After concluding a "quick" trade deal, India and the US need to sit down on the negotiating table for working towards a more sustainable, robust and enduring partnership in the form of a free trade agreement (FTA), Commerce and Industry Minister Piyush Goyal said.
For the FTA, the minister said, India is willing to work with an open mind, with a willingness to open markets with a corresponding opportunity for Indian businesses in the US.
"I believe we have a quick trade deal which has some of the pending matters built up over the last couple of years which we need to get out of the way quickly. We are almost there. I think another couple of calls and we should be able to solve that out.
"Post that, as was already intimated to the US Congress, the US and India need to sit down on the negotiating table, I do not know if that can be done before the (US) elections or post the elections, but we need to work towards a much more sustainable, a much more robust, a much more enduring partnership in the form of a FTA," he said in a webinar of US-India Business Council.
Goyal said that both the countries should also look for a preferential trade agreement (PTA) which can include 50-100 products and services. While in a PTA two trading partners eliminate or significantly reduce import duties on a limited number of goods traded between them, in a FTA the countries remove duties on maximum number of products.
"We believe we should also look at an early harvest in the form of a PTA, so that we can rather than waiting for the gains of a FTA, which may take several years to conclude, we could look at an early harvest of maybe 50 or 100 products and services, where we can engage with mutual trust and open spirit. So that the partnership between the US and India can kick start much faster," he added.
India and the US are negotiating a limited trade deal with a view to ironing out differences on trade issues to boost economic ties. India is demanding exemption from high duties imposed by the US on some steel and aluminium products, resumption of export benefits to certain domestic products under the Generalized System of Preferences (GSP), and greater market access for its products from sectors such as agriculture, automobile, automobile components and engineering.
On the other hand, the US wants greater market access for its farm and manufacturing products, dairy items and medical devices, apart from cut in import duties on some information and communication technology products. The US has also raised concerns over trade deficit with India.
Further the minister stated that the government is taking several steps to further improve the business climate to attract investors. He said businesses are looking for a stable and predictable policy environment, fair play, ease of doing business, better infrastructure in terms of logistics, utilities, and common facilities required for manufacturing firms.
"By enlarge industry and business wants to be left alone, wants freedom to operate and is willing to commit itself to work within the framework of a country's laws. And I think India is working towards making all of these enablers...whether it is ease of doing business, whether it is improving our competitive edge, bringing down logistics cost, making it easier to get approvals. All of this typical needs of business which we in government are trying to address," he said.
He added that there is an opportunity and a trust deficit available globally and India is willing to fill that gap in the international supply chain as a trusted partner. Talking about formulation of the single window clearance process, he said a team is working on this by understanding the needs of businesses, their pain points and requirements.
"We are understanding industry pain points and their requirements. We are trying to create such a genuine single window, and not a window behind which it opens to 10 doors. It is a herculean task, will take some time but I assure you that we are committed to make it happen," the minister said.
To begin with one of the first things that on a pilot basis, the government is going to release "very soon" is a GIS based land bank availability across the country, he said adding "we have identified in six states a few hundred thousand hectares of land and we are actually going to offer you a Google earth view of particular lands available for industry to buy.
Taking it forward from there so much so that my intention is that a person sitting in Iceland should be able to not only locate the land he wants but also pay for it and buy it".
"I will give you a simple example of how I am explaining it (single window process) to my own officers. I said look at the common application form that a student who applies to US university has to fill up. It's eight universities, one form, small supplement to each...," he added.
The minister also said that India has become self-sufficient in ventilators and "I shortly be starting export of ventilators". In March, the government banned export of ventilators in wake of the coronavirus outbreak. The US remained India's top trading partner for the second consecutive fiscal in 2019-20.
According to the data of the commerce ministry, in 2019-20, the bilateral trade between the US and India stood at USD 88.75 billion, as against USD 87.96 billion in 2018-19. The US is one of the few countries with which India have a trade surplus.
The trade gap between the countries has increased to USD 17.42 billion in 2019-20 from USD 16.86 billion in 2018-19. In 2018-19, the US had surpassed China to become India's top trading partner.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
