India's Strategic Approach to US Trade Agreement

India is negotiating the proposed India-US trade agreement on its own terms, with a strong focus on national interests, according to S Mahendra Dev, chairman of the economic advisory council to the Prime Minister (EAC-PM). This approach aims to benefit India through lower tariffs and increased exports once Free Trade Agreements (FTAs) are finalized.

Key Stances in Negotiations

India has taken a firm stand against the US demand for duty concessions on agricultural and dairy products, a sector where India has not conceded in any FTA. Additionally, India seeks the removal of additional tariffs on its exports and the easing of high US tariffs on steel, aluminium, and automobiles.

Economic Policies and Inflation Targeting

Dev emphasized the importance of maintaining India's current inflation target, highlighting the success of the flexible inflation targeting framework since 2016. He warned against the risks of a higher fiscal deficit, advocating for continued Fiscal Responsibility and Budget Management (FRBM) targets to ensure sustainable growth.

PLI Scheme: A Catalyst for Growth

The Production Linked Incentive (PLI) scheme is driving growth beyond targeted sectors, attracting FDI, and enhancing exports. The government's focus on increasing domestic value addition and reducing import dependence under the PLI scheme is making Indian manufacturing globally competitive.

Electronics Sector: A Success Story

India's electronics sector has seen a remarkable transformation, with the country now ranking among the top assemblers and exporters of mobile phones. The sector has witnessed a significant rise in FDI inflows, marking a shift from import dependency to export-oriented growth.