Recently, after a gap of four years, the Trade Policy Forum (TPF) was convened between the United States and India. The Forum resolved to take economic ties between the two countries to the ‘next high level’ and exchanged views on ‘potential targeted tariff reductions’.
- To activate working groups of the TPF on agriculture, non-agriculture goods, services, investment, and intellectual property to meet frequently and address issues of mutual concern in a mutually beneficial manner.
- The idea is to deliver tangible benefits to both countries by resolving outstanding market access issues.
- The Forum has decided to forge an agreement to facilitate U.S. market access from India, and reciprocate with similar access in the Indian market to many agriculture and animal products.
- Restoration of the GSP: India has sought restoration of the GSP (Generalized System of Preferences) benefits by the U.S.
- Totalisation Agreement: The Forum also agreed on the significance of negotiating a Social Security Totalization Agreement in the interest of workers from both sides.
- A Totalization Agreement is a convention between two countries preventing duplicate social security contributions for the same income.
- It would allow workers from both countries to move their retirement savings, the lack of which particularly affects Indian IT workers in the U.S.
- Towards Rules-based Global Trading System: India and the U.S. also discussed engagement in various multilateral trade bodies including the World Trade Organisation (WTO) and the G20 for achieving a shared vision of a transparent, rules-based global trading system among market economies and democracies
- The Forum also decided to find mutually agreed solutions on outstanding WTO disputes between the two countries
The first step towards a potential deal is for India to take the initiative and consider unilaterally removing its retaliatory tariffs. This will represent India as willing to be a constructive player in trade talks.
SOURCE: THE HINDU,THE ECONOMIC TIMES,MINT