Supply chains, green energy top Biden-Modi talks
In a major breakthrough for the India-US trade relationship which has long term implications for carrying forward the work of transforming the India-US strategic partnership, the two strategic partners have agreed to resolve their seventh and last outstanding dispute at the World Trade Organization on Measures Concerning the Importation of Certain Agricultural Products. The final outstanding clash involved poultry, and in particular India’s import restrictions on certain agricultural products from the US over avian influenza concerns.
The announcement on the resolution of the WTO issue which came as the US President Joe Biden met with Prime Minister Narendra Modi on Friday for the G20 Leaders’ Summit, is an step ahead in the US-India trade relationship alongwith India reducing tariffs on certain US products. According to the US Trade Representative Katherine Tai, as part of the agreement, India also agreed to reduce tariffs on frozen turkey, frozen duck, fresh blueberries and cranberries, frozen blueberries and cranberries, dried blueberries and cranberries, and processed blueberries and cranberries.
Tai expects these tariff cuts will expand economic opportunities for US agricultural producers in a critical market and help bring more US products to customers in India. In June 2023, the US and India terminated six outstanding disputes at the WTO and India also agreed to reduce tariffs on certain US products, including chickpeas, lentils, almonds, walnuts, apples, boric acid, and diagnostic reagents. “The leaders lauded the settlement of the seventh and last outstanding World Trade Organisation (WTO) dispute between India and the United States,” as per a joint statement issued by both sides.
Against this backdrop, the Biden-Modi meet on Friday saw both expressing confidence over developing an ambitious “Innovation Handshake” agenda under the India-US Commercial Dialogue, to include two anchor events in the fall (one in India and one in the US), in which the two sides will collaborate to bring together start-ups, private equity and venture capital firms, corporate investment departments, and government officials to forge connections between the two countries’ innovation ecosystems. Taking forward the commercial engagement, India and the United States are advancing the creation of investment platforms to lower the cost of capital and accelerate the deployment of greenfield renewable energy, battery storage and emerging green technology projects in India. Towards this end, India’s National Investment and Infrastructure Fund and the US Development Finance Corporation exchanged letters of intent to each provide up to USD 500 million to anchor a renewable infrastructure investment fund.
The two partners also see an opportunity in technology’s defining role to deepen the strategic partnership amidst the India-US Initiative on Critical and Emerging Technology (iCET) to build open, accessible, secure and resilient technology ecosystems and value chains. India and the US are supporting the building of resilient global semiconductor supply chains, with a multi-year initiative of Microchip Technology, Inc., to invest approximately USD 300 million in expanding its research and development presence in India and Advanced Micro Device’s announcement to invest USD 400 million in India over the next five years to expand research, development, and engineering operations in India. The United States and India also plan to undertake a midterm review of iCET in September 2023 to continue to drive momentum toward the next annual iCET review, co-led by the National Security Advisors of both countries, in early 2024. A bill has also been introduced in the US House of Representatives to remove high-tech export barriers to India and boost unrestricted export of sensitive technologies to the country.
In another area of cooperation in secure and trusted telecommunications, resilient supply chains and global digital inclusion, a Memorandum of Understanding (MoU) has been signed between Bharat 6G Alliance and Next G Alliance, operated by Alliance for Telecommunications Industry Solutions, as a first step towards deepening public-private cooperation between vendors and operators. This is complemented by the setting-up of two joint task forces focused on collaboration in the field of Open RAN and research and development in 5G/6G technologies.
The inaugural meeting of the India-US Renewable Energy Technologies Action Platform [RE-TAP], in August 2023 has set the stage for the two countries to engage in lab-to-lab collaboration, piloting and testing of innovativetechnologies, collaboration on policy and planning to advance renewable energy. The plan also involves enabling technologies, incubation and outreach programmes as well as training and skill development to accelerate the uptake and adoption of new and emerging renewable technologies and energy systems.
Modi and Biden also discussed the importance of decarbonizing the transport sector, wherein there has been progress in expanding electric mobility in India, including joint support for a payment security mechanism financed through both public and private funds. This will accelerate the procurement of 10,000 made-in India electric buses including those for the Indian PM e-Bus Sewa programme that will include the associated charging infrastructure. The two countries are committed to working together to help diversify the global supply chain for e-mobility.
Touching on a programme to reach new frontiers across all sectors of space cooperation, the leaders have welcomed efforts towards establishment of a working Group for commercial space collaboration under the existing India-US Civil Space Joint Working Group. To deepen the partnership in outer space exploration, ISRO and the National Aeronautics and Space Administration (NASA) have commenced discussions on modalities, capacity building, and training for mounting a joint effort to the International Space Station in 2024 and work is on towards finalising a strategic framework for human space flight cooperation by the end of 2023.