India's move to increase tariffs on US goods could translate into a bigger threat of higher duties on products that India exports in large volume, said Jayant Dasgupta, former Indian ambassador to the World Trade Organisation (WTO).
“In the interest of trade, because the US is our largest trading partner, accounting for more than 16 percent of our overall merchandise trade and an equal proportion of our services, we cannot afford to have a fight with them in the open," said Dasgupta.
The government on June 16
raised custom duty on various items, including walnut and apples, exported from the US in retaliation to the withdrawal of the generalised system of preferences (GSP) benefits.
"We have to accommodate those American requests in which we have some elbow room and which does not affect our national interest adversely or our overall position globally in an adverse way,” he further mentioned.
Dasgupta anticipates that the Trump administration would turn heat on India in response in some form or the other. It remains to be seen whether that would be more tariffs other products of India, he added.
“The data localisation and other eCommerce related issues are under discussion not only on a bilateral basis with the US but in the WTO there are discussions on this, papers have been floated and separate groups have been formed of which India is not a part," he said.
They are trying to force together an agreement of the coalition of the willing and to then bring in India and other countries into it by sheer force but that is some distance off, said Dasgupta.
First Published: Jun 17, 2019 3:07 PM IST