India-US negotiations on a bilateral trade agreement has gone into extra time, with the deadline now shifting to Aug 1. Is that good or bad for India?
Abhijit Das, former head of the Centre for WTO Studies in Delhi, believes that “the more the negotiations drag on, more will be the demands that the US will likely make on India particularly in the agriculture sector. It will require India to make concessions if the interim agreement has to be finalised.”
Das believes the pressure on India will be more in the area of poultry, soyabean, corn, maybe even rice and wheat.
“The biggest lobby group in the US is on rice. They want to make sure India’s MSP (minimum support price) is dismantled so they can export to the Indian market,” Das pointed out. “Ethanol is another issue, then problems around US ambitions to export GM products to India.”
He warns that while tech has not been talked about much, “I would be very surprised if the US does not bring the interests of its Big Tech to the negotiating table. They might be demanding a permanent moratorium on customs duties on electronic transmissions. They might want a commitment that in future, government will not mandate localisation of servers.”
Not only will US Big Tech want free flow of data across borders, they will also seek any data that government shares with a local domestic entity.
“The idea is to tie the hands of the government from implementing policies which can help India create vibrant domestic champions in the digital sector in the future.”
A major aim of the US is to get governments to de-link from the Chinese economy, particularly through global value chains. China, in a countermove, is trying to get closer to the Asean states. This is where the US strategy of targeting Asean with tariffs could boomerang.
Tune in for more in this conversation with Abhijit Das, former head of the Centre for WTO Studies.
