Trade deal is unlikely as US administration officials cite concerns about an increase in economic barriers by the Indian government
By Geeta Goindi
Washington, DC, February 23, 2020 – Briefing reporters ahead of President Donald Trump’s first official visit to India early next week, a senior administration official has underscored the trip demonstrates “the strong and enduring ties” between the world’s two largest democracies.
The president, accompanied by First Lady Melania Trump, will arrive in Ahmedabad, Gujarat, around noon on Monday, and head to the reconstructed Motera Stadium (also known as the Sardar Patel Stadium), the world’s biggest cricket complex with a capacity for 110,000 spectators, where he will deliver remarks together with prime minister Narendra Modi. The event billed ‘Namaste Trump’ is expected to recreate the magic of the mega ‘Howdy Modi’ rally held last September in Houston, Texas, which drew over 50,000 enthusiastic Indian-Americans who cheered Modi and Trump as they shared the stage.
In the mid afternoon, the First Couple together with Modi will embark for Agra to visit the historic Taj Mahal, from where they will head to Delhi. The following day will be packed with official engagements: bilateral meetings with Modi, ceremonial events, a business meeting with Indian investors, capped off by a state dinner hosted by Indian president Ram Nath Kovind at Rashtrapati Bhavan.
The White House revealed Friday that Trump will be accompanied on the two-day trip, February 24-25, by a 12-member official delegation including his daughter and special advisor Ivanka Trump and son-in-law and senior advisor Jared Kushner, Secretary of Commerce Wilbur Ross, Energy Secretary Dan Brouillette, National Security Advisor Robert O’Brien, American ambassador to India Ken Juster, White House press secretary Stephanie Grisham and other key administration officials. Two high-ranking Indian-Americans, Ajit Pai, designated by Trump to chair the Federal Communications Commission (FCC), and Kash Patel, senior director for counterterrorism, will be on hand for the bilateral meetings.
In a conference call with reporters, the White House official said, “The president is going to India as a demonstration of the strong and enduring ties between our two countries. These are ties based on shared democratic traditions, common strategic interests, and enduring bonds between our people. And, in part, this has been exemplified by the very close relationship between the president and prime Minister Modi”.
On the economic front, White House officials were non-committal when it came to a trade deal citing concerns with India’s trade barriers.
“We have had a number of announcements coming from the Indian government in the past several weeks which are making the discussions a bit more difficult perhaps”, the senior official told reporters referring to the ‘Make in India’ initiative which “have made the protectionism concerns in India even greater. So, we will be discussing those concerns and what we see as an increase in barriers, not a decrease”, the official said.
At the same time, the key administration official did not rule out the possibility of a trade deal, rather placed the onus squarely on India.
“Whether or not there will be an announcement on a trade package is really wholly dependent upon what the Indian government is prepared to do”, the official said adding that a number of significant commercial deals will be announced over the course of the trip in key sectors such as energy and defense.
Speaking to reporters earlier this week on the likelihood of a trade deal with India, President Trump indicated that some kind of interim agreement is possible, but he is “really saving the big deal for later on. We’re doing a very big trade deal with India”, he said. “We’ll have it. I don’t know if it will be done before the (November) election, but we’ll have a very big deal with India”, he emphasized.
“We’re not treated very well by India, but I happen to like Prime Minister Modi a lot”, Trump said and proceeded to gush about some “seven million people” who will be greeting him when he lands in the Indian leader’s home state. “So, it’s going to be very exciting”, Trump told reporters about his upcoming trip adding, “I hope you all enjoy it”.
Along with diminishing prospects for a concrete trade deal during or soon after the presidential visit, it does not seem likely that India’s participation in the Generalized System of Preferences (GSP) will be restored anytime soon.
Last year, the US terminated India’s preferential trade status under the GSP program which is the largest and oldest US trade preference scheme. India was the biggest beneficiary in 2017: $5.7 billion in imports to the US was given duty-free status.
“The concerns that led to the revocation, suspension of India’s GSP access, remains a concern for us”, the senior Trump administration official told reporters mentioning “the failure of the Indian government to provide equitable and reasonable access to its markets in numerous sectors”.
“The trade and economic relationship with India is critically important to the United States, and I think also access to the US market is critical to the Indian government. We do want to make sure that we get this balance right. We want to address a lot of concerns and we are not quite there yet”, the official said pointing to the possibility of prolonged discussions which could continue beyond the president’s visit.
A journalist wanted to know if Trump is planning to say anything to Modi about his government’s attempt to keep Muslim migrants from being able to gain Indian citizenship through the amended citizenship act, or the National Registry of Citizens which could exclude some Muslims from retaining their citizenship. Thus far, the US administration has maintained a rather stoic silence on both issues.
“President Trump will talk about our shared tradition of democracy and religious freedom both in his public remarks and then certainly in private”, the official acknowledged noting that both nations “place a premium on citizen-centric governments”.
Trump “will raise these issues particularly the religious freedom issue”, the official said emphasizing, “We have great respect for India’s democratic traditions and institutions and we will continue to encourage India to uphold those traditions”.
The official noted that “India has a strong foundation of democracy. It is a country rich in religious, linguistic and cultural diversity” and “the birthplace of four major world religions”.
Responding to a query on whether President Trump would again offer to mediate on Kashmir, the administration official stated the US position which is to encourage a reduction in tensions between India and Pakistan, and encourage the two countries to engage in a bilateral dialogue with each other to resolve their differences.
“We continue to believe a core foundation of any successful dialogue between the two is based on continued momentum in Pakistan’s efforts to crack down on terrorists and extremists on its territory”, the official averred.
The upcoming presidential visit will focus on defense and security cooperation to both fight terrorism and promote a free and open Indo-Pacific, the official told reporters. Noting that “India is a pillar of our Indo-Pacific strategy”, the Trump administration official made it clear that “the US wants an India that is strong with a capable military that supports peace, stability and a rules-based order in the Indo-Pacific region”.
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