New Delhi, July 30 () : India has resisted the US bid to sell its electronic goods duty-free by getting it to be member of the Information technology Agreement (ITA) second version.
The first pact was signed in 1996 and US now wants it to cover flat panel TV, tablets and cellphones. Joe Biden, the US VP did some lobbying but it did not work. China too has backed out of the proposed ITA 2 and US-EU say that this could have opened trade globally to tune of Rs 48 lakh crore.
India feels it should have been part of ITA since it did more harm than good. WTO members numbering 20 are trying to get Asian countries into the new pact. US and EU know that India’s demand for IT products in another 7 years be Rs 24 lakh crore.
Now, efforts are on to reopen the talks in September but India turning up is doubtful. US IT majors lobbied hard to get India sign on the expansion of new products on the no import tax list.
John Kerry, US secretary was to convince External Affairs Minister Khurshid as to how important it was to Indo-US ties and Biden was expected to give it a push. Google, Microsoft and IBM are part of the companies wanting removal of trade barrier.
FM Chidambaran while on his visit to US told that investors would come knocking if the hurdles and selective blocking of entry into some sectors were removed. US investors felt that India trade policy was one that loaded heavily against the foreign investors.
A preferential market access policy which US IT said was hurting their entry was suspended by India – a move promptly welcomed by US biz. This policy suspension means that MNCs need not buy equipments from Indian manufactures. Unlike the situation in 1996 when India unilaterally signed ITA-1, the industry bodies and the opposition parties would not give the chance to commit a mistake again.