India seeks US tariff relief, offers corn and energy imports
What's the story
India and the US are currently in the process of negotiating a trade deal. As part of these negotiations, India has proposed buying corn from the US for ethanol production and increasing its energy purchases. The proposal comes as New Delhi seeks to have the 25% penal tariffs on Russian oil imports removed by Washington. These tariffs were imposed by the US over India's alleged role in funding Russia's war against Ukraine through its oil purchases.
Trade dynamics
Exploring corn imports for ethanol production
The US has also been pushing India to increase its purchases of American soybeans and corn. However, India has been hesitant due to concerns over genetically modified (GM) varieties. Despite these challenges, an official said that "fresh offers have been made" and "there is discussion to buy corn for ethanol production." The move is significant as it shows India's willingness to explore new avenues in the trade negotiations.
Negotiation strategy
Red lines regarding agricultural market access
While the talks are ongoing, India is firm on its red lines regarding market access in the agricultural sector. The country wants to protect its farmers and prevent GM products from entering the food chain. An official said "the talks are on track and we are trying to meet the fall deadline, but the date and venue of the next round of negotiations is yet to be finalized."
Diplomatic discussions
First in-person meeting since penal tariffs announcement
The Indian delegation, led by Piyush Goyal, has met US Trade Representative Jamieson Greer and US ambassador-designate to India Sergio Gor. This was their first in-person meeting since the announcement of the 25% penal tariffs on August 27. The two sides are negotiating a Bilateral Trade Agreement (BTA), which they had initially aimed to conclude by fall. So far, five rounds of negotiations have been held for this pact.
Business engagement
Indian delegation meets US-based businesses and investors
Apart from meetings with US government representatives on bilateral trade matters, the Indian delegation also held discussions with key US-based businesses and investors. These talks were aimed at promoting trade and investment between India and the US. The ministry said these meetings evoked a positive response as business leaders expressed confidence in India's growth story and their desire to intensify business activities in India.