CUTS Washington Monthly Brief
#22, January 2020
Why Indo-U.S. trade package ought not to be high on expectations?
India and the U.S. are expected to soon announce a bilateral trade package. What’s there on the platter is yet to unfold. There are anticipations though that the deal will entail concrete plan of actions or decisions to address a number of trade irritants that keeps recurring. Secondly, it is expected provide some stimulus on achieving a long term vision that governs bilateral trade and economic relations.

A broader framework is important from the point of view of defining and addressing immediate and long term issues. The U.S. concerns about trade deficit with India are being met by increasing Indian imports of oil and gas, civil aviation and defence equipment from the country. This is likely to improve in proportion with advances made in government to government relations between the two countries.
It is now time for developing certain bigger plans and set a direction to long term trade and economic relations based on shared values, people to people contacts and geopolitical interests.

Let us hope that the deal would not be a disappointment for the businesses and people of the two countries as was in the case of the U.S.-China trade deal to civil society, policy makers and businesses, globally.

Sadly, the U.S.-China trade deal is widely rebuffed as a protracted and low impact agreement. Even though, the hopes from the phase two agreement that is likely to cover issues pertaining to Chinese State-owned Enterprises and industrial subsidies, among others, are greater but it is unlikely to take place before the U.S. presidential election this year.  A detente on the trade war will hopefully remain until then.

Wish the U.S. trade package with India is not the same in terms of delivery, given the nature and scale of bilateral partnership now and in the years to come.
Pradeep S. Mehta

P. S. President Trump is likely to visit India between February 24-26, 2020. We hope that other than a trade deal, it will further strengthen the Indo-U.S. relations in areas such as energy, defence, etc.

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Trump takes victory lap with USMCA signing
President Trump on Wednesday, January 29th signed the United States-Mexico-Canada Agreement (USMCA) in a ceremony on the South Lawn of the White House, celebrating a signature legislative accomplishment on trade. “Today, we are finally ending the NAFTA nightmare and signing into law the brand new U.S.-Mexico-Canada Agreement,” Trump said in remarks Wednesday morning.
In 2020, India & US must collaborate in WTO and beyond to counter China’s trade practices
The Trump administration believes it is now on a roll on trade, with deals on US-China and the US-Mexico-Canada Agreement (USMCA). Another deal is close to conclusion with India on a modest package of outcomes to solve several high priority market access problems. The US-India deal, assuming it is completed, will be hard to build on; although build, the two sides must.

Lighthizer to Talk Trade Deal With India Before Trump Visit
U.S. Trade Representative Robert Lighthizer will be in India in the second week of February to finalize a trade deal ahead of President Donald Trump’s expected visit, according to people with knowledge of the matter. India is keen to sign an agreement during Trump’s visit and trade minister Piyush Goyal has invited Lighthizer to discuss the details of a possible pact that has been stalled since before Prime Minister Narendra Modi’s U.S. visit in September.
The world is de-globalizing. Trump set the example
President Trump’s speech here at the World Economic Forum went over relatively well. That’s partly because Davos is a conclave of business executives, and they like Trump’s pro-business message. But mostly, the president’s reception was a testament to the fact that he and what he represents are no longer unusual or exceptional.


US Oil Exports Could Explode After Once In A Lifetime Power Shift In China
The consensus of opinion is that China’s commitment to buy an additional US$52.4 billion in U.S. energy products in 2020/21 as part of the Phase 1 trade deal between the two countries is impossible to achieve. The consensus is wrong, as a paradigmatic shift currently taking place in the core power structure of China means that the new energy products import targets are eminently achievable

More oil from the US? India’s energy security to be top priority when Trump-Modi meet
Discussions around India’s energy security will top the agenda during US President Donald Trump’s proposed visit to India this year. Though no specific dates have been announced for Trump’s visit, officials from various sectors of both countries have met frequently in recent months.

New Regulations Could Favor Oil Speculators
The Commodity Futures Trading Commission is preparing to release new oil speculation rules that would limit the number of positions hedge funds and other speculators can open on oil and other commodities, Bloomberg has reported, citing unnamed sources in the know.

Public Hearing Exemption for Hydrocarbon Exploration Makes a Bad Law Worse
In a procedural windfall for companies like the Oil and Natural Gas Corporation (ONGC) and Vedanta Ltd, the Union environment ministry has exempted hydrocarbon exploration activities from the rigours of the Environmental Impact Assessment (EIA) and public consultation through public hearings.


A multilateral alternative, by Asia
After a gap of 200 years, Asian economies are again larger than the rest of the world’s combined. As India and China resolve their border dispute, Asia is providing the multilateral alternative to a world divided by values, and no longer by ideology. The phrase ‘Asian Century’ is said to have arisen in the 1988 meeting between Chinese leader Deng Xiaoping and former Indian Prime Minister Rajiv Gandhi, re-establishing relations after the India-China border conflict in 1962.
2020 will be an important year for Indo-U.S. relations
As U.S. officials finalise venues and dates of President Donald Trump’s likely visit, an official said the focus of the Indo-U.S. engagements this year would be to implement decisions taken during the 2+2 meeting between Defence and Foreign Ministers in December 2019 and on trade.

Easternisation: War and Peace in the Asian Century by Gideon Rachman
The central theme of this excellent book by Gideon Rachman, chief foreign affairs commentator for the Financial Times, is what he terms “easternisation”: the remorseless shift in the global centre of gravity from the west to the east. His theme is not new; indeed, the book is something of a latecomer in this argument.

Trump’s Iran Imbroglio Undermines U.S. Priorities Everywhere Else
Shortly after taking office, U.S. President Dwight D. Eisenhower gathered senior advisers in the White House solarium to discuss policy toward the Soviet Union. In attendance was his hawkish secretary of state, John Foster Dulles, who had been a vocal critic of Harry Truman’s policy of containment and instead advocated an offensive policy whereby the United States would seek to “roll back” Soviet influence across Europe and Asia.


'India Can Very Much be a $5tn Economy by 2025': Amitabh Kant, CEO, NITI Ayog
“India becoming a US$5tn economy by 2015, though a tough ask, is very much doable” said Amitabh Kant, CEO of NITI Aayog, while speaking on the topic “Mainstreaming Innovation Towards $5 Trillion Economy” as part of Science-Innovation Lecture Series 2020, organised jointly by the Department of Science & Technology, Government of Rajasthan and CUTS International, on Saturday, 25th January, in Jaipur.
Many Challenges Await Taranjit Singh Sandhu, India's New Ambassador to the US
Hard as it might be to believe but Washington is a tough assignment for an Indian ambassador, the comforts and open access notwithstanding. The US government is a vast enterprise, actually a maze of departments within departments with overlapping responsibilities. The two co-equal branches – the executive and the legislative – can have maddeningly different perspectives.
Data localisation may cause cyber-attacks, hurt privacy, business competitiveness, says CUTS International
Data localisation, if implemented, without adequate preparation and accountability measures, may reduce freedom of speech while enhancing risks of censorship, privacy violations, data breaches and cyber-attacks, according to trade and regulatory think-tank CUTS International. According to a study titled Consumer Impact Assessment of Data Localisation (findings available here: conducted by CUTS, consumers perceiving higher risks showed lower levels of data usage.

7 of 10 ASEAN members favor China over US: survey
As the rivalry between the U.S. and China continues to heat up, Southeast Asians are split between the two superpowers, according to a Singaporean think tank, posing a challenge for a region that has sought unity to speed economic growth.