Ahead of US President Donald Trump’s visit to India in which a trade pact is likely to be signed, there is a widespread belief that at a time when he has to face the electorate, it is the US that needs the deal more than India. Analysts are of the opinion that India has been suffering a number of unilateral trade-distorting steps inflicted by the US.
While a number of trade issues are currently being discussed in back-channel trade negotiations, Swadeshi Jagaran Manch (SJM) – an ally of Rashtriya Swayamsewak Sangh (RSS), the ideological mentor of India's ruling BJP - believes that “free trade cannot be one-sided”.
In the ongoing trade negations, the US is seeking entry into India's dairy as well as the agriculture sector, which RSS and its affiliated groups are concerned about and want adequate safeguards.
In an exclusive interview with Sputnik, SJM’s national co-convenor Ashwani Mahajan said India’s trade surplus with the US is not because New Delhi is doing something wrong, but because American industries are going down.
Sputnik: There is a strong possibility that a trade pact between India and the US may be signed during US President Trump's visit to India. What are your expectations from the deal?
Ashwani Mahajan: Ever since Trump took over as president there has been a big change in the US approach to trade, with regard to unilateral increase in tariffs for many countries and not really cooperating with the World Trade Organisation on the dispute settlement mechanism. Without the dispute settlement mechanism, the WTO has no meaning.
Unilateral decisions by the US declaring that India is no longer a developing country and depriving immunity to exporters with regard to the impact on American industries can open a Pandora’s Box. Sovereign nations are independent to take decisions. But we believe free trade is not one-sided. There cannot be a situation wherein we continue with free trade while others are imposing barriers. Various actions have been taken by the US, like GSP withdrawal, which it is free to do.
Sputnik: Apart from GSP, there are other issues like dairy, and agriculture, among others. Negotiations are currently going on. What kind of decisions do you expect in these sectors vis-a-vis the trade pact?
Ashwani Mahajan: On dairy, there are religious and cultural issues, with regard to the import of milk and milk products. We understand that cows in the US are fed with meat and blood. So, this is a cultural issue in India. We consider milk to be a vegetarian product. If such milk comes to India, people will be hurt culturally, religiously, and emotionally. So this is again non-negotiable.
Yes, if the US agrees to provide a certification that they are not exporting non-vegetarian milk, it should be considered. On agriculture, the US has been giving so many subsidies. We can’t keep on importing commodities in a way that the farmers are hurt. Unlike the US, our farmers are not big but subsistence farmers. Their livelihood depends on the price that they get. A decision on trade in agricultural produce from the USA has to be taken from this vantage point.
Sputnik: Recently, a tariff on medical devices was also an issue. There is also a concern in the US on taxes on medical equipment imports introduced in the annual budget.
Ashwani Mahajan: Medical expenses of Indians have been rising. Coronary stents have now been brought under price control. Stents are now priced at INR 30,000 ($422) under price control, against INR 150,000 (about $2,112) earlier. It is an extra burden on somebody who has suffered a heart attack. People are forced to sell their lands, or assets to meet medical expenses.
Narendra Modi's government has rightly taken the decision to cap the prices of stents and knee caps. Indian industry is now really doing well in terms of the domestic production of medical implants and equipment. It has broad ramifications for India’s public health security. Also, very importantly, I have never heard price control in any country becoming a matter of trade negotiation. It has never been the case. The decision of the government on the medical equipment front is a conscious decision. We have seen people benefitting from it.
Sputnik: The automotive sector, specifically the tariff on Harley Davidson, has been a major concern of the US. Even President Trump called India the “tariff king” due to high duties on the vehicle.
Ashwani Mahajan: If we are imposing higher tariffs and we can negotiate on that, we do not have any problem. It does not make much of a difference to us. Our automobile industry is quite developed. So that can be negotiated.
Sputnik: So, what are your expectations from the ongoing trade negotiations?
Ashwani Mahajan: I don’t see much possibility in terms of the issues that are on the table. Deals happen only when things are negotiable. The US must understand that so many deals are in the pipeline. We are going to purchase more than 300 Boeing planes from them. This is not a small thing. We may have a trade surplus with the US, but it is not because India has done something wrong rather because over the years American industries have come down. So, we hope with the efforts of President Donald Trump US industries may revive and become self-dependent.
