USTR Says US-India Trade Not Living Up to Potential; Lawmakers Push for GSP Return

U.S. Trade Representative Katherine Tai said she hears frequently from stakeholders about "market access restrictions, high tariffs, unpredictable regulatory requirements, and restrictive digital trade measures" in India, and said those are issues "where we need to make progress."

Tai, speaking in India at a welcome reception, said, "There is huge potential for growth between our two economies in areas like the digital economy, services, health-related trade, and even agriculture." She also said, "India and the U.S. also face shared challenges in areas like climate change, vulnerable supply chains, and promoting market-oriented principles and structures. These areas are ripe for closer collaboration."

Trade Minister Piyush Goyal, who tried to reach a trade deal with USTR officials during the Trump administration to regain access to the Generalized System of Preferences benefits program, praised Tai at the same event. He called her "a master of trade acumen," and said her achievements are legendary. He told her that when he met with her at the G-20 trade ministers meeting and in videoconferences, he saw her compassion, and said she understands the challenges of working toward sustainable development, "trade amongst unequal partners," and agricultural subsidies. "I've found you are a very keen listener," he said, and predicted she would deftly handle the challenges at the World Trade Organization.

Later, at the U.S.-India Trade Policy Forum (TPF), Goyal said, "I hope that together we can revitalise the forum to engage and resolve outstanding issues in an amicable manner, and send a strong message to the world that India-US partnership is stronger than ever before."

Seventy members of the U.S. House of Representatives, led by Rep Suzan DelBene, D-Wash., the leader of the pro-trade New Democrat Coalition, wrote to Tai just before she arrived in India, encouraging her to advance negotiations on the market access issue that led to India being kicked out of the GSP. "We strongly encourage you to create a framework for a deal that could be implemented soon after Congress reauthorizes the GSP program. Given the broad range of India’s trade practices that impact U.S. exporters, such a framework may not resolve all market access barriers in India. Recognizing this, we note that the GSP statute authorizes partial reinstatement of GSP benefits; accordingly, if India were to meet the program’s eligibility criteria, we encourage you to examine restoring GSP benefits for India commensurate with the extent of its market-opening actions. We believe that incremental but meaningful steps can help build momentum for future TPF successes."