During Indian Prime Minister Narendra Modi's State Visit to the United States, India and the US reached an agreement to resolve six trade disputes at the World Trade Organization (WTO).
As part of the agreement, India has agreed to lift retaliatory customs duties on 28 American products, including almonds, walnuts, and apples.
The US had previously imposed import duties on certain steel and aluminium products in 2018, citing national security concerns, which led to India imposing customs duties on American products in retaliation.
The announcement was made by United States Trade Representative Katherine Tai, who highlighted that the resolution of these disputes and the removal of tariffs would expand market opportunities for US agricultural producers and manufacturers.
Tai expressed satisfaction with the culmination of bilateral engagement between the two countries over the past two years, particularly through the US-India Trade Policy Forum, which aimed to strengthen economic and trade ties.
She also expressed her willingness to work with India's Commerce and Industry Minister, Piyush Goyal, to explore further avenues for collaboration and economic integration.
The six disputes that have been resolved include countervailing measures on specific hot-rolled carbon steel flat products, measures related to solar cells and modules, measures pertaining to the renewable energy sector, export-related measures, certain measures on steel and aluminum products, and additional duties on certain US products.
Trade experts suggest that both countries can mutually resolve these disputes and inform the WTO about the agreed terms.
Previously, the US had lodged a complaint with the WTO regarding India's support measures for its export sector under various schemes.
In 2019, a WTO dispute panel ruled that India's export measures were inconsistent with global trade norms. The resolution of these disputes between India and the US is seen as a positive step towards strengthening their trade relationship.
The US is India's largest trading partner, and bilateral goods trade between the two countries reached USD 128.8 billion in 2022-23, compared to USD 119.5 billion in the previous year.
According to WTO rules, if a member country believes that a trade measure violates WTO norms, they can file a case with the organization.
Bilateral consultation is the first step in resolving a dispute, followed by the option to approach the establishment of a dispute settlement panel if consultations are unsuccessful.
However, the appellate body of the WTO is currently non-functioning due to disagreements among member countries regarding the appointment of its members.
The resolution of these trade disputes is expected to create a more favorable environment for trade between India and the US, benefiting both countries' agricultural and manufacturing sectors.
It also reflects a willingness on both sides to engage in dialogue and find mutually acceptable solutions, which is crucial for maintaining a strong and sustainable trade relationship.