Indo-US ties: USTR lists India specific trade barriers

From agricultural subsidies to intellectual property rights to technical standards, the United States Trade Representative (USTR) has listed out wide ranging issues across sectors that are harming US trade interests in its business with India.

USTR's 2018 National Trade Estimate Report on Foreign Trade Barriers (NTE), published as a companion piece to US President Donald Trump's 2018 Trade Policy Agenda on March 30, talks about a dozen such areas that pose trade barriers for US companies.

These sectors could be the focus of India-US trade talks in future as the Trump administration gets down to correcting existing trade imbalances with its trade partners and promoting local manufacturing to replace imports.

NTE identifies several 'technical barriers' that are harming the export prospects of American companies engaged in the manufacture of toys, electronics and information technology goods, telecommunication equipment, packaged food items, and in areas like biotech crops, livestock genetics, dairy and alcoholic beverages. It considers India's food testing and standards as a means of creating sanitary and phytosanitary barriers for pork and poultry exports. Tariffs and other charges on imports, import licenses and customs procedures were also a concern. 

The US accuses India of pursuing discriminative policies to protect its domestic services - insurance, banking, audiovisual services, legal, telecommunication services, etc. Barriers to entry included India's remote access policy, satellite services and distribution services. Data localisation, technology, internet services like intermediary liability, taxation and electronic commerce figured as barriers to digital trade.

The US list of India specific issues comes at a time when it is improving its trade balance with India.

The NTE points out that US goods trade deficit with India was USD 22.9 billion in 2017, a 5.9 percent decrease (USD 1.4 billion) over 2016. US goods exports to India were USD 25.7 billion, up 18.7 percent (USD 4.0 billion) from the previous year. Corresponding US imports from India were USD 48.6 billion, up 5.6 percent.

According to NTE, India was the 15th largest goods export market for US in 2017. US exports of services to India were an estimated USD 23.1 billion in 2017 and imports were USD 28.7 billion. Sales of services in India by majority US-owned affiliates were USD 24.5 billion in 2015 (latest data available), while sales of services in the US by majority India-owned firms were USD 14.7 billion. US foreign direct investment (FDI) in India (stock) was USD 32.9 billion in 2016 (latest data available), a 10 percent increase from 2015. US direct investment in India is led by professional, scientific and technical services, manufacturing and wholesale trade.

NTE is the 33nd in an annual series that highlights significant foreign barriers to US exports.