Why in news?
- India recently confirmed its plan to slap retaliatory duties on some US imports by June, 2018. Click here to know more
- It has now notified to put off the implementation by a month-and-a-half to August, 2018.
What is the significance?
- Diplomacy - Postponing the levy of retaliatory duties would offer space for resolution.
- Discussions are planned with a visiting team from US Trade Representatives' (USTR) Office.
- Ways to bring down trade tension between the two countries would be discussed.
- Imposing retaliatory duties at this time may undermine the purpose of the meeting.
- Trade - US happens to be one of the largest export destinations for India.
- Despite the increase in exports from the US to India in 2017-18, India has a robust bilateral trade surplus.
- So, it is economically rational for India to maintain this and solve the tariff issue amicably.
What is the way forward?
- Clearly, India has only deferred the imposition, not ruled out.
- India now needs to do focus on convincing the US to roll back the additional duties imposed on Indian aluminium and steel.
- India should also not miss out the path of retaliation by other WTO members, including China, the EU and even Turkey.
Source: BusinessLine
