Washington, Feb 19 (NationPress) The recently unveiled India-US trade framework represents a positive shift that may pave the way for substantial export advantages for both nations, enhance supply chain integration, and revitalize the wider strategic partnership, according to a former US Commerce Department official.

Atman Trivedi, a Partner at DGA-Albright Stonebridge Group and former Senior Director for Policy in Global Markets at the US Commerce Department who was instrumental in establishing the US-India Strategic and Commercial Dialogue, emphasized that the agreement opens new opportunities for businesses in both countries.

“This is a positive development. The trade agreements are poised to unlock significant export benefits for both nations and aid small and medium-sized enterprises across markets,” Trivedi mentioned during an interview with IANS.

He elaborated that the framework opens critical sectors on both sides. “For the US, it facilitates access to essential Indian sectors, including all industrial goods. For India, it aligns with the Prime Minister’s manufacturing aspirations, enhancing the scope for US exports,” he stated.

Trivedi noted, “We can anticipate an increase in Indian products entering the US, which is already India's largest export destination. This should provide a boost for 'Make in India' initiatives aimed at global markets.”

For the US, the agreement reduces longstanding tariff barriers within the Indian market. “Historically, India has maintained high average applied tariff rates. The reduction in these barriers should simplify the process for US businesses to penetrate India’s market, the largest globally by population,” he added.

From India's standpoint, Trivedi described this as “an exceptional opportunity.” He highlighted the expanded market access for “textiles, vital items such as gems and jewelry, and leather.” He viewed it as a “major opportunity from an Indian perspective to increase sales in what is already India’s largest global market.”

Regarding trade-offs, he mentioned that India made “a considerable concession” by lowering tariffs, in some instances reaching “zero on industrial goods.”

Conversely, the US has agreed to reduce tariffs from 50% down to 18%.

This transition grants India a competitive advantage. “Countries like Vietnam, Malaysia, Indonesia, Bangladesh, and Pakistan face higher tariffs on their exports to the US compared to India. This provides India with a significant edge moving forward,” he stated.

He argued that liberalizing India’s market would facilitate deeper integration into global supply chains and “diminish its dependencies on countries with which it has more adversarial relations.”

The agreement also outlines ambitious procurement targets, including India’s pledge to acquire goods and services worth $500 billion. Trivedi indicated that energy and defense will be pivotal.

“I believe India will ramp up its purchases of energy and defense supplies, given our shared strategic interests in the Indo-Pacific region,” Trivedi remarked.

He also mentioned “civilian aircraft, such as Boeing planes,” and various industrial sectors.

However, he cautioned that achieving the $500 billion target is ambitious. As of 2024, India imported over $87 billion in US goods, making it a substantial challenge to reach the goal within five years.

“Whether we can attain $500 billion in five years remains uncertain,” he noted.

Beyond tariffs, Trivedi pointed out that non-tariff barriers continue to be a concern for US companies operating in India, including “compulsory licensing demands, conformity assessment regulations, standards issues, and localization requirements.”

On the Indian front, tensions are more significant in “services, mobility, and the accessibility of skilled workers to the US economy.”

Regarding H-1B visas, he acknowledged the political sensitivities involved. “Even lawful immigration and skilled immigration have become contentious issues. I’m unsure if this will be addressed during bilateral trade discussions. However, it is certainly a concern in the larger relationship,” he stated.

When asked about the prolonged negotiations, Trivedi attributed it to longstanding trade disputes and geopolitical interruptions, including the conflict between India and Pakistan in May which he said “derailed our progress.”

Looking ahead, he anticipates renewed energy in the relationship. “I foresee increased momentum in our partnership. I believe this is a positive step,” he said.

He expects to see benefits spilling over into “technology collaboration,” “defense partnerships,” and “energy cooperation,” and mentioned the opportunity to accelerate in areas that had previously slowed due to trade disputes consuming much of the focus.

The United States and India have progressively deepened their economic and strategic ties over the past two decades, with bilateral trade achieving record heights in recent years. While trade has often been a point of contention, defense and technology relations have strengthened.

Both nations have identified each other as key partners in the Indo-Pacific. The latest trade framework is seen as a move to align economic collaboration more closely with their strategic alignment.