India's Economy To Get 'Double Boost' If Trade Talks Are Resolved: FICCI

India and US are keen to reset their trade ties that witnessed stress in the last few weeks after Donald Trump doubled tariffs on Indian goods. Last week, PM Modi said that India and the US are 'natural partners' and that teams from both sides are working to conclude negotiations on the bilateral trade deal.

The prime minister's comments came in response to US President Donald Trump's remarks that efforts are on to address 'trade barriers' between the two countries. The US President had also said that he was looking forward to speaking to PM Modi in the 'upcoming weeks' and sounded confident that both sides would be able to seal the proposed trade deal.

In the current scenario, Harsha Vardhan Agarwal, President FICCI, Vice Chairman & MD, Emami told NDTV Profit in an exclusive interview that he is confident of government resolving the ongoing trade talks with the US.

Harsha Vardhan Agarwal told NDTV Profit that the Indian economy will get a 'double boost' if trade talks are resolved between India and US, after the government's recent next-generation GST reforms. GST 2.0 is set to give a major boost to India's consumption and spur economic growth in the near-term.

The industry players expect that shifting to a new GST regime with reduced duties on FMCG products will boost consumption. However, it will trigger a 'short-term disruption' due to existing stocks under the current tax regime.

GST reforms have lowered tax rates on 375 items across various sectors including auto, FMCG, apparel, textiles, etc. The GST Council, in its meeting on Sept. 3, approved a two-tier structure of 5% and 18%, with a special rate of 40% on the tobacco and related products as well as ultra-luxury items.

On Sept. 6, PM Modi 'deeply' appreciated Trump's 'positive assessment' of India-US partnership after the American leader hailed the 'special' relationship between the two nations and said there is 'nothing to worry about'.

The relations between India and US was on a major downturn after Trump doubled tariffs on Indian goods to a whopping 50% including a 25% additional duties for India's purchase of Russian crude oil. India had described the US tariff action as 'unfair, unjustified and unreasonable'.