US Trade Policy agenda welcomes GST reform

The Dollar Business Bureau

The Trade Policy Agenda released by Trump administration for the year 2017 highlights the fast paced growth in US-India trade since 1980, when the total trade between the two nations was merely $4.8 billion. The US-India trade in goods and services has expanded by over 9% year-on-year to attain a figure of $109 billion in 2015, according to the document.

The trade policy expresses optimism over future progress in bilateral relations, as India pushes through tax and economic reforms. The goods and services tax is welcomed, for it will lower transaction costs and integrate the internal Indian market.

The annually released policy also said that India's new National Intellectual Rights Policy is expected to protect US innovations better. India's IP rights regime, especially in the pharma sector, has been the bone of contention in the negotiation of many foreign trade agreements.

The agenda was also openly critical of India's rising import tariffs over the years, which it blamed for the two countries not being able to increase trade volumes at a much higher rate.

"While these reforms are encouraging, there has also been a general trend of tariff increases in India, which reflects an active pursuit of import substitution policies," the document said.

The tone adopted is suggestive of the 'America first' mission, which is widely being promoted by the Trump Administration through multiple trade reform measures.

The policy draft talks about furthering bilateral plans that India and USA agreed upon during India Trade Policy Forum (ITPF) held in October 2016. These plans focus on increasing two-way trade in goods & services, and encouraging investment in agriculture and manufacturing.

Although the policy takes a note of progressive growth and development in India, it considers India's regulations and trade barriers as impediments to robust growth in trade between the two nations.