January 24, 2020 / 12:21 PM / 2 months ago

EXCLUSIVE-U.S. pushes India to buy $5-6 bln more farm goods to seal trade deal-sources

    * India, U.S. work on trade deal ahead of Trump India visit
    * U.S. wants India to buy more from U.S. agri firms
    * India deal likely similar to one with China-source

    By Aditya Kalra and Neha Dasgupta
    NEW DELHI, Jan 24 (Reuters) - The United States wants India
to buy at least another $5-6 billion worth of American poultry
and farm goods if New Delhi wants to win reinstatement of a key
U.S. trade concession, four sources familiar with the talks told
    U.S. President Donald Trump cited trade barriers last year
when removing India from its Generalized System of Preferences
(GSP) programme that allowed zero tariffs on $5.6 billion of
exports to the United States. In retaliation, India slapped
higher tariffs on more than two dozens U.S. products.
    Ahead of a Trump visit to New Delhi to meet Prime Minister
Narendra Modi next month, negotiators on both sides are  
hammering out terms for a trade deal that would include New
Delhi rolling back higher tariffs on some farm goods such as
almonds, walnuts and apples, one of the sources said.
    Both governments had hoped to work out a limited trade deal
last year, but struggled to reach an agreement.             
    India's commerce ministry and the U.S. Embassy in New Delhi
did not respond to a request for comment. The office of the U.S.
Trade Representative did not immediately respond outside regular
business hours.
    While India has offered a partial relief on medical device
price caps that have hurt American pharma giants and a roll back
in tariffs on some U.S. goods, Trump's team wants a sweetener of
$5-6 billion in additional trade for U.S. goods to restore GSP
privileges, three of the sources said.
    That demand was conveyed by the United States to India in
late December, said two sources.
    As part of the negotiation, the U.S. wants India to increase
imports of frozen poultry products, the first source said. The
U.S. has already been pushing India to cut the high import taxes
on poultry products.
    "The deal has to be agriculture focused, the U.S. is putting
a number on everything (if India wants GSP back)," said one of
the sources.
    The sources asked not to be named due to the sensitivity of
the discussions. 
    Other than the agriculture sector, the United States could
be swayed if some of that additional revenue goes to its energy
sector, said one of the sources. 
    Indian oil minister Dharmendra Pradhan this week said India
was looking forward to extending its energy cooperation with the
United States and other countries, but didn't disclose any
planned deals.
    Trump is likely to visit India in late February, in what
would be his first visit to the South Asian nation since he took
office three years ago.             

 (Reporting by Aditya Kalra and Neha Dasgupta; 
Additional reporting by Alexandra Ulmer, Nidhi Verma; Editing by
Euan Rocha and Toby Chopra)
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