India-US Trade Talks: Energy and Personal Ties May Avert Tariffs
New Delhi, India - Indian Prime Minister Narendra Modi will visit the White House today for pivotal trade discussions with President Donald Trump. While tariffs remain a significant agenda item, other factors may mitigate the imposition of new duties between the world's largest and fifth-largest economies.
Energy as a Key Bargaining Chip
India is a major importer of US energy, particularly oil and gas. Experts believe changes to this arrangement could significantly impact the tariff negotiations. "Trump views these issues transactionally," states Shayak Sengupta, director of the India program at Columbia University's Center on Global Energy Policy.
Personal Connection and Symbolic Gestures
Modi's long-standing personal connection with Trump could also favor India. Sengupta notes that India has not approached this presidency with "nervousness" compared to the European Union. Additionally, Modi has already initiated discussions on reducing tariffs on US goods, such as Harley-Davidson motorcycles.
Non-Tariff Barriers and the Trade Deficit
Experts expect non-tariff trade barriers to be another key issue. The US can effectively implement these barriers through regulations or subsidies. However, India's growing trade deficit with the US remains a concern for Trump and his administration.
Potential for a Trade Agreement
Despite these challenges, many anticipate a trade agreement is possible. Sengupta emphasizes the importance of the broader trade landscape, cautioning against focusing solely on tariff rates.
Conclusion
India's energy dependence, personal connections, and willingness to address non-tariff barriers may provide leverage in the upcoming trade talks. While it remains to be seen if these factors will significantly alter the trade landscape, they could potentially avert the imposition of new tariffs between the two nations.