sanctions against it strictly. But though the deadline for India to stop
buying oil from Iran passed in end-May, it has not reacted sharply to In-
dia failing to completely cease the imports. More importantly, Chabahar
port in Iran, in which India has invested heavily – both financially and
diplomatically – has been kept out of the ambit of Iran sanctions as long
as the goods traded are not intended for Iran. India’s Chabahar invest-
ment was mainly to provide an alternative corridor for trade to land-
locked Afghanistan, by-passing Pakistan, and the US has no intention
of stopping that. So too, the US wants Chinese firm Huawei excluded
from Indian contracts, and India is going slow on including Huawei in
its forthcoming 5G spectrum rollout plan.
US President Donald Trump has continued to gripe about India’s
high tariffs, even tweeting about it hours before he met Prime Minister
Narendra Modi on the sidelines of the G20 summit in Osaka, Japan,
in end-June. India recently increased its tariffs on 28 products, includ-
ing almonds, apples and diagnostic reagents. India has stuck to its po-
sition, pointing out that its tariff increases are within the bound rates
and agreed mechanisms of the World Trade Organization, and that US,
too, has been raising its own tariffs on several products. India is also
upset about the tightening of norms in issuing H1B and business visas
to Indian professionals, the US stance on
patents and intellectual property rights and
its unwillingness to treat India as a devel-
oping economy for trade purposes. The US
has excluded India from its list of countries
entitled to concessional tariffs under its
Generalised System of Preferences. India’s
increase in tariffs is mainly in retaliation
for this, where Goyal has informed Parlia-
ment that India will gain $217 million as a
result. President Trump has been targeting
all economies with which the US has a trade
deficit, and that includes India, which had
a $20-billion goods trade surplus with the
US in 2018, but negotiations are on to end
these differences.Tightrope Walk
After Pompeo’s India visit and Modi’s
meeting with Trump in Osaka, trade rela-August 11 I 2019 I BUSINESS TODAY I 47