India, U.S. to expand farm trade, aim to resolve market access issues

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NEW DELHI – Reuters -India and the United States agreed on Tuesday to expand trade of some agricultural products, including U.S. cherries, alfalfa and distiller dried grains as well as Indian mangoes, grapes, shrimp and water buffalo meat.

In a joint statement issued after the first U.S.-India Trade Policy Forum meeting in four years in New Delhi, the two countries’ trade ministers also discussed the possibility of restoring India’s trade benefits under the U.S. Generalized System of Preferences.

The statement came as U.S. Trade Representative Katherine Tai ended a two-day visit to try to rebuild trade ties between the world’s richest and largest democracies.

“The Ministers expressed an intent to continue to work together on resolving outstanding trade issues as some of these require additional engagement in order to reach convergence in the near future,” the statement from Tai and Indian Minister of Commerce and Industry Piyush Goyal said.

New Delhi and Washington have sparred over a range of issues including tariffs for over a year, hampering the prospects of concluding a bilateral trade package.

Tuesday’s meeting followed Indian Prime Minister Narendra Modi’s meeting with U.S. President Joe Biden in Washington in September when both leaders agreed to expand trade ties to strengthen relations.

“The forum heralds a new beginning in India-U.S. trade partnership,” Goyal said in a tweet after the meeting.

The two ministers agreed to use the “revitalized” forum to rapidly engage on new trade concerns as they arise and plan to evaluate progress on a quarterly basis.

The two sides also discussed U.S. interest in supplying ethanol to India and speeding up phyto-sanitary work to allow more agricultural imports for both countries, including U.S. pork and Indian table grapes.

India also raised its interest in restoration of its beneficiary status under GSP, the U.S. program that provides some tariff-free access for imports from developing countries that expired at the end of 2020. The Trump administration in 2019 had terminated India’s access for about $5.6 billion of annual exports amid disputes over digital trade and other issues.

The United States noted in the statement that “this could be considered, as warranted, in relation to the eligibility criteria determined by the U.S. Congress.”

For India and other developing countries to receive GSP trade benefits, Congress would have to reauthorize the program, which may come with new restrictions and conditions on labor and environmental issues.

Tai, accompanied in New Delhi by Deputy U.S. Trade Representative Sarah Bianchi, earlier raised issues of market access restrictions, high tariffs, unpredictable regulations and restricted digital trade between the two countries.

India has been resisting a U.S. demand to lower tariffs, arguing that applied tariffs were way below the permissible limit under the WTO rules, while seeking more exports of goods and services.

Bilateral goods’ trade between the two countries in the first nine months this year rose nearly 50% from a year earlier as their economies reopened after restrictions due to the pandemic, and is set to surpass $100 billion this year, the joint statement said.