In blow to China, Team Trump advances India trade deal

: World Tribune; 23 April 2025; Hits: 9

by WorldTribune Staff, April 23, 2025 Real World News

U.S. Vice President Vance and Indian Prime Minister Modi on Tuesday announced the terms of reference for a bilateral trade agreement between the United States and India.

“This announcement elevates significant work done since February 13, 2025, when Prime Minister Modi visited President Trump and the two agreed to launch negotiations for a bilateral trade agreement,” the Office of the United States Trade Representative said in a press release.

During a meeting with Modi in the northwestern Indian city of Jaipur, Vance warned of “dire” consequences in the Indo-Pacific and a “dark time” for the world if the U.S.-India partnership should fail.

“Critics have attacked my president, President Trump, for starting a trade war in an effort to bring back the jobs of the past, but nothing could be further from the truth,” Vance said, referring to Trump’s aggressive tariff policies and commitment to revitalize U.S. manufacturing. “He seeks to re-balance global trade so that America, with friends like India, can build a future worth having for all of our people together.”

A U.S.-India trade agreement would come as a huge blow to China.

“This audience knows better than most: Neither Americans nor Indians are alone and looking to scale up their manufacturing capacity,” Vance said. “The competition extends well beyond cheap consumer goods and into munitions, energy infrastructure and all sorts of other cutting-edge technologies. I believe that if our nations fail to keep pace, the consequences for the Indo-Pacific, but really the consequences for the entire world will be quite dire.”

President Donald Trump and Modi announced in February that the U.S. and India aim to double bilateral trade to $500 billion by the end of the decade.

The United States ran a $45.7 billion goods trade deficit with India in 2024, a 5.1% ($2.2 billion) increase over 2023. U.S. total goods trade with India was an estimated $129.2 billion in 2024.

India’s average applied tariff is 17%, among the highest of the world’s largest economies, while the U.S. average applied tariff is 3.3%.

India’s average applied tariff rate on agricultural products is 39% while the U.S. average applied tariff on agricultural products is just 5%.

In addition to tariffs, technical barriers to trade, regulatory barriers, and restrictions on access to the market in the services, industrial, and agricultural sectors also reduce U.S. exports to India.

On April 2, “Liberation Day,” Trump moved to level the playing field as he imposed a 10% tariff on all countries and individualized reciprocal higher tariffs on nations with which the U.S. has the largest trade deficits.

The goals of the U.S. India initiative announced on Tuesday “are to drive transformative change across key pillars of cooperation and commit to a results-driven agenda with initial outcomes this year to demonstrate the level of trust for a mutually beneficial partnership,” the Trade Representative press release said.

“The Terms of Reference announced today by Vice President Vance establish a roadmap for mutually beneficial, multi-sector Bilateral Trade Agreement negotiations. Goals for the United States include increasing market access, reducing tariff and non-tariff barriers, and negotiating a robust set of additional commitments to ensure long-term benefits.”

Vance noted: “We believe a stronger India means greater economic prosperity. But also greater stability across the Indo-Pacific, which is, of course, a shared goal for all of us in this room. I believe that if India and the United States work together successfully, we are going to see a 21st century that is prosperous and peaceful. But I also believe that if we fail to work together successfully, the 21st century could be a very dark time for all of humanity.”

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In blow to China, Team Trump advances India trade deal, WorldTribune.com