Donald Trump is confident that the US and India will reach a trade deal soon even as though his administration’s proposal to impose fresh tariffs on the South Asian nation complicates ongoing negotiations.
“We will get to a deal because I like your prime minister a lot,” Mr Trump told reporters at the White House on Thursday. “He is a good friend of mine. We get along great and we’re going to make a deal.”
His comments came after a US delegation, led by chief negotiator Brendan Lynch, held several days of talks in Delhi this week to finalise an interim trade agreement.
India’s commerce ministry said the talks were marked by “a spirit of cooperation and pragmatism” and that the two sides remained committed to reaching a mutually beneficial trade pact.
While the American delegation was still in Delhi, however, Washington proposed an additional tariff of 12.5 per cent on goods from more than 50 countries, including India, Australia, China, Japan, and Israel, claiming that they were using forced labour.
The proposal by the US Trade Representative’s office came on the second of three days of talks between Indian trade officials.
India “has failed to impose and effectively enforce a forced labour import prohibition”, the office said in a 92-page report on Tuesday that called the South Asian nation’s policies unreasonable and a burden on US commerce.
“The failure of our most important trading partners to address the importation of goods made with forced labour is unacceptable,” US trade representative, Jamieson Greer, said.
“This creates a dynamic where American workers are forced to compete globally on an unlevel playing field.”
India said the US trade representative would consider public comments before making a final decision on the proposed tariff.
Mr Trump, meanwhile, repeated his criticism of India’s trade policies. He said the South Asian nation had for years charged “tremendous tariffs” on American goods while facing no equivalent barriers in return. He cited Harley-Davidson motorcycles as an example, saying high Indian tariffs had forced their American manufacturer to build its own plants in the country.
“They sold motorbikes here, too. You know how much we charged them? Nothing. And now it is the exact reverse,” he said.
India was one of the first countries to open trade talks with the US after Mr Trump’s sweeping tariff announcements last year. The two sides agreed on a framework for an interim deal in February, and India committed to buying $500bn worth of US goods, including energy, aircraft and agricultural products. The deal had been expected to be finalised in March but talks stalled after the US Supreme Court struck down many of Mr Trump’s tariffs, ruling them illegal.
The US levied tariffs of up to 50 per cent on some Indian goods before cutting them to 18 per cent in February and again to 10 per cent after the top court’s ruling. The two sides have been renegotiating the deal since.
