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Time of India
11 hours ago
- Business
- Time of India
‘Aggressive US pressure can force…': GTRI warns India against one-sided trade deal; says don't fall into same trap' as Indonesia
GTRI emphasised that the US-Indonesia agreement should serve as a cautionary example for India. (AI image) India-US trade deal: America's trade agreement with Indonesia is 'one-sided' and India should look to avoid falling into the same trap, the Global Trade Research Initiative (GTRI) has warned. Even as the two countries continue discussions amid US President Donald Trump's August 1 tariff deadline, GTRI has cautioned against hasty deals that may harm India in the long run. The GTRI has warned that the US-Indonesia trade agreement is a 'clear example of how aggressive US pressure can force' nations into unbalanced trade commitments. According to a report released on Wednesday, GTRI stated that "The deal strongly favors the US, opens up Indonesia's markets, weakens its domestic regulations, and damages its long-standing position at the WTO." According to ANI, GTRI emphasised that this agreement should serve as a cautionary example for India in its trade discussions with the United States. US-Indonesia Trade Agreement 'One-Sided' The agreement stipulates that Indonesia will remove 99% of its tariffs on American exports, providing nearly complete access to its market for US industrial, technological and agricultural products. The United States, in exchange, will implement a 19% tariff on Indonesian goods, reduced from an initially proposed 40%. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Why seniors are rushing to get this Internet box – here's why! Techno Mag Learn More Undo Indonesian exports will continue to be subject to US MFN (Most Favoured Nation) tariffs. Also Read | Russia oil trouble hits: Shipowners and oil traders avoiding Russia-backed Nayara Energy in India; impact after EU sanctions Based on the trade agreement, Indonesia has committed to purchasing American goods valued at $22.7 billion. The breakdown includes $15 billion for energy products such as LPG, crude oil and petrol, $4.5 billion for agricultural commodities including soybeans, soybean meal, wheat and cotton, whilst $3.2 billion is allocated for Boeing aircraft, as detailed in the GTRI report. "The US-Indonesia trade deal forces Jakarta to give up key domestic regulations that have long protected its industries, food safety, and digital space," GTRI said. "Indonesia has agreed to eliminate local content requirements, which means U.S. companies can now operate in Indonesia without sourcing from local suppliers. This will hurt Indonesian MSMEs that rely on demand from larger firms. Making matters worse, there's no rule requiring US firms to disclose whether their inputs are sourced from China or other countries." Also Read | China's rare earth export curbs hit another industry! Apple AirPods production at Foxconn India unit faces hurdles; here's what's happening According to GTRI, Indonesia has agreed to adopt American vehicle safety and emissions standards. This enables US automobile manufacturers to directly export their vehicles to Indonesia without modifications, although Indonesian manufacturers must still meet US regulations for exporting to America. "By agreeing to remove restrictions on remanufactured goods, Indonesia opens the door to a flood of low-cost, second-hand machinery and components from the U.S. This could severely impact local capital goods and engineering firms that cannot compete with cheaper refurbished imports," the GTRI report read. India-US Trade Deal: The Indonesia Example GTRI noted that the United States has been attempting to secure comparable arrangements with India. A few days ago Trump had said that the deal with India could possibly be on the lines of the agreement with Indonesia in terms of market access. India currently faces comparable demands from the US, including permissions for remanufactured products, liberalisation of agriculture and dairy sectors, acceptance of genetically modified (GM) feed, and implementation of US-specified digital trade and product standards. Also Read | Trump tariff war: Deal or no deal - why it won't matter much for India "These are not small changes--they are major shifts that affect India's long-term ability to manage its economy, protect public health, and support local industries," GTRI opined. The organisation emphasised that India needs to maintain vigilance, whilst ensuring any trade agreements are founded on transparent, public evaluations of advantages and disadvantages. "Concessions--especially on critical areas like food, health, digital, and IP--must be fair, reciprocal, and aligned with India's development needs. Otherwise, India risks giving up long-term control for short-term gains, a decision it may regret later," it supplemented. The analysis suggests that Washington's pursuit of dominance over equitable practices might yield immediate advantages but could erode trust, disrupt international commerce, and hinder genuine economic collaborations. Also Read | Russia oil squeeze: Trump's 100% tariff threat - should India panic? Initially, US President Donald Trump implemented reciprocal tariffs on numerous nations where the US experienced trade deficits. Subsequently, President Trump announced a 90-day tariff suspension after several countries began trade deal discussions. During this period, from April 9 to July 9, he established a universal 10 per cent baseline tariff. The Trump administration extended the deadline for additional tariff implementation on various countries, including India, until August 1. Following his re-election, President Trump maintained his position on tariff reciprocity, stating that the United States would implement equivalent tariffs to those imposed by other nations, including India, to ensure trade fairness. A senior delegation from India's Commerce and Industry Ministry visited Washington DC to advance important discussions regarding a Bilateral Trade Agreement (BTA) with the United States. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
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Business Standard
a day ago
- Business
- Business Standard
India-US trade deal: Exporters in a fix over possible tariff cost split
Begin talks with buyers, particularly for goods arriving at US ports on or after Aug 1 premium Shreya Nandi New Delhi Listen to This Article Indian exporters have begun engaging with American buyers to discuss how a potential additional tariff burden would be split if New Delhi faces a 26 per cent reciprocal tariff in case an interim trade deal is not finalised by August 1. Currently, a 10 per cent ad valorem tariff, over and above the existing most-favoured-nation (MFN) duty, continues on American imports. However, from August 1, the US administration is set to impose steep, country-specific reciprocal tariffs on its trading partners. The discussions are particularly critical for goods that have already been shipped and will arrive at American ports on or
Indian Express
2 days ago
- Business
- Indian Express
Tariff uncertainty continues: US team to visit India in mid-Aug, well after Aug 1 ‘hard deadline'
After Indian negotiators wrapped up another round of negotiations in Washington last week, a US team led by US Trade Representative for South and Central Asia Brendan Lynch is expected to visit India in mid-August to continue negotiations for a trade agreement, The Indian Express has learned. While India and the US have agreed on a wide range of tariff lines, the negotiations — which currently only involve market access for goods — are stuck over sensitive sectors such as agriculture and automobiles, which are key job creators in India. The new round of talks beyond the August 1 deadline comes amid growing suspense over whether India will face 26 per cent reciprocal tariffs starting August 1, as US Commerce Secretary Howard Lutnick on Sunday said that August 1 is a 'hard deadline' for countries to begin paying tariffs. 'That's a hard deadline, so on August 1, the new tariff rates will come in… Nothing stops countries from talking to us after August 1, but they're going to start paying the tariffs on August 1,' Lutnick said in a television interview on Sunday. Notably, President Donald Trump's deadline for implementation of reciprocal tariffs has shifted from April 1 to July 9, and now to August 1. While Trump has reiterated that a deal with India is close, India could face tariffs of up to 26 per cent if both countries fail to reach an agreement. Government officials have maintained that India is aiming to sign a bilateral trade agreement (BTA) by the end of the year, which would provide market access in labour-intensive sectors and ensure a significant tariff differential compared to its Asian peers. Lutnick also said that smaller countries — including those in Latin America, the Caribbean, and many in Africa — would face a baseline tariff of 10 per cent. 'The bigger economies will either open themselves up or they'll pay a fair tariff to America,' he said. Trade experts have pointed out that, despite being presented as trade 'agreements', Trump's deals do not meet WTO standards for Free Trade Agreements (FTAs). Under WTO rules, FTAs require mutual tariff reductions on a substantial share of trade. 'Under the Trump model, only the partner country lowers its Most-Favoured-Nation (MFN) tariffs, while the US makes no reciprocal cuts. Trump lacks Fast Track Trade Authority from Congress to reduce MFN tariffs. Instead, he's offering to roll back only the 'Liberation Day' tariffs imposed in April under emergency powers — tariffs that a US federal court has already ruled unlawful. The case is under appeal, but the legal basis remains fragile,' the think tank Global Trade Research Initiative (GTRI) said. For India, those April tariffs added a 26 per cent surcharge on top of normal US tariffs. Even if a deal is struck, Indian exports may still face a minimum 10 per cent additional levy, making it a pressured compromise, not a true partnership, GTRI said in a report.
Indian Express
3 days ago
- Business
- Indian Express
US trade policy: Aug 1 ‘hard deadline' for reciprocal tariffs, says Commerce Secretary Howard Lutnick
As India awaits an announcement on an interim trade deal with the US, Commerce Secretary Howard Lutnick on Sunday said that August 1 is a hard deadline for countries to begin paying tariffs, although the US will continue to engage with them afterwards. This comes after India and the US concluded a week-long round of trade negotiations aimed at finalising an interim trade deal, seen as crucial for India to avoid reciprocal tariffs and gain an edge over its Asian peers. 'That's a hard deadline, so on August 1, the new tariff rates will come in… Nothing stops countries from talking to us after August 1, but they're going to start paying the tariffs on August 1,' Lutnick said in a television interview on Sunday. Notably, President Donald Trump's deadline for reciprocal tariffs has shifted from April 2 to July 9, and now to August 1. While Trump has reiterated that a deal with India is close, India could face tariffs of up to 26 per cent if both countries fail to reach an agreement. Government officials have maintained that India is aiming to sign a bilateral trade agreement (BTA) by the end of the year, which would provide market access in labour-intensive sectors and ensure a significant tariff differential compared to its Asian peers. Lutnick further stated that smaller countries — including those in Latin America, the Caribbean, and many in Africa — would face a baseline tariff of 10 per cent. 'The bigger economies will either open themselves up or they'll pay a fair tariff to America,' he said. Meanwhile, trade experts have pointed out that, despite being presented as trade 'agreements,' Trump's deals do not meet WTO standards for Free Trade Agreements (FTAs). Under WTO rules, FTAs require mutual tariff reductions on a substantial share of trade. 'Under the Trump model, only the partner country lowers its Most-Favoured-Nation (MFN) tariffs, while the US makes no reciprocal cuts. Trump lacks Fast Track Trade Authority from Congress to reduce MFN tariffs. Instead, he's offering to roll back only the 'Liberation Day' tariffs imposed in April under emergency powers — tariffs that a US federal court has already ruled unlawful. The case is under appeal, but the legal basis remains fragile,' the think tank Global Trade Research Initiative (GTRI) said. For India, those April tariffs added a 26 per cent surcharge on top of normal US tariffs. Even if a deal is struck, Indian exports may still face a minimum 10 per cent additional levy, making it a pressured compromise, not a true partnership, GTRI said in a report.
Business Times
16-07-2025
- Business
- Business Times
WTO overhaul targets fairer trade, easier decision-making to end paralysis
[GENEVA] World Trade Organization members are seeking to break years of paralysis in international trade negotiations, which have been sidelined by the Trump administration and risk becoming irrelevant, internal WTO documents seen by Reuters. Trump's sweeping tariffs have forced countries to line up to negotiate bilateral trade deals with Washington, bypassing the multilateral framework. WTO members had already struggled to reach deals due to a consensus requirement among all 166 members. Preventing members from blocking decisions is now the top priority in reform talks, diplomats told Reuters. 'The sense of urgency is palpable, and there is widespread recognition that there is no viable alternative to reform,' Norway's WTO Ambassador Peter Olberg, who was appointed to facilitate the organisation's reform talks, said in an internal communication to members seen by Reuters. The WTO's foundational Most Favoured Nation (MFN) rule requires equal treatment among members but developing countries have privileges to help them compete. These include China and India, which Trump argues are now major economies with no need for extra support. One document showed WTO members are aiming to streamline decision-making processes, promote fairer industrial policies including subsidies, and review the privileges of developing countries. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The proposals feed into reform consultations running through the latter part of this year that are intended to inform the next WTO ministerial conference in Cameroon in March. The latest round of consultations is taking place this week. Among the proposals is the so-called Pareto improvement, which a senior Chinese WTO delegate in Geneva said China had put forward. This measure would require members to provide clear, evidence-based proof of harm when blocking proposals. Other proposals include permitting members to opt out of decisions and allowing subsets of countries to advance negotiations without full consensus. 'The post-war multilateral system as we know it is dead,' Roberto Azevedo, WTO Director-General from 2013 to 2020, told Reuters, calling reform discussions a 'do or die' situation for the WTO in particular. WTO Director-General Ngozi Okonjo-Iweala conveyed the US position to members in a restricted document viewed by Reuters, that a 'reform by doing' approach – of practical, incremental improvements in the organisation's functioning – is 'vacuous' and would fail to tackle the deeper structural issues. The US said in its 2025 trade policy agenda that its patience is 'wearing thin' and that key issues will not be resolved until China and other major economies – implying countries like India – relinquish their privileges. China said in June that it had heard 'every word' of the US concerns, expressing openness to discuss such privileges, as well as tariffs and industrial policy. India's WTO mission did not respond to a request for comment. Current reform talks do not address the dispute settlement system, which will be considered at a later date, according to one of the WTO documents. The WTO declined to comment on this article. Olberg did not immediately reply to a request for comment. REUTERS
