Interview/ Mark Linscott, former trade negotiator with the Trump administration & senior adviser, US-India Strategic Partnership Forum
Q/ How would you describe this deal?
My perspective is a very positive one. I think it was really important that it happened. It probably took too long to get done. But it was clear that the two leaders had to engage directly on it for it to get done. It’s a huge deal for both of them. Overall, I think both sides did quite well.
India ended up with a pretty good deal. A lower tariff than what is applied to every other country in Asia, with the exception of Singapore, which has a trade deficit with the US.
Q/ What are the interesting features that will help both sides?
From the US side, it is elimination of a lot of tariffs. And again, we’ve got to wait to see the details. President Trump claimed that he got zero tariffs pretty much across the board. I don’t think that’s the case. But he got the best deal that India has ever offered on tariffs, and probably better than what was agreed with the EU. That can be beneficial in many sectors, from chemicals to industrial machinery to electronics, engineering goods and med tech.
There will be meaningful results on agriculture as well, not the sensitive issues like dairy, GM crops, corn or soybean, but some other important products that were a little less sensitive for India to open up on.
What has really not been done yet is the services sector, and particularly digital. I think that’s coming down the road.
On the Indian side, I have to start with textiles and apparel. The US market is huge. A 50 per cent tariff was clearly causing a lot of pain. It is good that it got fixed before things got any worse. (Coming to) other labour-intensive industry (like) marine exports, frozen shrimp etc, it seems like the government had done a very good job of trying to find some replacement markets while the 50 per cent tariff was in place. But it’s hard. So I think there can be resumption of that trade at a tariff that makes it still possible to export. We will see how it plays out. But I think this truly could be a win-win.
Q/ We are yet too see the full bilateral treaty agreement (BTA).
It is only the first step towards a comprehensive BTA. So, once they complete the finalising of the legal text for this first phase (of the) agreement, they move on to the next phase. It will be a process. But it is really important that this is an aspiration of a comprehensive agreement versus a lot of the agreements on reciprocal trade that the Trump administration is doing with other countries. This is the most ambitious negotiation of all of those that the Trump administration has been working on.
Q/ There is always some uncertainty with President Trump.
With President Trump, anything is possible. South Korea is a really good example of that. The UK is feeling the heat as well. We had the situation with Greenland and eight European countries. It is going to be unpredictable going forward. But the US and India have a strong vested interest in making this work.