Will new US trade representative be good for Indian business?

By Mahua Venkatesh

New Delhi, Nov 12 (SocialNews.XYZ) As US president-elect Joe Biden is set to take charge in January 2021, all eyes are set on the US Trade Representative (USTR). The appointment of USTR will be particularly critical, especially in the wake of an emerging world order amid the ongoing Covid-19 pandemic. The formidable Robert Lighthizer is the current USTR, appointed by incumbent US President Donald Trump in 2017.

Prior to the US Presidential election, Biden had sought advice on trade and economic policies from several experts. Speculation is rife now on who would be appointed as the next USTR. Much of the trade policies, which will be examined with a fine tooth comb in the coming months, will depend on the USTR.

"Speculation is swirling in Washington, DC, about which one of them could replace Robert Lighthizer, the Trump administration's powerful U.S. Trade Representative, or be named to a top economic post if Biden wins in November," a Reuters report in June said.

"The appointment of the USTR will be crucial and once there is clarity (on that), we would get to know the course of future action and policies relating to trade," Sanjaya Baru, economist and once media adviser to former prime minister Manmohan Singh, told IndiaNarrative.com.

Lighthizer, known for his stern approach, was of the belief that various US trade agreements have primarily favored other economies.

Foreign policy experts opined that while the Biden administration is likely to follow the broader contours of trade policy already chalked out by Trump, the new president could take a softer stand on tariffs.

Senior journalist and foreign policy expert Pramit Pal Chaudhuri pointed out that Biden's policies could be protectionist in nature.

"The US [under Biden] could revoke more of the less smart policies implemented by Trump but by and large he will remain a protectionist though he might rework the tariffs that had been set. Tariff as a trade tool is outdated," Chaudhuri said.

In June Biden had called for "a $400 billion, four-year increase in government purchasing of US-based goods and services plus $300 billion in new research and development in US technology concerns," CNBC reported. The president-elect also underscored the importance of 'Buy American principle to boost the health of US companies.

Earlier, Lighthizer who described India as a "troublesome trading partner," also said that free trade had lifted millions of people in countries including India and China out of poverty.

In a major setback to the president-elect, who is perceived to be more conciliatory in nature, the European Union just announced the imposition of $4 billion in tariffs on US goods. The Trump administration, last year, had executed $7.4 billion in tariffs on goods made in Europe.

However, experts expect Biden to take a softer approach on tariffs.

According to Peterson Institute for International Economic (PIIE), Trump imposed tariffs of 25 per cent on $761 million of steel and of 10 per cent on $382 million of aluminum imported from India. "Combined, these tariffs covered roughly 2.3 percent of India's exports to the United States in 2017," the PIIE study said.

In case Biden decides to take a softer stand on tariffs, India could actually benefit.

(This content is being carried under an arrangement with indianarrative.com)

Source: IANS