India is hopeful that import of oil and gas worth over $3 billion from the US in 2018 will help to bridge the existing trade imbalance between the two countries significantly and boost bilateral ties, a senior government official said.
The country, however, will continue to import oil from Iran and there is no correlation between India’s purchase from its Islamic neighbour and the US, the official added.
New Delhi will also work on building connectivity between Central Asia and Chabahar port in Iran with the Indian entity India Ports Global Ltd (IGPL) taking over operations in part of the port, the official said.
On improvement of ties with China, the official said the neighbouring country had acted positively by unblocking market access for a number of agricultural and pharmaceutical products and New Delhi will follow it up to ensure that it translates into higher exports.
The lowering of trade deficit with the US, two years in a row, will give a positive signal to the country on India’s seriousness about addressing its major grievance.
“It (gas and oil) is a completely new import on India's part from the US and will directly result in bringing down America's trade deficit with us. However, it doesn't mean that we will stop importing from Iran,” the official said.
The US imposed trade sanctions against Iran earlier this year but allowed some countries, including India, to import till the end of April 2019.
The Trump government has been complaining about the trade deficit that the US has with India ever since it came to power and had also asked its Commerce Department to investigate the reasons behind it.
Washington also included India in the list of countries it penalised with higher import duties on steel and aluminium.
India recognises that the waiver from sanctions given by the US to continue purchase of oil from Iran will be reviewed in six months and its response would depend on how the situation pans out. “We will have to see what the US has to say at the end of six months. But the fact remains that our national and economic interest will keep guiding our decisions,” the official said
The trade deficit between India and the US bridged by almost six per cent in 2017 to $22.9 billion, according to the 'Trade Estimate 2018' released by the USTR earlier this year.
Following the exception from the imposition of economic sanctions with respect to the development of Chabahar Port announced by the US early November, the IGPL has taken over operations in the Shaheed Behesti port, which is part of the bigger port, the official said.
“India will now work on building connectivity between most Central Asian countries and the Chabahar Port. The work will start soon,” the official said.
Source: The Hindu Business LinePrevious Next
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