https://www.npr.org/2019/06/27/73653767 ... -trade-warOpinion: Don't Let U.S.-India Trade Differences Escalate Into A Trade War
ALYSSA AYRES, June 27, 2019
Secretary of State Mike Pompeo visited India this week as the Trump administration's first Cabinet-level envoy to the newly re-elected government of Prime Minister Narendra Modi. Pompeo's visit, ahead of Friday's Trump-Modi meeting at the G-20, occurred amidst tension: escalating trade differences threaten to overshadow recent progress in strategic ties.
It would be tragic if the Trump administration forgot why India matters to larger U.S. interests, and failed to reverse the slide into competitive trade grievances poisoning the atmosphere today. India — the world's largest democracy — has just become the world's fifth-largest economy, per recent International Monetary Fund data, and is now an increasingly active security provider in the Indo-Pacific region. It is an open Internet economy, a demographically young and aspirational country, and one sensitive to and already battling the effects of climate change. India is a crucial part of every major issue of the global commons, due to its sheer scale.
India famously charts its own diplomatic course, eschewing alliances and always focused on its independence. But China's greater assertiveness over the larger Indian Ocean region has helped draw New Delhi and Washington closer over the years, with a shared sense of the need to preserve a rules-based international order across this vital region. Successive U.S. administrations, since Bill Clinton's visit to India in 2000, have worked to deepen strategic ties, given both countries' shared commitment to what is now termed a "free and open Indo-Pacific." In 2016, India was named a Major Defense Partner of the United States, a unique designation created to bridge the gap between India's independence and a U.S. system built around alliances.
Yet convergent views on, say, freedom of navigation have never been matched by convergence on market access. Ask any U.S. trade negotiator, current or former, about India and the response will be a lengthy list of problems. The U.S. Trade Representative's annual National Trade Estimate on trade barriers illustrates the variety: high tariffs, price caps on medical devices, import bans, import quotas on things like peas, beans and lentils, food product approval problems, intellectual property rules, barriers to services industries and dozens of other specific issues.
Due to the complexity of some of these (don't ask about dairy), negotiators have worked for years to make incremental advances without notching complete successes. And in the past two years, the Modi government has shifted backward on market openness, with some increased tariffs on a few dozen goods, new regulations on e-commerce and a push for data localization in its growing digital economy.
Historically, India has not responded to sanctions (it withstood three decades of nuclear nonproliferation sanctions) and is unlikely to change its own decisions under threat of sanctions and tariff wars. So if the Trump administration now takes steps to sanction India due to its Iran procurements and its acquisition of the S-400 system from Russia, and then launches a special probe into India's market barriers, it will further escalate what has become an unnecessarily intensified trade spat. Moreover, the trade-war tactic has failed to solve old problems, has layered on new ones, and worse, has created doubts in India about Washington's reliability as a partner.
_______________________________________________________________________________________https://www.washingtonpost.com/world/tr ... a711366c36Trump doubles down on trade war with India
By Joanna Slater, June 27
NEW DELHI — President Trump believes trade wars are good and easy to win. Now he has a new target firmly in his sights: India.
En route to the Group of 20 summit in Japan on Thursday, Trump lobbed a fresh salvo at India, a country the United States has sought to cultivate as a friend and strategic partner. Trump tweeted that he was looking forward to speaking with Indian Prime Minister Narendra Modi at the summit “about the fact that India, for years having put very high Tariffs against the United States, just recently increased the Tariffs even further. This is unacceptable and the Tariffs must be withdrawn!”
Trump’s tweet came only a day after Secretary of State Mike Pompeo visited the Indian capital of New Delhi with the goal of calming tensions between the world’s two largest democracies, which include a nascent trade war. During his visit, Pompeo called for a “new age of ambition” in ties between India and the United States. But his talks with Indian officials did not generate tangible progress to bridge differences over trade.
Here’s a brief guide to Trump’s latest trade conflict:Why are the United States and India in a trade war?
There has been low-grade trade friction between the two countries for some time. Last year, Modi raised tariffs in a protectionist move viewed as currying favor with voters and businesses ahead of this year’s national election. Then bilateral talks to resolve narrow but long-festering issues — such as India’s price caps on certain medical devices — collapsed. Meanwhile, India said that it intended to require foreign companies to store data locally and announced a review of the rules around e-commerce, moves that alarmed U.S. technology and financial giants.