washington for another round of talks on the proposed bilateral trade agreement (BTA), which will begin on Monday. Chief negotiator of India and special secretary in the department of commerce Rajesh Agrawal will join the team on Wednesday.
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