Abstract
This article seeks to provide answers to questions: why did India and the United States have a trade dispute under Trump and Modi administrations, and why were the two countries unable to resolve the trade dispute under Trump and Modi administrations? The article asserts that the primary reason for the trade dispute/disagreements between the two countries is the domestic economic and political environment and ideological considerations in the Trump and Modi administrations. This has manifested itself in a clash between Trump's ‘America first’ stance with the aim of ‘Making America great again’ and Modi's ‘Make in India’ initiative which envisions creating India as a manufacturing powerhouse and increasing the economic prosperity of Indian citizens. The article highlights each country's concerns and grievances regarding the other side's trade policies and what kind of trade access India wants from the United States and vice-versa.
Keywords
Get full access to this article
View all access options for this article.
References
1.
Ahmed
A
Kalra
A
Bose
N
(2019, January 24 ) Exclusive: U.S. voices concern as India's e-commerce restrictions hit Amazon, Walmart – sources. Reuters . Available at : https://in.reuters.com/article/india-ecommerce/exclusive-u-s-voices-concern-as-indias-e-commerce-restrictions-hit-amazon-walmart-sources-idINKCN1PJ0BI.
2.
Akhtar
SI
Kronstadt
KA
(2020, February 14 ) U.S.-India trade relations. Congressional Research Service . Available at : https://fas.org/sgp/crs/row/IF10384.pdf.
3.
Athukorala
P
(2020 ) Trump’s trade war: An Indian perspective . Asian Economic Papers 19 (1 ): 92 –109 .
4.
Ayres
A
(2020, February 13 ) A field guide to U.S.-India trade tensions. Council on Foreign Relations . Available at : https://www.cfr.org/article/field-guide-us-india-trade-tensions.
5.
Basu
N
(2021, January 5 ) Frictions & frustrations’ limit full potential of US-India trade ties — envoy Kenneth Juster. The Print . Available at : https://theprint.in/diplomacy/frictions-frustrations-limit-full-potential-of-us-india-trade-ties-envoy-kenneth-juster/579958/.
6.BBC (2019, September 23 ) India-US trade: Is Trump right about India's high tariffs? Available at :
https://www.bbc.com/news/world-asia-india-48961235
.
7.
Bhuyan
A
(2020, April 5 ) US government finds ‘Make in India’ for medical devices discriminatory. The Wire . Available at : https://thewire.in/trade/us-government-finds-make-in-india-for-medical-devices-discriminatory.
8.
Bown
CP
(2019, April 8 ) Trump's mini-trade war with India. Peterson Institute for International Economics . Available at : https://www.piie.com/blogs/trade-and-investment-policy-watch/trumps-mini-trade-war-india.
9.
Bump
P
(2020, October 20 ) Trump’s farmer bailout gave $21 billion to red counties and $2.1 billion to blue ones. Washington Post . Available at : https://www.washingtonpost.com/politics/2020/10/20/trumps-farmer-bailout-has-given-21-billion-red-counties-21-billion-blue-ones/
10.Business Today (2019, April 29 ) President Trump slams India on trade, says it imposes ‘high tariffs’ on American products. Available at :
https://www.businesstoday.in/current/economy-politics/donal-trump-india-tariff-king-india-uus-trade-tariff-on-americanproduct-u-spresident-trump/story/341546.html
.
11.Business Today (2020, February 23 ) US beats China to become India's top trading partner. Available at :
https://www.businesstoday.in/current/economy-politics/us-beats-china-to-become-india-top-trading-partner/story/396719.html
.
12.
Chaudhuri
R
(2014 ) Forged in crisis: India and the United States since 1947 . London : C Hurst & Co.) .
13.
Clarke
M
Rickett
A
(2017 ) Donald Trump and American foreign policy: The return of the Jacksonian tradition . Comparative Strategy 36 (4 ): 366 –379 .
14.
Desai
RD
(2019, April 30 ) India's data localization remains a key challenge for foreign companies . Forbes . Available at
15.Draft National E-commerce policy: India’s Data for India’s Development (2020, February 23 ) Department for the promotion of industry and international trade, Government of India . Available at
https://dpiit.gov.in/sites/default/files/DraftNational_ecommerce_Policy_23February2019.pdf?utm_source = nl_landingpage&utm_medium = web&utm_campaign = timestop10_daily_newsletter
.
16.
Gupta
S
(2019 ) India’s trade engagement: The more things change, the more they remain the same . International Studies Perspectives 20 (1 ): 14 –19 .
17.
Felter
C
(2020, July 7 ) U.S. Temporary foreign worker visa programs. Council on Foreign Relations . Available at
https://www.cfr.org/backgrounder/us-temporary-foreign-worker-visa-programs
.
18.FICCI (2020, July ) Development of dairy sector in India. Available at :
https://ficci.in/spdocument/23304/Development-Dairy-Sector.pdf
.
19.
Freund
C
Sidhu
D
(2017, May ) Manufacturing and the 2016 election: An analysis of US presidential election data . Peterson Institute for International Economics, Working Papers 17-7. Available at
https://www.piie.com/publications/working-papers/manufacturing-and-2016-election
20.
Gunjan
RK
(2019 ) Govt risks trade battle with US over religious opposition to dairy items from ‘non-veg’ cows. New 18.com . Available at :
https://www.news18.com/news/india/blood-meal-cattle-the-non-negotiable-sticking-point-as-us-scraps-indias-preferential-trade-treatment-2057333.html
.
21.
Haidar
S
(2020, February 18 ) No headway in India-U.S. trade talks. The Hindu . Available at : https://www.thehindu.com/news/national/no-headway-in-india-us-trade-talks/article30846772.ece.
22.
Hall
I
(2019 ) Modi and the reinvention of India’s foreign policy , 1st edition Bristol : Bristol University Press .
23.
Hopewell
K
(2020 ) Trump & trade: The crisis in the multilateral trading system . New Political Economy 26 (2 ): 271 –282 .
24.
Inamdar
N
(2022, August 25 ) Trade agreement: Why India made a U-turn on free trade deals. BBC . Available at :
https://www.bbc.com/news/world-asia-india-62559040
25.
Jain
D
(2018, August 1 ) Why do India and US disagree on farm subsidies? Live Mint . Available at : https://www.livemint.com/Politics/sIEswdOoThm3a1mGyDDGyN/Why-do-India-and-US-disagree-on-farm-subsidies.html.
26.
James
TC
Jaiswal
ABHA
(2020, April ) Medical devices industry in India local manufacturing and trade. Research and information system for developing countries . Available at :
https://www.ris.org.in/sites/default/files/Publication/Medical%20Devices_Report.pdf
.
27.
Jebaraj
P
(2020, February 8 ) Keep agri, dairy products out of trade deal with U.S., govt. told. The Hindu . Available at : https://www.thehindu.com/news/national/keep-agri-dairy-products-out-of-trade-deal-with-us-govt-told/article30771606.ece.
28.
Jha
R
(2020 ) Modinomics: Design, implementation, outcomes, and prospects . Asian Economic Policy Review 14 (1 ): 24 –41 .
29.
Kalra
A
(2019, July 11 ) Exclusive: Walmart told U.S. government India e-commerce rules regressive, warned of trade impact. Reuters . Available at :
https://in.reuters.com/article/walmart-india/exclusive-walmart-told-u-s-government-indias-e-commerce-rules-regressive-warned-of-trade-impact-idINKCN1U61ZW
.
30.
Kalra
A
Dasgupta
N
(2018, May 1 ) Exclusive: India rejects U.S. request on price caps on medical devices – sources. Reuters . Available at :
https://in.reuters.com/article/india-us-medtech/exclusive-india-rejects-u-s-request-on-price-caps-on-medical-devices-sources-idINKBN1I30BC
.
31.
Lalwani
S
Byrne
H
(2019 ) Great expectations: Asking too much of the US-India strategic partnership . The Washington Quarterly 42 (3 ): 41 –64 .
32.
Lalwani
S
Sagerstrom
T
(2021 ) What the India–Russia defence partnership means for US policy . Survival 63 (4 ): 149 –182 .
33.
Lange
J
(2019 ) Graphic: Factory woes grip swing states that flipped for Trump in 2016. Reuters . Available at :
https://www.reuters.com/article/us-usa-election-manufacturing-jobs-graph-idUSKCN1VC107
.
34.
Larres
K
(2020 ) Trump’s trade wars: America, China, Europe, and global disorder . Journal of Transatlantic Studies 18 : 103 –129 .
35.
Mastanduno
M
(2020 ) Trump’s trade revolution . The Forum 17 (4 ): 523 –548 .
36.MEA (2019, December 19 ) Joint statement on the second India-U.S. 2 + 2 ministerial dialogue, Ministry of External Affairs, India. Available at :
https://mea.gov.in/bilateral-documents.htm?dtl/32227/Joint + Statement + on + the + Second + IndiaUS + 2432 + Ministerial + Dialogue
.
37.MEA (2020, October 27 ) Joint statement on the third India-U.S. 2 + 2 ministerial dialogue, Ministry of External Affairs, India. Available at :
https://mea.gov.in/bilateral-documents.htm?dtl/33145/Joint + Statement + on + the + third + IndiaUS + 2432 + Ministerial + Dialogue
.
38.
Mishra
AR
(2019, February 25 ) E-commerce policy for data protection may further annoy US. Live Mint . Available at :
https://www.livemint.com/news/india/e-commerce-policy-for-data-protection-may-further-annoy-us-1551032545371.html
.
39.
Nair
AS
(2020, March ) E-commerce issues at the WTO discussions and in India. Research and information system for developing countries . Available at :
https://www.ris.org.in/en/node/307
.
40.
Nayar
R
(2019, May 18 ) India US trade dispute: Trade war better than a Trump truce. Media India Group . Available at : https://mediaindia.eu/business/india-us-trade-dispute/.
41.
Pandey
S
Arnimesh
S
(2020, March 14 ) RSS affiliate brings up religion to oppose US dairy imports, cites non-veg diet of cows. The Print . Available at : https://theprint.in/india/rss-affiliate-brings-up-religion-to-oppose-us-dairy-imports-cites-non-veg-diet-of-cows/368949/.
42.
Pant
HV
Joshi
Y
(2017 ) Indo-US relations under Modi: The strategic logic underlying the embrace . International Affairs 93 (1 ): 133 –146 .
43.
Parpiani
K
(2020, February 5 ) Understanding India–US trade tensions beyond trade imbalances . Observer Research Organization . Issue Brief No. 339. Available at :
https://www.orfonline.org/research/understanding-india-us-trade-tensions-beyond-trade-imbalances-61077/#_edn59
.
44.
Pattanayak
B
(2019, May 9 ) Will lose $3.2 billion if ICT tariffs scrapped, China will benefit, India tells US. Financial Express . Available at: https://www.financialexpress.com/economy/to-lose-3-2-billion-if-tariffs-scrapped-india-to-us/1572809/.
45.
Paul
J
(2019 ) US and India: Emerging offshore balancing in Asia . India Review 18 (3 ): 221 –242 .
46.
Prasad
GC
(2019, June 16 ) India’s retaliatory tariffs on 28 US products comes into effect. Live Mint . Available at :
https://www.livemint.com/politics/policy/india-imposes-tariffs-on-28-us-goods-as-global-trade-war-heats-up-1560616982719.html
.
47.RBI (2018 ) Storage of payment systems data. Available at :
https://rbidocs.rbi.org.in/rdocs/notification/PDFs/153PAYMENTEC233862ECC4424893C558DB75B3E2BC.PDF
.
48.
Schöttli
J
Pauli
M
(2016 ) Modi-nomics and the politics of institutional change in the Indian economy . Journal of Asian Public Policy 9 (2 ): 154 –169 .
49.
Seoane
MFV
(2021 ) Data securitisation: The challenges of data sovereignty in India . Third World Quarterly 42 (8 ): 1733 –1750 .
50.Srikrishna Committee (2018 ) Free and fair digital economy: Protecting privacy, empowering Indians. New Delhi, India. Available at : https://meity.gov.in/writereaddata/files/Data_Protection_Committee_Report.pdf
51.
Steff
R
Tidwell
A
(2020 ) Understanding and evaluating Trump’s foreign policy: A three-frame analysis . Australian Journal of International Affairs 74 (4 ): 394 –419 .
52.
Subramani
MR
(2020, February 17 ) Trump visit: US wants access to Indian dairy and chicken market but could settle for a watered down deal. Swarajya . Available at :
https://swarajyamag.com/world/trump-visit-us-wants-market-access-to-indian-dairy-products-and-chicken-legs-but-could-settle-for-a-watered-down-deal
.
53.
Suneja
K
(2018, December 24 ) India ready to allow US dairy imports with riders. The Economic Times . Available at :
https://economictimes.indiatimes.com/news/economy/foreign-trade/india-ready-to-allow-us-dairy-imports-with-riders/articleshow/67236873.cms?from=mdr
.
54.The Economic Times (2019, September 22 ) WTO dispute over India's tariffs on ICT goods: US seeks setting by up of dispute panel. Available at :
https://economictimes.indiatimes.com/news/economy/foreign-trade/wto-dispute-over-indias-tariffs-on-ict-goods-us-seeks-setting-by-up-of-dispute-panel/articleshow/71244023.cms
.
55.The Hindu (2018, April 3 ) US wants India to lift import ban on dairy products. Available at :
https://www.thehindubusinessline.com/economy/agri-business/us-wants-india-to-lift-import-ban-on-dairy-products/article20416523.ece1
.
56.
Trump
DJ
(2017, January 20 ) The inaugural address: Remarks of president. The White House . Available at : https://www.whitehouse.gov/briefings-statements/the-inaugural-address/.
57.US Census Bureau (2020, May 15 ) Trade in goods with India. Available at :
https://www.census.gov/foreign-trade/balance/c5330.html
.
58.US Department of State (2020, October 27 ) Highlights of 2020 U.S.-India 2 + 2 ministerial dialogue, Press Statement. Available at : https://www.state.gov/highlights-of-2020-u-s-india-22-ministerial-dialogue/#:∼:text = Secretary%20of%20State%20Michael%20R,Secretary%20of%20Defense%20Mark%20T.&text = During%20the%20meeting%2C%20Secretary%20Pompeo,for%20regional%20security%20and%20prosperity .
59.U.S.-India Trade Facts (2020, October 2 ) Office of the USTR . Available at
https://ustr.gov/countries-regions/south-central-asia/india
.
60.USTR (2018, April 12 ) USTR announces new GSP eligibility reviews of India, Indonesia, and Kazakhstan. Available at :
https://ustr.gov/about-us/policy-offices/press-office/press-releases/2018/april/ustr-announces-new-gsp-eligibility
.
61.USTR (2021, March ) Trade policy agenda and 2020 annual report. Available at :
https://ustr.gov/sites/default/files/files/reports/2021/2021%20Trade%20Agenda/Online%20PDF%202021%20Trade%20Policy%20Agenda%20and%202020%20Annual%20Report.pdf
.
62.
Verma
R
(2020a ) China’s new security concept: India, terrorism, China’s geostrategic interests and domestic stability in Pakistan . The Pacific Review 33 (6 ): 991 –1021 .
63.
Verma
R
(2020b ) The regional comprehensive economic partnership and India: A test case of Narendra Modi's statesmanship . Australian Journal of International Affairs 74 (5 ): 479 –485 .
64.
Verma
R
(2023 ) Introduction to the special issue on ‘India-US convergence/divergence during the Trump administration,’ India Review 22(2): 107–117 .
65.
Weinraub
M
(2020, October 19 ) Trump's payments to farmers hit all-time high ahead of election. Reuters . Available at :
https://www.reuters.com/article/us-usa-election-farmers-aid-idUSKBN2741D4
.
66.World Bank (2022 ) Tariff rate, applied, simple mean, all products (%) - India. Available at : https://data.worldbank.org/indicator/TM.TAX.MRCH.SM.AR.ZS?locations=IN.
67.Zee News (2018, February 27 ) Donald Trump says ‘getting nothing’ after India reduces tariffs on motorcycles. Available at :
https://zeenews.india.com/international-business/donald-trump-says-getting-nothing-after-india-reduces-tariffs-on-motorcycles-2084725.html
.