Monthly Commercial Report · 2020. 6. 17. · P a g e | 1 India – U.S. Trade Analysis India-U.S....

P a g e | 1

India – U.S. Trade Analysis

India-U.S. bilateral merchandise trade during the period of

January – October 2016 was $56.54 billion, a marginal decline

of 0.5% as compared to the same period in 2015. Despite this

decline, Indian exports in pharmaceuticals grew by 26.8%,

precious stones by 16.8%, and fish and Crustaceans by 13.5%

during this period. India-U.S. bilateral trade in services during

the period January – September 2016 (period for which data

is available) was $33.75 billion, an increase of 9.6% over the

corresponding period in 2015.

| Embassy of India - Washington D.C |

Commerce Wing

Monthly Commercial Report __________________________________________________________________________

President-elect Trump and his

trade agenda...………………..p.10

Trump outlines policy plan for

first 100 days …………………..p.10

Trump nominates Secretary of

Commerce …...……………….. p.11

US DOC makes affirmative

preliminary determination in an

investigation on Carbon Steel

Flanges from India .………... p.14

Paul Ryan re-nominated by

Republicans as Speaker...… p.15

USIBC makes recommendations

to President-elect on India-US

strategic partnership……..…p.17

Canada willing to renegotiate

NAFTA…………………………….. p.21

November 2016

P a g e | 2

India – US Bilateral Merchandise Trade

2183

1

2407

3

2570

4

2116

6

2953

3

3615

6 405

14

4181

0 4535

5

4479

2

3901

5

9674

1496

9

1768

2

1644

1

1925

0

2150

4

2210

5

2181

1

2150

1

2145

2

1752

5

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

50000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Jan. - Oct. 2016

India's Exports to U.S. India's Imports from U.S.

2012 2013 2014 2015 Jan. – Oct. 2016

India’s Exports to US 40514 (12.1) 41810 (3.2) 45355 (8.5) 44792 (-1.2) 39015 (1.3)

India’s Imports from US 22106 (2.8) 21810 (-1.3) 21501 (1.4) 21452 (-0.2) 17525 (-4.4)

Total Trade 62619 (8.6) 63620 (1.6) 66856 (5.1) 66244(-0.9) 56540 (-0.5)

Balance of Trade in India’s favor

18104 20000 2385423340 21490 (6.5)

Source: US Department of Commerce, US Census Bureau

(US

$ M

illio

ns)

Percentage change over previous period, mentioned in parenthesis

(US $ Millions)

India – US Bilateral Trade in Services

7054

9950 1

2654

1222

2 1471

1 1737

6

1877

3

2038

7 2235

9 2469

3

1973

6

6546

8653 10

043

9977

1032

2

1178

0

1230

8

1331

8

1518

0 181

07

1601

6

0

5000

10000

15000

20000

25000

30000

2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 Jan. - Sept. 2016

India's Exports to U.S. India's Imports from U.S.

(US

$ M

illio

ns)

(US $ Millions)

Percentage change over previous period, mentioned in parenthesis *Latest data available Source: US Department of Commerce, US Census Bureau

2012 2013 2014 2015 Jan. – Sept. 2016*

India’s Exports to US 18773 (8.0) 20387 (8.6) 22359 (9.7) 24693 (10.4) 19736 (7.7)

India’s Imports from US 12308 (4.5) 13318 (8.2) 15180 (14.0) 18107 (19.3) 16016(12.1)

Total Services Trade 31081 (6.6) 33705 (8.4) 37539 (11.4) 42800 (14.0) 35752 (9.6)

Balance of Trade in India’s favor

6465 7069 7179 6586 3720

P a g e | 3

US Global Trade and Trade with India

(US $ Million)

2012 2013 2014 2015

2016

Year to date*

Export Import Export Import Export Import Export Import Export Import

US Global

trade 2,202,232 2,728,280 2,279,972 2,729,074 2,364,429 2,837,630 2,253,432 2,736,889 - -

Merchandise 1,545,821 2,276,267 1,578,517 2,267,987 1,621,172 2,356,366 1,502,572 2,248,232 1,203,565 1,813,844

Services 656,411 452,013 701,455 461,087 743,257 481,264 750,860 488,657 559,100 374,771

US trade

with India 34,414 59,286 35,128 62,197 36,681 67,714 39,559 69,485 - -

Merchandise 22,106 40,513 21,810 41,810 21,501 45,355 21,452 44,792 17,525 39,015

Services 12,308 18,773 13,318 20,387 15,180 22,359 18,107 24,693 16,016 19,736

India’s share

in US trade

(%)

1.56 2.17 1.54 2.28 1.55 2.39 1.76 2.54 - -

Merchandise

1.43 1.78 1.38 1.84 1.33 1.92 1.43 1.99 1.46 2.15

Services

1.87 4.15 1.90 4.42 2.04 4.65 2.41 5.05 2.86 5.27


2016 Year to date*: Data for merchandise trade relates to the period January to October 2016

Data for trade in services relates to the period January to September 2016

P a g e | 4

TRENDS IN MAJOR ITEMS OF BILATERAL TRADE

Top ten items of India’s Exports to US

8071

4950

2514

1993

1812 20

46

1724

1391

1013

1075

9430

6278

2044

1950

1807

1740

1682

1375

1150

1087

0

1000

2000

3000

4000

5000

6000

7000

8000

9000

10000

Jan. -Oct. 2015

Jan. -Oct. 2016

(16.8)

Source: US Department of Commerce, US Census Bureau% Change over previous period, mentioned in parenthesis

(US

$ M

illio

ns)

(26.8)

(-18.7)(-2.2) (0.3) (-15)

(-2.4) (-1.2)(13.5) (1.1)

January – October 2016

HS Code

Description US $ Million % Share % Change

2016/2015

_Total All Commodity Chapters 39015 100 1.33

71 Nat Etc Pearls, Prec Etc Stones, Pr Met Etc; Coin 9430 24.17 16.83

30 Pharmaceutical Products 6278 16.09 26.82

27 Mineral Fuel, Oil Etc.; Bitumin Subst; Mineral Wax 2044 5.24 -18.69

63 Textile Art Nesoi; Needlecraft Sets; Worn Text Art 1950 5 -2.18

62 Apparel Articles And Accessories, Not Knit Etc. 1807 4.63 -0.27

84 Nuclear Reactors, Boilers, Machinery Etc.; Parts 1740 4.46 -14.99

29 Organic Chemicals 1682 4.31 -2.44

61 Apparel Articles And Accessories, Knit Or Crochet 1375 3.52 -1.18

03 Fish, Crustaceans & Aquatic Invertebrates 1150 2.95 13.5

85 Electric Machinery Etc; Sound Equip; Tv Equip; Pts 1087 2.79 1.11


P a g e | 5

Top ten items of U.S. Exports to India

5720

1814

1079

1143

986

1154

648

559

603

506

5445

1632

1084

1008

938

783

649

597

532

486

0

1000

2000

3000

4000

5000

6000

7000

Jan. -Oct. 2015

Jan. -Oct. 2016

(-4.8)

Source: US Department of Commerce, US Census Bureau% Change over previous period, mentioned in parenthesis

(US

$ M

illio

ns)

(-10)

(-0.5) (-11.8) (-4.8) (-32.25)(0.2) (6.8)

(-11.8)(-3.8)


HS Code


2016/2015

_Total All Commodity Chapters 17525 100 -4.39

71 Nat Etc Pearls, Prec Etc Stones, Pr Met Etc; Coin 5445 31.07 -4.8

84 Nuclear Reactors, Boilers, Machinery Etc.; Parts 1632 9.31 -10

90 Optic, Photo Etc, Medic Or Surgical Instrments Etc 1084 6.19 0.48

85 Electric Machinery Etc; Sound Equip; Tv Equip; Pts 1008 5.75 -11.75

27 Mineral Fuel, Oil Etc.; Bitumin Subst; Mineral Wax 938 5.36 -4.79

88 Aircraft, Spacecraft, And Parts Thereof 783 4.47 -32.15

29 Organic Chemicals 649 3.7 0.15

39 Plastics And Articles Thereof 597 3.41 6.84

08 Edible Fruit & Nuts; Citrus Fruit Or Melon Peel 532 3.04 -11.8

38 Miscellaneous Chemical Products 486 2.78 -3.84


P a g e | 6

TRENDS IN US GLOBAL TRADE

Top Ten Items of U.S. Global Imports


HS Code


2016/ 2015


85

Electric Machinery Etc; Sound Equip; Tv Equip;

Pts 271106 14.95 -0.13

84

Nuclear Reactors, Boilers, Machinery Etc.;

Parts 256507 14.14 -5.12

87

Vehicles, Except Railway Or Tramway, And

Parts Etc 231427 12.76 0.35

27

Mineral Fuel, Oil Etc.; Bitumin Subst; Mineral

Wax 125010 6.89 -24.54


90

Optic, Photo Etc, Medic Or Surgical Instrments

Etc 65902 3.63 2.43

71

Nat Etc Pearls, Prec Etc Stones, Pr Met Etc;

Coin 56232 3.1 12.14

94

Furniture; Bedding Etc; Lamps Nesoi Etc;

Prefab Bd 49042 2.7 3.32


39 Plastics and articles thereof (data till Sept ’16) 36043 2.22 -1.58


P a g e | 7

Top Ten Items of U.S. Global Exports


HS Code


2016/ 2015


84 Nuclear Reactors, Boilers, Machinery Etc.; Parts 158946 13.21 -8.49

85

Electric Machinery Etc; Sound Equip; Tv Equip;

Pts 138261 11.49 -2.95

88 Aircraft, Spacecraft, And Parts Thereof 111254 9.24 2.58

87

Vehicles, Except Railway Or Tramway, And

Parts Etc 104507 8.68 -2.21

27

Mineral Fuel, Oil Etc.; Bitumin Subst; Mineral

Wax 76119 6.32 -14.27

90

Optic, Photo Etc, Medic Or Surgical Instrments

Etc 68060 5.65 -2.39

39 Plastics And Articles Thereof 49091 4.08 -3.76

71 Nat Etc Pearls, Prec Etc Stones, Pr Met Etc; Coin 47257 3.93 -6.11




P a g e | 8

Top 5 competitors of India’s top 5 exports to USA

Serial Number

Commodity Competitors by rank

1 Commodity: 71, Natural Or Cultured Pearls, Precious Or Semiprecious Stones, Precious Metals; Precious Metal Clad Metals, Articles Thereof; Imitation Jewelry; Coin

Israel

Canada

Switzerland

Mexico

Belgium

2 Commodity: 30, Pharmaceutical Products Ireland

Switzerland

Germany

United Kingdom

Canada

3 Commodity: 27, Mineral Fuels, Mineral Oils And Products Of Their

Distillation; Bituminous Substances; Mineral Waxes

Canada

Saudi Arabia

Venezuela

Mexico

Colombia

4 Commodity: 63, Made-Up Textile Articles Nesoi; Needlecraft Sets;

Worn Clothing And Worn Textile Articles; Rags

China

Pakistan

Mexico

Turkey

Bangladesh

5 Commodity: 62, Articles Of Apparel And Clothing Accessories, Not

Knitted Or Crocheted

China

Vietnam

Bangladesh

Indonesia

Mexico


P a g e | 9

Top 5 competitors of India’s top 5 imports from USA

Serial Number

Commodity Competitors by rank

1 Commodity: 71, Natural Or Cultured Pearls, Precious Or

Semiprecious Stones, Precious Metals; Precious Metal Clad Metals,

Articles Thereof; Imitation Jewelry; Coin

Switzerland

Hong Kong

United Kingdom

Israel

Canada

2

Commodity: 84, Nuclear Reactors, Boilers, Machinery And

Mechanical Appliances; Parts Thereof

Mexico

Canada

China

Japan

Germany

3 Commodity: 90, Optical, Photographic, Cinematographic,

Measuring, Checking, Precision, Medical Or Surgical Instruments

And Apparatus; Parts And Accessories Thereof

China

Canada

Mexico

Japan

Germany

4 Commodity: 85, Electrical Machinery And Equipment And Parts

Thereof; Sound Recorders And Reproducers, Television Recorders

And Reproducers, Parts And Accessories

Mexico

Canada

China

Hong Kong

Malaysia

5 Commodity: 27, Mineral Fuels, Mineral Oils And Products Of Their

Distillation; Bituminous Substances; Mineral Waxes

Mexico

Canada

Netherlands

Brazil

Colombia


P a g e | 10

WHAT'S MAKING NEWS Policy Changes; Bilateral Talks, Agreements; Notices etc. that can have an impact on India

(Sources: taken from various media sources) U.S. GOVERNMENT

President-elect Donald Trump and his trade agenda

In a speech on 9th November soon after his election victory, President-elect Donald

Trump said, “We have a great economic plan. We will double our growth and have the

strongest economy anywhere in the world. While we will always put America's interest

first, we will deal fairly with everyone.......all people and all other nations. We will seek

common ground, not hostility; partnership, not conflict”.

He added, “Every single American will have the opportunity to realize his or her

fullest potential. We are going to fix our inner cities and rebuild our highways, bridges,

tunnels, airports, schools, hospitals. We are going to rebuild our infrastructure, which will

become, second to none. We will put millions of our people to work as we rebuild it”.

Various U.S. media sources highlighted President-elect’s likely trade plan pieced

together from his campaign speeches and press releases, including:

Withdrawing from the TPP, which has not yet been ratified;

Appointing tough and smart trade negotiators to fight on behalf of American

workers;

Directing the Secretary of Commerce to identify abuses and violations of trade

agreements by foreign countries, and ordering appropriate agencies to end such

abuses;

Renegotiating NAFTA terms to get a better deal for US workers;

Instructing the Treasury Secretary to label China as a currency manipulator;

Instructing the US Trade Representative to bring trade cases against China, both in

the US and at the WTO;

Imposing 45% tariffs against Chinese products and 35% tariffs against Mexican

products.

President-elect Donald Trump outlines policy plan for first 100 days

President-elect Trump on 21st November released a video online outlining some of his

policy plans for the first 100 days. He emphasized that his agenda will be based on a simple

core principle: putting America First. He said, “whether it’s producing steel, building cars,

P a g e | 11

or curing disease, I want the next generation of production and innovation to happen right

here, in our great homeland: America – creating wealth and jobs for American workers”.

President-elect Trump, specifically, talked about developing a list of executive actions on

day one to restore laws and bring back jobs. To quote President-elect:

“On trade, I am going to issue our notification of intent to withdraw from the Trans-

Pacific Partnership, a potential disaster for our country. Instead, we will negotiate fair,

bilateral trade deals that bring jobs and industry back onto American shores.

On immigration, I will direct the Department of Labor to investigate all abuses of visa

programs that undercut the American worker.

On energy, I will cancel job-killing restrictions on the production of American energy –

including shale energy and clean coal – creating many millions of high-paying jobs. That’s

what we want, that’s what we’ve been waiting for.

On regulation, I will formulate a rule which says that for every one new regulation,

two old regulations must be eliminated, it’s so important.

On national security, I will ask the Department of Defense and the Chairman of the

Joint Chiefs of Staff to develop a comprehensive plan to protect America’s vital

infrastructure from cyber-attacks, and all other form of attacks.

On ethics reform, as part of our plan to Drain the Swamp, we will impose a five-year

ban on executive officials becoming lobbyists after they leave the Administration – and a

lifetime ban on executive officials lobbying on behalf of a foreign government.”

President-elect Trump nominates Wilbur Ross as Secretary of Commerce

President-elect Donald Trump nominated billionaire investor Wilbur Ross as

Secretary of Commerce and Todd Ricketts, owner of the Chicago Cubs baseball team, as the

Deputy Commerce Secretary. Ross is a private sector equity investor with experience in

restructuring struggling companies, including large steel, coal and textile mills. He was a

senior economic adviser to Mr. Trump during his campaign. President-elect called Ross “a

champion of American manufacturing” who “knows how to help companies succeed”.

In an interview with Fox News post his nomination as Commerce Secretary, Ross

laid out the following trade policy priorities-

Withdrawal from the Trans-Pacific Partnership;

P a g e | 12

Negotiation of bilateral free trade agreements;

o Mr. Ross said expressly stated that the US would shun multilateral trade

agreements. He cited the TPP as an example, explaining that its rules-of-

origin provision would allow third countries like China to benefit as a free

rider.

Review of existing US trade agreements, starting with the NAFTA.

President-elect Trump also announced his nominees for the following cabinet

positions:

Secretary of the Treasury- Mr. Steven Mnuchin, the founder of RatPac-Dune

Entertainment;

Secretary of Transportation- Ms. Elaine Chao, former Labor Secretary of the US;

Secretary of Health and Human Services- Representative Tom Price, the current

chairman of the House Budget Committee.

President-elect Trump touts deal to keep Carrier in US

Vide twitter messages, President-elect Donald Trump and the Carrier Corporation

conveyed that they had reached an agreement to keep Carrier’s Indiana plant in the US.

Carrier, which had previously planned to move its Indianapolis operations to Mexico,

tweeted that due to the agreement, it would keep “close to 1,000 job” in Indianapolis.

President-elect tweeted that “we will keep our companies and jobs in the US.”

In an interview with CNBC, Commerce Secretary nominee, Wilbur Ross, touted the

announcement of the deal as a “trade victory before we’ve even come into office.” He added

that the Trump administration would fix the detrimental trade treaties which incentivize

US corporations to shift abroad.

China will cause global semiconductor chip overcapacity: Pritzker

While speaking at a program sponsored by the Center for Strategic and

International Studies, Secretary of Commerce Penny Pritzker accused Beijing of attempting

to take control of the world semiconductor industry through unfair trade practices and

massive government subsidies. In what Washington Trade Daily reported as a possible new

trade complaint against China, Secretary Pritzker said that the Administration is

P a g e | 13

determined to make sure Chinese subsidies do not lead to global overcapacity of

semiconductors – as has already happened in the steel and aluminum industries.

While stating that the US “cannot afford to cede its leadership” on semiconductor

technology, Pritzker charged that China is trying to “rig the game” in favor of its producers.

She also charged that Chinese companies have been trying to acquire companies and

technologies based on their government’s interests – not commercial objectives. “This

unprecedented state-driven interference would distort the market and undermine the

innovation ecosystem,” she said.

US and China signal lack of progress at JCCT

On the sidelines of the US-China Joint Commission on Commerce and Trade (JCCT)

meeting, USTR Michael Froman and China's Vice Premier for State Council Wang Yang

signaled that little progress had been made on expediting China's biotech approval system.

"The United States has long sought that China have a transparent, timely and science-based

regulatory system for the review and approval of products derived from agricultural

biotechnology," Froman told reporters. "We've had many discussions on this topic, but we

still have unnecessary trade disruptions because of the asynchronous approval process," he

added. Wang responded by stating that genetically modified organisms are a relatively new

development and that China is acting "prudently" rather than in a "protectionist" manner.

US trade deficit at lowest level since February 2015

According to data released by the US Department of Commerce, the US trade deficit

fell 9.9 percent in September from August’s level to stand at $36.44 billion. Washington

Post explained the surge in a report which said that the demand for US-made airplanes and

other exports increased in September, while imports slipped. The report also said that

exports increased 0.6 percent to $189.2 billion, which is “the highest level in more than a

year,” while imports “fell 1.3 percent to $226.6 billion.”

Further, the data showed that the deficit with China “contracted to $32.5 billion in

September and is running 6.3% below last year’s level,” and that the deficit with the

European Union fell by 26.8% to $10.2 billion.

P a g e | 14

US DOC makes affirmative preliminary determination in an investigation on Carbon

Steel Flanges from India

The US Department of Commerce (DOC) made an affirmative preliminary

determination in its countervailing duty investigation of ‘Finished Carbon Steel Flanges

from India.’ The US DOC preliminarily determined that producers/exporters of finished

carbon steel flanges from India received countervailable subsidies from the Government of

India. The subsidy rate was determined to be 2.76% and 3.66% for mandatory respondents

‘Norma Ltd.’, and ‘RN Gupta Ltd’ respectively. All other producers/exporters in India were

assigned a subsidy rate of 3.21%. The US DOC is scheduled to announce its final

determination by April 11, 2017.

US DOC imposes AD/CVD orders against welded stainless pressure pipes from India

Vide an unpublished federal register notice, the US Department of Commerce (US

DOC) issued antidumping (AD) and countervailing duty (CVD) orders against welded

stainless pressure pipes from India (product). the USDOC imposed CVDs on the product

after determining that the Indian exporters under review, Steamline Industries Limited and

Sunrise Group, received countervailable subsidies at the rate of 3.13 and 6.22%

respectively. All other exporters in India have been assigned a subsidy rate of 4.65%.

Additionally, The US DOC also issued AD orders against the product from India, assigning a

dumping margin of 12.66% for all exporters of the product from India.

Number of Indians studying in US increased by 25%

According to the 2016 ‘Open Doors Report on International Educational

Exchange,’ released by the Institute of International Education (IEE) and the US State

Department’s Bureau of Educational and Cultural Affairs, the number of international

students attending US colleges and universities surpassed one million for the first time

during the 2015-16 academic year. With a 25 percent increase, students from India,

numbering 165,918, formed the second largest foreign student population in the US. The

report also revealed that more than three quarters of all Indian students in the US study

science, technology, engineering or math (STEM) courses. In light of the report’s launch, IIE

P a g e | 15

President Allan Goodman said that “the Institute of International Education, believes

American colleges and universities offer a premiere education and valuable training to

students from around the globe and that students from other nations also teach us a lot

about the world we share. The more we can open doors to other cultures for our students,

the better off our country and our world will be.”

DHS issues final job flexibility rule for immigrant workers

The US Department of Homeland Security (DHS) issued a final rule titled

‘Improvements Affecting High-Skilled Nonimmigrant Workers.’ The rule – aimed at

boosting job flexibility for certain skilled immigrant workers – has been issued with just

enough time for it to come into effect before President Barack Obama remits office.

The salient features of the rule are-

It allows employers to submit additional H-1B portability petitions for foreign

workers;

It provides high-skilled workers certain grace periods — two 10-day grace periods

as well as a 60-day grace period — allowing them to seek new jobs;

It contains a provision for temporary work authorization for certain foreign

nationals who possess approved employment-based visa petitions but are stuck in

visa backlogs and dealing with “compelling circumstances.”

This rule implements the provisions of the American Competitiveness in the Twenty-

first Century Act of 2000, a legislation that allows for longer H-1B status extensions.

U.S. CONGRESS

Paul Ryan re-nominated by Republicans as Speaker

On 15 November, House Speaker Paul Ryan was unanimously re-nominated by the

Republican party to continue to serve as speaker in the 115th Congress. NPR explained that

while Ryan must still win a majority by the full House when the new Congress convenes on

3 January 2017, he is expected to easily win that vote.

http://www.law360.com/agencies/u-s-department-of-homeland-security

P a g e | 16

Senators join efforts to block Chinese acquisition of US aluminum producer

In a Nov. 2 letter to Treasury Secretary Jack Lew, 12 senators – citing trade and

national security concerns – urged the Committee on Foreign Investment in the United

States (CFIUS) to reject a proposal by a Chinese company, Zhongwang USA, to purchase US

aluminum producer Aleris. The letter, which was initiated by Senator Ron Wyden (D-OR),

stated that “Zhongwang's purchase of Aleris would directly undermine our national

security, including by jeopardizing the US manufacturing base for sensitive technologies in

an industry already devastated by the effects of China's market distorting policies, and

creating serious risk that sensitive technologies and knowhow will be transferred to China,

further imperiling US defense interests.” “It is increasingly critical that CFIUS exercise

particular caution when a foreign investment transaction creates potential for military

knowhow and sensitive technology to be transferred to China's government,” the letter

added.

Vide a press release, the United Steelworkers union came out in support of the

letter, stating that “We laud Sen. Wyden for spearheading this effort to convince the Obama

Administration to reject the proposed bid by a Chinese-controlled company to buy Aleris

Corporation.”

Renegotiate TPP, don't withdraw: Brady's advice for President-elect Trump

Speaking at an event hosted by Politico and FedEx, House Ways & Means

Committee Chairman Kevin Brady (R-TX) – while stressing that the Asia-Pacific market is

“crucial” to the US economy – urged president-elect Donald Trump not to withdraw from

the TPP but to renegotiate those parts of it that President-elect wants to see addressed.

“That region will hold half the middle-class customers on the planet by the end of the

decade. We wanna be there. And if we withdraw or abandon that field completely, you

know we lose and China wins in a major way,” Brady said. He also said that he was

“hopeful” that lawmakers would be permitted to highlight the benefits of trade agreements

to President-elect Trump, stating that “I hope that he allows us to make the case that to

http://www.usw.org/news/CFIUS-Aluminum-11-2-2016.pdf

P a g e | 17

grow our economy it's just not enough to buy American; we have to sell American all

throughout the world.”

BUSINESS GROUPS

USIBC makes recommendations to President-elect on Strengthening India-U.S. Strategic

Partnership

In a letter to President-elect Donald Trump congratulating him on his election victory,

the president of the US India Business Council (USIBC), Mukhesh Aghi encouraged the

President-elect to prioritize the US-India relationship in his policies. In this regard, Aghi

recommended a set of actions – based on suggestions received from over 350 USIBC member

companies – that the Trump administration could take, in its first months, to deepen and expand

commerce between the United States and India, they were-

1. State Visit- The USIBC recommended that the President-elect invite Prime Minister

Modi for a state visit within the first year of the Presidential term. This, the council said,

would send a clear signal about the importance of the bilateral relationship;

2. Continue Government to Government Dialogues- To continue, and strengthen, the

government-to-government dialogues between the US and India. These dialogues, the

council asserted, generated policies to improve the ease of doing business, level the

playing field through fair competition, expand access to finance, promote strong labor

law reforms and infrastructure investment, challenge counterproductive trade practices

like price controls (a significant issue for the life sciences industry) and foreign direct

investment (FDI) restrictions in the agriculture (including tobacco) and insurance sectors,

and synchronize regulatory standards with global norms;

3. Liberalize Trade- To negotiate a bilateral investment treaty between the US and India;

4. Support India’s admission into the APEC- The USIBC recommended that the US push

for India’s admission into the Asia Pacific Economic Cooperation (APEC) Forum;

5. U.S.-India Defense Trade- To order a comprehensive review of the policies and

procedures that weaken US competitiveness in the Indian defense and aerospace market.

Particularly, the council recommended that the US review its export control and licensing

processes which put American companies at a competitive disadvantage compared to

foreign competitors like the Russians;

P a g e | 18

6. Innovation- To continue engaging the Government of India to enhance intellectual

property protections emphasizing the benefits of providing a framework that is

transparent, predictable, and one that adheres to international norms and standards;

7. Totalization and Mobility- To work to eliminate outdated and unfair taxes on Indian

workers by concluding an executive agreement with India on social security totalization.

The Council urged President-elect to work with Congress to exempt India from the

“general applicability” requirement of Section 433 of title 42 of the Social Security Act.

US – India Trade Policy Forum offers a hopeful commitment on copyright protection

In a statement on their website, the Motion Picture Association of America (MPAA)

lauded the recently concluded Trade Policy Forum (TPF) meetings between India and the

US. In particular, they welcomed the continued effort between the Indian and US

governments to promote copyright protection and enforcement. The statement, which calls

for strong legal and enforcement frameworks against copyright infringement – including

legislation to criminalize the unauthorized camcording of films in theaters – and rampant

online piracy, states that these protections are important to both Hollywood and

Bollywood film industries.

US commodity groups call for addressing EU biotech issues in TTIP talks

In comments submitted to the office of the USTR, The US Grains Council and USA

Rice called on US negotiators to address within the TTIP the EU's “asynchronous approval

process” of biotechnology traits as well as the EU's “low-level presence” policy. The groups,

which are calling for the TTIP to make EU’s authorization process more efficient, said that

“it is imperative that these regulatory challenges are addressed as an integral part of the

TTIP negotiations.”

Inside US Trade explained that commodity groups and the US government have long

faulted the EU's biotech authorization program because it is not “science-based.” For a

biotech trait to be approved, the European Food Safety Authority must first deem it safe.

Then member states can approve the trait by reaching a qualified majority -- or 55 percent

of member states representing at least 65 percent of the EU population -- in favor. Member

states are typically unable to reach a qualified majority in favor or against the approval of

P a g e | 19

traits, which by EU law then passes the decision to the European Commission. The

Commission has been criticized for the growing backlog of traits awaiting its decision.

REPORTS & PUBLICATIONS

India may suffer in immigration and investment sectors in Trump Presidency: CNBC

In an article regarding the Trump Presidency, CNBC reported that the Trump

Administration would likely harm India in the immigration and investment sectors. The

report said that "India's software exports could be impacted if immigration policy turns

more restrictive considering that India remains the biggest user of H1B visas, about 70

percent of issuances.” Based on the Trump campaign’s threat to crackdown on

multinational tax offshoring, the report said that “investment flows to India could be

impacted if multinational corporations choose to repatriate larger shares of their income,

as suggested during the Trump campaign."

Bloomberg explains why America needs India's rockets

According to a Bloomberg article, the US should repeal its 2005 policy prohibiting

US satellite manufacturers from hiring India's space agency to launch their equipment. The

article explains that while private American launch companies – such as SpaceX – are

happy with this arrangement, which was intended to protect them, the policy is actually

impeding the new American satellite industry. According to the article – which comes in

light of a recent USTR decision to review this policy – the Indian Space Research

Organization’s Polar Satellite Launch Vehicle – which was designed to launch small

satellites – occupies a very lucrative and important niche within the satellite industry. It

states that with the boom in the micro-satellite industry, which has seen over $2.5 billion

investment over the past 10 years, there is a need to have reliable and cost-effective launch

services.

The article explains that currently, no other US company offers a satellite launch

vehicle for small satellite launches, and that the European government consortium offers it

for a hefty fee. In conclusion, and in light of the fact that American rocket companies have

P a g e | 20

failed come out with a competitive product despite 10 years of exclusivity, the article

argues that the USTR ought to overturn the prohibition as it hurts American satellite

manufacturers and also sends the wrong message to India.

Trump administration spells the end for TPP and TTIP: Think tanks

Inside US Trade reported that President-elect Donald Trump would most likely

withdraw from ongoing trade negotiations, and take steps to stop the TPP from entering

into force. The report said that he would likely make sure the US is not a party to the TPP,

regardless of whether Congress passes it in the upcoming lame-duck session. Scott

Kennedy, director at the Center for Strategic and International Studies, said that a

Republican Congress would likely forgo passing the TPP in the lame-duck because GOP

lawmakers know that President-elect Trump would immediately unravel the deal upon

taking office. Kennedy explained that “for TPP to enter into force, the US must ratify the

deal. As president, Trump would have to certify that TPP partners are living up to their

commitments to complete the US ratification process. Absent US ratification, other TPP

countries could opt to negotiate a plurilateral deal on the basis of TPP.”

The report also said that President-elect Trump's inauguration could also spell the

end of the TTIP negotiations between the US and EU. It explained that, based on Mr.

Trump’s anti-trade rhetoric on the campaign trail, he would not be a "promoter" of TTIP.

Anthony Siberfeld, the director of transatlantic relations at the Bertelsmann Foundation,

explained that “an enthusiastic Obama administration and European Commission were

unable to overcome politically sensitive issues to close the deal. Accordingly, a US

administration that is not keen to conclude the negotiations would make it very difficult to

close the deal.”

Claude Barfield a trade expert at the American Enterprise Institute, agreed with this

assessment, stating that even if the Obama administration secures a successful vote on TPP

this year, President-elect could tear up the agreement once in office. “It's hard to know, but

I can't see the Republican leadership going forward given President-elect Trump’s adamant

stance against the TPP,” Barfield said. Barfield also noted that some Republican lawmakers

P a g e | 21

may be reluctant to support TPP for fear of the backlash they could face from Trump

supporters in the 2018 midterm elections.

President-elect Donald Trump’s infrastructure plans win backing from OECD

According to a Financial Times report, President-elect Donald Trump’s economic

plans have received strong backing from the Organisation for Economic Co-operation and

Development (OECD), with the international organisation predicting the president-elect’s

infrastructure plans would increase US growth, combat inequality and energise

discouraged workers. The OECD ‘Economic Outlook Forecast’ for 2017 showed that the US

is expected to be the best performing large advanced economy in 2017, growing 2.3 per

cent while the eurozone and Japan grow at 1.6 and 1 per cent respectively. Catherine Mann,

chief economist of the OECD, explained that this forecast was a result of the organisation’s

positive view of US tax and public spending policy after the election. She added that the

Trump fiscal effect was an important part of the OECD’s projections.

Despite this Praise, the OECD forecast warned that the predicted gains would

disappear if trade barriers were to be raised, something Mr. Trump has threatened to do on

numerous occasions. “Trade protectionism shelters some jobs, but worsens prospects and

lowers wellbeing for many others,” Mann said.

OTHER INTERNATIONAL DEVELOPMENTS

Canada willing to renegotiate NAFTA

In an interview with BBC, Canadian Finance Minister Bill Morneau said that he was

ready to renegotiate the NAFTA. Mr. Morneau, who explained that Canada was willing to

improve the NAFTA, said that the strength of the US-Canada relationship will provide a

stable framework and ensure the success of such negotiations.

Mexican finance minister says any NAFTA changes must benefit all parties

Mexican Finance Minister José Antonio Meade told the Financial Times that while

Mexico was willing to talk to the Trump administration about modifying the NAFTA, a

https://www.ft.com/donald-trumphttps://www.ft.com/content/84ca9d3c-b327-11e6-9c37-5787335499a0

P a g e | 22

renegotiation would have to benefit all parties to the deal. Meade, who explained that

NAFTA was “creating value on both sides of the border,” said that US-Mexico trade

“involved complex supply chains that could not be unraveled with ease and was not a win-

lose relationship.”

Diet’s lower house approves TPP deal, Abe to appeal to others

On 11 November, the lower house of the Japanese Parliament approved the TPP

deal. The TPP bill passed with the support of the ruling coalition despite the fact that the

opposition boycotted the vote. The bill is now pending approval in the upper house, where

it is expected to pass without any hindrance.

Japanese Prime Minister Shinzo Abe told Japanese news media that he would urge

US President-elect Donald Trump “and others who have insisted on leaving the TPP” to

ratify the deal. While explaining that the Diet’s approval of the TPP would contribute to

blocking the spread of protectionism in the world, Abe said that “I will seize every

opportunity to urge the United States and other countries to complete domestic procedures

promptly.”

Brazil requests WTO consultations with US over CVDs on hot, cold-rolled steel

On 11 November, Brazil formally requested consultations with the US at the World

Trade Organization (WTO), claiming that the US – in its handling of two countervailing duty

(CVD) cases on hot and cold-rolled steel from Brazil – violated multiple articles of the WTO

Agreement on Subsidies and Countervailing Measures (ASCM). Brazil's consultation

request is based on the following claims-

The US CVD investigations were incorrectly carried out from a procedural

perspective:

o According to Brazil, the US initiated the investigations using inaccurate and

insufficient data and evidence. Furthermore the US improperly relied on

adverse facts available in making its final CVD determinations;

http://the-japan-news.com/news/article/0003343033http://the-japan-news.com/news/article/0003343033

P a g e | 23

The determination of injury made by the US was not based on positive evidence:

o Brazil claims that the determination did not involve an objective examination

of the facts of the case. Additionally, it claims that the US determination of

Brazil's “domestic industry” did not refer to the entirety of Brazil's domestic

steel producers, pointing out that data relating to only seven of twelve

domestic producers were used in the determinations;

That the US incorrectly defined certain government measures – such as tax

exemptions and government loan programs – as countervailable subsidies; and

That the US incorrectly calculated the CVD margins as it relates to the tax and loan

measures subject to the investigations.

WTO Panel finds that Boeing received illegal subsidies

A WTO dispute settlement panel found that one of the seven tax incentives given to

Boeing by the US state of Washington, constituted a prohibited subsidy. The European

Union, which instituted the proceedings, alleged that Boeing had received billions of dollars

in prohibited subsidies by virtue of Washington state’s reduced business tax rate used to

ensure that wings for the Boeing 777X aircraft were sourced domestically. The Panel said

that this tax rate constituted a “subsidy de facto contingent upon the use of domestic over

imported goods,” and recommended that the US withdraw the subsidy within 90 days.

Regardless of this finding, the Office of the US Trade Representative (USTR) and the

Boeing corporation characterized the panel’s finding as a victory. The WTO rejected six of

the seven tax measures challenged by the EU, along with their main argument in this case,”

USTR spokesman Matt McAlvanah told Inside US Trade. He added that “on the single

fallback argument the WTO accepted, we are currently reviewing the report in consultation

with Washington state officials to decide how to respond.”

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Trade Inquiries

Ninety-eight inquiries were received during the period and relevant details were provided on them to the business houses/individuals seeking information.

Visa Facilitation for Business Travelers

The Commerce Wing of the Embassy o f India

in Washington, DC facilitates, whenever

approached, grant of business visa to

business travelers from the US to India. It also

examines and clears grant of visa to US

Government officials from relevant

Departments in the US Government travelling

on official visits to India. The number of

Business visas issued by EoI, Washington, DC

in November 2016 was 297. During the same

period 7 employment visas were also issued

from this Mission.

____________________________________

© Commerce Wing – Embassy of India –

Washington DC – November 2016

For questions & feedback

Commerce Wing

Embassy of India - Washington, DC

Fax: 202-797-4693

[email protected]

_____________________________

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