The governments of the United States and India announced an agreement last week in which India will remove retaliatory tariffs on aluminium and steel as well as the dismissal of half a dozen trade disputes between the two at the World Trade Organization (WTO).
United States Trade Representative Katherine Tai made the announcement on Thursday in conjunction with India’s Prime Minister Narendra Modi’s visit with United States President Joe Biden in Washington, D.C.
“We have decided to resolve long-pending trade-related issues and make a new beginning,” commented Indian Prime Minister Narendra Modi at a joint press conference last week.
The accord is something of a shock to many, as earlier in the week the Biden Administration cautioned that no agreements were likely between the United States and India in the near future.
In a press release, Ambassador Katherine Tai said the agreement is the product of a great deal of work from both sides.
“Prime Minister Modi’s visit has underscored the importance of the U.S.-India bilateral relationship and our cooperation on a range of shared priorities. Today’s agreement represents the culmination of intensified bilateral engagement over the last two years, including through the U.S.-India Trade Policy Forum, to deepen our economic and trade ties. As a result of our work, U.S. agricultural producers and manufacturers will now enjoy renewed access to a critical global market and we will strengthen our trade relationship with one of our closest partners. I look forward to continue to working with my counterpart, Minister Goyal, as we identify additional ways to bring our people and our economies together.”
In addition to aluminium and steel, India agreed to remove retaliatory tariffs on chickpeas, lentils, almonds, walnuts, apples, boric acid, and diagnostic reagents. New Delhi imposed duties on those items in response to the Trump Administration’s assessing Section 232 protective tariffs on aluminium and steel imports from all overseas suppliers.
The agreement last week did not disturb the Section 232 tariffs on aluminium and steel imported from India. Additionally, one final dispute between the US and India still remains at the WTO that relates to tariffs on poultry imported into India.