US – India Relations: President Trump To Sign New Trade Deal With Indian PM Modi?

Source: International Business Times

22nd September 2019


resident Donald Trump is set to meet Indian Prime Minister Modi on Sunday at an Indian-American rally in Houston called “Howdy Modi!” Although both nations are engaged in a tense tariff battle, some believe the two leaders could hash out a trade deal by the end of the month when both attend the United Nations General Assembly on Tuesday.

“There’s a push to get something done with India, with an eye for UNGA,” a Washington-based source told Reuters.

For Modi, Sunday’s meeting in Texas is a way to connect with the Indian diaspora in the U.S., while at the same time showing that he is a leader respected in the world’s most powerful country. Over 50,000 people are expected to be at the “Howdy Modi!” rally.

Trump, on the other hand, wants to boast of his strong diplomatic relationship with India and possibly gain support from Indian-Americans in his bid for re-election. The Indian population in the U.S. is over 4 million.

But Modi may want to make a trade deal, as India’s economic growth has slowed down to 5% in the second quarter of 2019, the lowest rate in six years. India was stripped of its special trade status in May, which exempted India’s products, such as washing machines and solar panels, from U.S. tariffs.

India has also been hit hard by U.S. tariffs on steel and aluminum. In retaliation, India in June imposed tariffs on 28 products, such as American apples and lentils.

Sen. Lindsey Graham of South Carolina said in August that India is “the worst” in terms of tariffs on American products, while Trump has lambasted the country’s tariffs on Harley-Davidson motorcycles, as well as whiskey.

“We’re hopeful that the Houston events can be bolstered by some real progress on the trade front that shows the U.S. and India can negotiate some reasonable solutions,” said Roger Murry, Deputy Director of the Alliance For Fair Trade With India.

Trump has also initiated tariffs on China and the European Union. He has referred to himself as “tariff man,” while seeking new trade deals that he believes would make the international market fairer for American exports.

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