Union Commerce and Industry Minister Piyush Goyal on Saturday described the trade agreement between India and the United States as a very important step in the journey towards becoming a Viksit Bharat.
“The bilateral trade agreement has been signed looking at the future by the two leaders (PM Narendra Modi and President Donald Trump),” Goyal said at a press conference organised to share the details of the India-US Joint Statement on the Interim Trade Agreement released on Friday.
The deal is aimed at achieving USD 500 billion bilateral trade annually, Goyal said, adding the interests of farmers and dairy industry have been completely safeguarded.
The joint statement finalised late last night has brought about a wave of happiness and optimism across the country among common citizens and various sectors, he said further.
The minister said the US has agreed to the first part of the trade deal to strengthen bilateral ties with India. He stated that overall tariffs have been brought down from 50 per cent to 18 per cent.
The tariffs on India are now lower than all competitive countries in the region, he said further, pointing out that the US tariffs on China are about 35 per cent, about 20 per cent on Vietnam and Bangladesh, etc.
Zero duty on many products
According to Goyal, many Made-in-India products will attract zero duty.
“Gems and diamonds, pharmaceutical products will attract zero duty. Smartphones and many other items will continue to attract zero duty in the future as well. Many agricultural exports will also attract zero reciprocal tariff in future like spices, tea, coffee, coconut and coconut oil, vegetable wax, cashew nut, etc. Many types of fruits and vegetables like avocado, mango, banana, guava, pineapple, mushrooms, some types of cereals, some bakery products, and many processed food items will also attract zero tariffs,” Goyal told the press.
“Many other Indian exports on which reciprocal tariff will be reduced to zero include aircraft and machinery parts, pharma products including generic drugs, gems and diamonds, clocks and watches, essential oils, some home decor items, inorganic chemicals, instruments and apparatus, paper, plastic and wood items etc. Silk products will also attract zero duty,” he added.
Agri and dairy interests protected
The minister specifically pointed out agricultural and dairy products on which no concessions or relaxations have been provided under the deal.
“No GM (genetically modified) crops will be imported. No concessions have been made on meat, poultry, maize, dairy items, soyabean, rice, wheat, sugar, millets like jowar, bazra and ragi. There will be no concessions on fruits grown in ample quantity in India like banana, strawberry, cherries, citrus fruits, green peas, kabuli chana, moong etc.
“Animal feed products like groundnut, honey, non-alcoholic beverages, essential oils, ethanol, tobacco – no concessions have been made on these items under the deal,” the minister announced.
“I say with full confidence that this deal between India and the US protects the interests of farmers, MSMEs, handlooms and handicrafts. It, in fact, provides opportunities in American markets to the youth, women, those involved in toys, leather and textiles, sports goods industries etc,” Goyal stated further.
Rejecting the opposition’s charge on alleged compromises made in agreeing to the trade deal with the US, the Commerce and Industry Minister said there are some people in the country who are against the interests of the farmers. “They don’t worry about the farmers’ interests, but they mislead the public of the nation. They are surprised to see that no steps have been taken in the India-US trade agreement that go against the interests of the farmers of the nation,” the minister said.
He further asserted that all those products on which India is self-reliant have been kept out of the purview of the agreement.
On US imports into India, Goyal said, “We have opened our markets for the US on some products like Distiller’s Dried Grains with Solubles (DDGS), wines and spirits in which we have kept a minimum import price also.”
India to get AI chips, data centres
On the question of the US supplying ICT products, Goyal stated that America has agreed to supply these items, adding India and the US are not competitors, but they complement each other.
“That is more directed towards safeguarding our interest from countries which are known to do predatory pricing or supply goods at irrational prices, which are even sometimes lower than the cost of manufacture in India. A country like the United States of America, where the cost of labour is probably 50 times the cost of labour in India, which has a per capita income of USD 90,000 compared to India where it is at USD 3,000 per capita. There is certainly no competition. We actually complement each other,” Goyal said.
The minister pointed out that for national security, India needs many ICT products.
“For example, NVIDIA chips. We will certainly need AI equipment. We will certainly need data centres if we have to remain abreast with what is happening in the world, if our IT companies have to reorient themselves to become more in tune with the needs of the world. We will need these important ICT products. It is a big win for India that America has agreed to provide us all these ICT products which are the need of the hour in our country,” the minister said.
When asked whether India will stop buying oil from Russia, the minister said the Ministry of External Affairs will provide details on the same.