United States President Donald Trump has expressed confidence that Washington and New Delhi will soon reach a trade agreement, while describing Prime Minister Narendra Modi as a “good friend”. 

Speaking to reporters at the White House on Thursday, Trump remarked that for years India had taken advantage of the United States by charging tremendous tariffs while paying nothing in return. 

He added that the situation had now reversed, with the US making significant gains in trade with India. Trump emphasised that despite past imbalances, a deal would be reached because of his personal rapport with Modi, highlighting their good relationship and mutual understanding.

On Tuesday, the United States announced a fresh set of additional tariffs of 10 per cent and an additional duty of 12.5 per cent on key global economies. The move followed investigations which claimed that goods imported from 60 countries were produced using forced labour.

The Office of the United States Trade Representative (USTR) listed 54 economies, including India, which it said had failed to impose and effectively enforce prohibitions on the importation of goods produced with forced labour.

The list also included Australia, China, Israel, Japan, Qatar, Russia, Saudi Arabia, Singapore, South Korea, Sri Lanka, Switzerland, Taiwan, Thailand, Turkiye, the UAE and the United Kingdom.

According to the USTR, economies that already have some form of forced labour import prohibition, or those that have committed to implementing such measures through trade agreements, could face an additional tariff of 10 per cent.

Other economies may face a 12.5 per cent additional duty. The proposed action also includes a textile mechanism that would allow a certain volume of apparel and textile imports from some economies to enter the US at a reduced Section 301 tariff rate.

The USTR explained that the action comes under Section 301 of the Trade Act of 1974, which permits measures to be taken against economies whose acts, policies and practices are deemed unreasonable and burdensome to US commerce.

The investigations concluded that the failure to prohibit goods produced with forced labour warranted additional duties on all products from the listed economies. The USTR also flagged six economies, including the European Union, Pakistan and Canada, for failing to effectively enforce prohibitions on the importation of goods produced with forced labour.

Trump’s remarks about Modi and the prospect of a trade deal come at a crucial moment, as Indian negotiators are engaged in talks with the visiting US team to finalise details of the bilateral trade agreement

 These discussions are focused on securing preferential market access, addressing non-tariff measures, customs and trade facilitation, investment promotion and aligning economic security.

The imposition of fresh tariffs under Section 301 adds complexity to the negotiations, but Trump’s personal endorsement of PM Modi and his optimism about a forthcoming deal suggest that political goodwill may help to overcome trade frictions.

ANI