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U.S.-India Trade Dialogue Yields Additional Progress

Monday, November 02, 2015
Sandler, Travis & Rosenberg Trade Report

U.S. Trade Representative Mike Froman and Minister of Commerce and Industry of India Nirmala Sitharaman gathered in Washington, D.C., Oct. 29 for the ninth ministerial-level meeting of the India-U.S. Trade Policy Forum. According to a joint statement, the two governments reviewed substantive progress achieved this year in deepening bilateral trade and investment goals and discussed planned engagement for next year that can promote economic growth and job creation in both countries.

Froman and Sitharaman discussed a number of issues of special interest at the meeting, including agriculture, trade in goods and services, promoting investment in manufacturing, and intellectual property. The two officials were also briefed on the outcomes of ongoing discussions and plans for continued engagement in 2016. In addition, Froman and Sitharaman discussed the status of U.S. and Indian trade agreements with other countries as well as ways to ensure that bilateral trade and investment can continue to grow. They also agreed to hold a tenth TPF meeting next year in India.

Agriculture. The U.S. and India reviewed the results of the technical dialogues on plant and animal health that took place this year. They noted each other’s requests and agreed to follow up on exploring the possibility of enhanced market access on identified agricultural products. They also highlighted the importance of ensuring food safety and recognized the need to establish science- and risk-based regulations and procedures. The two sides committed to facilitate cooperation between their sanitary and phytosanitary enquiry points and share best practices on implementing risk-based approaches to food inspections. Froman and Sitharaman also noted progress in facilitating agricultural trade with India’s change to allow stickering of maximum retail price at the port. Moreover, India clarified that determination of wholesale and retail labeling requirements is not dependent on the weight of imported food consignments and took note of U.S. concerns regarding the import of boric acid into India.

Trade in Goods and Services. The two sides discussed efforts to promote foreign investment in key services sectors. The U.S. urged India to consider policy measures that would facilitate greater participation of foreign companies in service sectors and both countries reviewed technical engagement that took place in 2015. Froman welcomed India’s amended Insurance Act that increased foreign investment in the insurance sector from 26 to 49 percent, while India took note of U.S. concerns with the recently published guidelines on management control in the sector. Both countries agreed to continue to engage on this issue to ensure that insurance companies can take full advantage of this new market opening.

The U.S. also provided information on the positive correlation between investments in the e-commerce and retail sectors and the expansion of transport, logistics and warehousing infrastructure. India noted that its e-commerce regulatory regime is still evolving and that a white paper on direct selling prepared by the Indian Institute of Corporate Affairs is being discussed with stakeholders. Froman and Sitharaman pledged to explore further mechanisms, including technical discussions, to reduce trade costs across the health sector supply chain, including in pharmaceuticals and medical devices. Additionally, the U.S. noted the need for India to address the issue of export subsidies in the textile sector and both countries committed to participate in a technical discussion to address India’s concern regarding the inclusion of some of its products in the U.S. Department of Labor child and forced labor list.

Promoting Investment in Manufacturing. The U.S. and India discussed efforts that each country is undertaking to promote the ease of doing business in order to create a conducive environment for entrepreneurs and attract investment in manufacturing. They stressed the importance of providing a transparent and predictable policy environment and simplified compliance to help attract investments in manufacturing and discussed efforts to provide greater transparency and predictability in their policy formulation process, taking note of the benefits that can accrue from providing at least 30 days for public comment on proposed rules.

In addition, Froman and Sitharaman discussed efforts to increase supply chain connectivity and implement customs “single window” clearance systems that will benefit all manufacturing activities in both countries. They also acknowledged the need to deepen cooperation and work together to explore best practices and exchange experiences in matters related to standards, conformity assessment, accreditations, technical regulations, market surveillance programs and acceptance of results from conformity assessment bodies that have appropriately demonstrated competence in carrying out the requirements of technical regulations, including testing, certification and surveillance programs.

Intellectual Property Rights. The U.S. and India praised the increased engagement between technical and senior officials on intellectual property and reviewed the results of the dialogues that took place this year on copyrights, trade secrets, patents, traditional knowledge and the Traditional Knowledge Digital Library, standard essential patents, genetic resources and IP policies. The two sides reiterated the goal of ensuring the poorest populations in India and the U.S. have access to quality healthcare and committed to identifying ways in which trade and innovation policies can enhance access to quality health and affordable medicines. The U.S. and India also agreed to deepen copyright cooperation and will continue to exchange best practices and information on various issues. Furthermore, they agreed to explore increased interaction and cooperation at the operational level between their respective patent offices through enhanced exchange of best practices and IP data.

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