AA Edit | India’s Priority Should Be Early Trade Deal With US

The EU has acted in imposing sanctions on the oil refinery in Vadinar in Gujarat, which is part-owned by the Russian energy giant Rosneft while also lowering the oil price cap. That its member countries have been buying the output of diesel and petrol from this refinery does not seem to have counted when it came to penalising Russia for waging war against Ukraine. India’s cries of “double standards” may have been so much straw in the wind.

Trump’s eagerness to bring Russia to the table regarding the Ukraine war that began three years ago is understandable. But his calls for tariffs on Russia may have little meaning as there is so little trade. But it would be in everyone’s interest to see this long-running war end, most of all Russia whose economy too is showing signs of war-weariness.

Dealing with mercurial Donald Trump is a conundrum that is holding the rest of the world in thrall. Second guessing the US President has taken a very serious turn amid a smorgasbord of tariffs but while flattery seemed to score brownie points for a few nations, some were seen beating a retreat after nominating him for the Nobel Peace Prize.

Trade deals to beat deadlines that seem to shift like desert sand in the wind are a priority for many scrambling to make sense of a new order that Trump is trying to create to shape the future of global trade after decades of virtually tariff-free exports into the world’s largest economy with an oversized appetite for the world’s goods.

Amid the wrangling over trade came the news that the US has named The Resistance Front, an arm of the Pakistan-based Lashkar-e-Taiba, that India, with its security focus on sponsored terror, sees as a gigantic positive at a time when the prickly neighbour has used its ‘iron-clad’ friend China to stave off being named in the SCO forum with regard to the Pahalgam terror event.

And yet India will realise that Trump’s calls on various issues affecting the nation are, like the curate’s egg, good in parts. Waiting in the wings is Republican lawmaker Lindsey Graham’s Bill that seeks to impose 500 per cent duties on India for buying Russian oil while Trump himself is considering a secondary tariff of at least 100 per cent on those who continue to source Russian crude. India might find itself on a cleft stick in this regard, but it has smart options that it hopes to use when the time comes.

India is unlikely to be on the list of 150 countries to whom Trump will be dropping tariff letters and yet it must be able to present its case strongly enough in fresh rounds of negotiations on tariffs and market access that are on in the USA now to make a deal that will not see its exports too badly hit. Trump has thrown hints that India might get a trade agreement like the one with Indonesia with a 19 percent tariff on US imports while getting some American products tariff-free access.

Signing an agreement with the US should be of utmost priority even if India should ideally look towards diversifying trade with other countries. Strong ties with the United States serve India’s strategic interest too. A deal with Washington would be a starting point for the future as the tariffs would define how much of a hit Indian export may have to take.