India Inc. Hopes For A ‘Mini’ Trade Deal During Donald Trump’s Visit

India Inc. expects tangible outcomes from U.S. President Donald Trump’s maiden visit to the country later this month, including a bilateral “mini” trade deal and higher investment commitments from American companies, industry groups said on Sunday.

The two countries are negotiating a trade package to iron out certain issues and promote two-way commerce.

India is demanding exemption from high duties imposed by the U.S. on certain steel and aluminium products, resumption of export benefits to certain domestic products under the Generalised System of Preferences, and greater market access for its products from sectors like agriculture, automobile, auto components and engineering.

On the other hand, the U.S. wants greater market access for its farm and manufacturing products, dairy items and medical devices, data localisation, and a cut in import duties on some information and communication technology products. The U.S. has also raised concerns over high trade deficit with India.

“Expectations remain high on achieving a bilateral 'mini' trade deal, which hopefully lays the foundation for a more comprehensive economic partnership,” Confederation of Indian Industry Director General Chandrajit Banerjee said. “As Indian industry enhances its investment and job creation in the U.S., we expect an interaction of President Trump with leading Indian companies operating in the U.S.”

“Trade negotiators from India and the U.S. have been working hard to add value to the bilateral economic engagement, leveraging on their mutual advantages. As Prime Minister Narendra Modi hosts Trump to a national reception, the two leaders would give a decisive lift to bilateral ties,” Assocham Secretary General Deepak Sood said.

At the invitation of Prime Minister Modi, Trump is slated to travel to India on Feb. 24 and 25. According to sources, Trump will meet the country's top business leaders here on Feb. 25 in a bid to push for deeper trade and business ties.

A roundtable with prominent India chief executives will be organised to facilitate a meeting between the U.S. president and corporate honchos in the national capital. Senior bureaucrats are also expected to attend the meeting, besides top executives from American corporations.

Business leaders including Mukesh Ambani, Sunil Bharti Mittal, N Chandrasekaran, Anand Mahindra, AM Naik and Kiran Mazumdar Shaw are expected to attend the roundtable with Trump, one of the sources said, adding that the U.S. Embassy in New Delhi is coordinating the event while the list of attendees has been shared with the White House for clearance.

Research by CII shows that at least 100 Indian companies have invested nearly $18 billion and created over 1,13,000 jobs in the U.S.

“There have been several recent announcements by Indian companies, that have shown the growing impact Indian investment can have on U.S. economy and society, and we fully expect that to increase. Likewise we expect even higher investment commitments from U.S. companies into India,” Banerjee said.

“Most of the Fortune 500 U.S. companies have an overwhelming presence in India, while leading Indian corporates in manufacturing and services have expanded their foothold across the U.S. market. When it comes to goods, the US is finding greater market access in India, as is reflected in the trade data,” Sood added.

In 2018-19, India's exports to the U.S. stood at $52.4 billion, while imports were $35.5 billion. Trade deficit dipped from $21.3 billion in 2017-18 to $16.9 billion in 2018-19.

India received FDI worth $3.13 billion from the U.S. in 2018-19, higher than $2 billion in 2017-18.