Trade A Big Friction Between India And U.S., Says White House

Trade is one aspect of India-U.S. relationship that has the most friction, a senior White House official said even as he underlined that the Trump Administration is looking for a "free, fair and reciprocal" trade with India.

The comment from White House came after President Donald Trump publicly raised the issue of high import duty levied by India on high-end motorcycles at least three times in a month and threatened a reciprocal duty on Indian exports to the US.

Also Read: Anand Mahindra Doesn't Fear Trade War as World Needs India

"The commitment to the relationship is very strong on both sides. If you had to point to a part of the relationship where you have the most friction, it certainly would be the trade side," a senior administration official said.

The official spoke on condition of anonymity to give a clarity on the various aspects of the U.S. ties in South Asia, including India.

Insisting that the Trump Administration has been clear for a free, fair and reciprocal trade, the official said that there has been concerns raised about the trade deficit with India.

But he quickly pointed that this trade deficit has actually come down slightly more recently, based largely on India's imports of US energy.

“This administration is looking for a free, fair and reciprocal trade with India. And so is seeking to see some of those tariffs such as on a Harley Davidson motorcycles that are there. US is determined to find the opportunities to increase trade investment with India and does expect that there will be some sort of reciprocal dealings on the trade issues,” the official said.

The senior administration official noted that Indian motorcycles that are imported into the US don't have any tariffs on them.

"And so the president has been clear that he's looking for a fairly reciprocal trade with India," the official said.

Responding to a series of question, the official said the Trump Administration has been on constant talks with India on trade issues.

Foreign Secretary Vijay Gokhale, who was in Washington DC this week met the US Trade Representative Robert Lighthizer.

At the same time the official indicated that trade issues is unlikely to be part of the soon to be held two plus two dialogue between the two countries involving their respective foreign and defense ministers.

In the absence of the Secretary of State, the two-plus-two dialogue has now been delayed and is likely to be held later this year after Mike Pompeo is confirmed by the Senate.

"I think, it's an ongoing discussion that we're having on the trade issues. The two plus two is focused a great deal on a defense security cooperation, diplomatic political cooperation just by virtue of the Defense Minister and Defense Secretary and the External Affairs Minister and Secretary of State. The trade issues are more of an ongoing dialogue that we're having with India," the official said.