India-U.S. Bilateral Trade Agreement Negotiations
India is negotiating with the United States to remove non-tariff barriers (NTBs) to facilitate better market access for its exporters in the ongoing bilateral trade agreement (BTA) talks. The focus is on addressing regulatory hurdles and related costs that affect Indian exports.
Challenges Faced by Indian Exporters
- Regulatory Hurdles: Indian industries have highlighted issues such as high certification costs and regulatory challenges as significant barriers.
- FDA Approval Costs: The Food and Drug Administration (FDA) approval for Indian pharmaceutical exporters ranges from $9,280 to over $540,000, while U.S. exporters face lower costs in India.
- Buy American Policy: This policy limits Indian companies' access to U.S. government procurement contracts.
- Certification Delays: Time-consuming certification processes in the U.S. for Indian pharmaceutical exporters, including costs for FDA field visits, act as NTBs.
Non-Tariff Measures (NTMs)
Although NTMs like sanitary and phytosanitary measures relate to health and safety norms for food and agriculture products, there is often a thin line between them and NTBs.
U.S. Concerns and Negotiation Stance
- The U.S. aims to reduce NTBs in its trade negotiations and has raised concerns over various Indian policies, including the Digital Personal Data Protection Act and data localization.
- Other issues include mandatory testing and certification of telecom equipment and differential tax treatment of foreign companies.
Recommendations and Suggestions
India seeks the easing of U.S. authorization processes to reduce compliance costs, suggesting that delays or rejections should come with justifiable reasons to support transparency and fairness in trade.