India is set to benefit from a proposed US trade deal, but the country is seeking to gain a tariff advantage before finalising the agreement. According to reports, India will only implement the trade deal after reducing tariffs on some US imports, including agricultural products and pharmaceuticals.
This move has significant implications for the UK, which has trade ties with both India and the US. The UK has a strong trade relationship with India, with bilateral trade valued at over £23 billion in 2022, and a significant proportion of this trade is in the form of services.
India's decision to seek a tariff advantage could impact the UK's trade ties with both countries. The UK's Department for International Trade has not commented on the issue, but the Foreign Office advises against all but essential travel to India due to the ongoing COVID-19 pandemic.
The proposed US-India trade deal is expected to increase bilateral trade between the two countries, with the US Trade Representative's office estimating that the deal could increase US exports to India by up to 24%. However, India's decision to seek a tariff advantage could impact the UK's access to the Indian market and its ability to export goods and services to the country.
The UK's trade relationship with the US is also significant, with bilateral trade valued at over £174 billion in 2022. The UK's decision to leave the EU has led to a significant increase in trade with the US, with the UK now enjoying tariff-free access to the US market under the UK-US trade agreement.
India's decision to seek a tariff advantage before implementing the US trade deal is likely to be closely watched by trade experts and policymakers in the UK. The move could have significant implications for the UK's trade ties with both India and the US, and may impact the country's ability to export goods and services to these markets.