Kolkata: The Centre has said that reports of the government suspending the proposed trade deal with the US even as the Donald Trump administration has launched a new “unfair practices” probe against India and some other countries is incorrect and misleading. The clarification followed reports on Friday by Reuters that New Delhi will tarry the finalisation of the bilateral trade deal after White House announced launching the trade investigation.
On Friday Reuters stated that New Delhi has decided to pause the proposed trade deal with the US for several months after the Trump administration launched a probe against trading partners including India and China to look into ‘unfair foreign practices’. An interim trade agreement between the two countries was expected to be signed in March, after which the full trade deal was to be finalised.
Piyush Goyal rejects report
“We have noted a media report regarding ongoing trade talks with the US. It is denied that there is any hold off in bilateral engagement. It is reiterated that the two sides remain engaged for a mutually beneficial trade agreement,” the commerce ministry said in a statement.
“We have a very good trade agreement with the United States of America. We have been able to protect all our sensitive sectors,” commerce and industry minister Piyush Goyal said at an event on Friday as he denied the media report.
India a target
The trade investigations which have been initiated by the US are supposed to examine whether 16 countries, which includes India, adopt “unfair foreign practices” which result in cheap goods that are eventually imported by the US and end up harming the American manufacturers and eliminate jobs in the US. The trading partners against which these investigations have been targeted are India, China, Japan, the European Union, Bangladesh, Cambodia, China, the European Union, India, Indonesia, Japan, Korea, Malaysia, Mexico, Norway, Singapore, Switzerland, Taiwan, Thailand and Vietnam.
According to United States Trade Representative Jamieson Greer, the probe will take up the “acts, policies, and practices” of various economies under Section 301(b) of the Trade Act of 1974, relating to structural excess capacity and production in manufacturing sectors. A statement from the US Trade Representative stated the probe will determine whether those acts, policies, and practices are unreasonable or discriminatory and burden or restrict US commerce.
Use of forced labour
The US has also initiated another probe against 60 countries to find out whether they employ forced labour in the production of goods that are eventually sold to the US. India also features on this list along with China, the EU and Mexico.
“Despite the international consensus against forced labor, governments have failed to impose and effectively enforce measures banning goods produced with forced labor from entering their markets… These investigations will determine whether foreign governments have taken sufficient steps to prohibit the importation of goods produced with forced labor and how the failure to eradicate these abhorrent practices impacts U.S. workers and businesses,” Jamieson Greer said in a statement.
Possible timeline of new tariffs
Donald Trump is in a hurry and wants to impose new tariffs this summer itself. He hatched the plan to impose fresh tariffs to replace the retaliatory tariffs that the US Supreme Court trashed as unconstitutional on Feb 20. After the apex court turned down the US president’s pet economic weapon of higher tariffs around the globe, he has been searching for new avenues to impose fresh ones. The US government is now facing the daunting prospect of returning as much as $175 billion collected via the illegal tariffs.