Trade deal with US as important, says India after ‘mother of all deals’ with EU

NEW  new delhi:  republic of india and the US feature made “ real important” progress in talks for a bilateral trade agreement, and Indian negotiators have remained in contact with their American counterparts to work toward a positive outcome even as they conclude the mega trade deal with the European Union (EU), people familiar with the matter said on Wednesday.Most of the discussions for the trade deal with the US, which has been stalled since President Donald Trump hit Indian goods with 50% tariffs last year, have been completed, and the pact needs to be cleared by the top leadership on both sides to get across the line, the people said on condition of anonymity.The free trade agreement with the EU, concluded during the India-EU Summit on Tuesday, shouldn’t be seen as a response to the overall downturn in relations with the US, as the American market is as important as the EU market for India, the people said.“As far as the US deal is concerned, we have made very significant progress on that. We are very close to seeing it come to fruition. The two sides remain in touch,” one of the people said, noting that Indian trade negotiators were in contact with their US counterparts even in the final stages of negotiating the FTA with the EU.“That work is continuing. We are hopeful of a positive outcome,” the person said.External affairs minister S Jaishankar’s trip to Washington on February 4-5 to attend the US-led inaugural ministerial meeting on critical minerals is expected to set up a bilateral meeting with secretary of state Marco Rubio. The visit could also help advance efforts to finalise a bilateral trade deal, the people said.The ministerial meeting will focus on strengthening supply chains for rare earths. India is also expected to join Pax Silica, the flagship US initiative to build a secure global semiconductor and AI supply chain.India and the US held several rounds of discussions last year to finalise the proposed trade deal, but the negotiations hit a roadblock after Trump slapped a 25% reciprocal tariff on Indian goods, and followed it up with a 25% punitive levy on Russian oil purchases.Bilateral relations were also hit by other issues, including Trump’s repeated claims of brokering a ceasefire to end the brief but intense conflict between India and Pakistan last May, the tightening of immigration regulations by the US and constant criticism by senior American officials of India’s energy and defence ties with Russia.In the face of reports that negotiations between India and the EU for the FTA were spurred over the past few months by the disruptive trade and tariff policies of the US, the people said this factor was not mentioned by either side during the India-EU Summit on Tuesday.“India’s exports to the EU are worth $76 billion, compared to $86 billion for the US. The US is an equally important market for us,” a second person said.“Exports to both should grow because that will create jobs and more manufacturing. The US market is as important, if not more important, and we have to keep our eyes on the ball in terms of getting the US trade deal across the finish line.”In China’s context, people said India has no plans to review its decision not to join the Regional Comprehensive Economic Partnership (RCEP) for now. India had walked away when the 10 Asean member states and five other countries, including Australia, China and Japan, signed the RCEP in 2020 over a range of economic concerns.They noted that EU member states, which view China as a partner, a competitor, and a rival, have begun readjusting and recalibrating their China policy in light of security, economic, and energy interests to reduce over-dependence and build resilient supply chains.