It is inevitable that the India-US trade deal will reflect a structural imbalance, says Brahma Chellaney


The structural imbalance in the India-US trade deal is inevitable, largely due to power differentials and asymmetry in negotiations, argued geostrategist Brahma Chellaney. He argued that leverage is the “currency of diplomacy” and “reciprocity is its guiding principle.”

“Because of power differentials, asymmetry is inherent in international negotiations. The parties are rarely equal in economic or military strength. But unequal power does not predetermine unequal outcomes. Weaker states often secure advantageous terms by leveraging their own strengths,” Chellaney said.

He gave the example of Singapore, a city-state, which managed to get a 10% US tariff by playing to its strengths, including its role as a global center for semiconductor packaging and pharmaceutical manufacturing.

If this deal is contrasted with the one India negotiated with the US, the details would feel skewed, but there is also much to consider. Although India is “the fastest-growing major economy and the largest untapped market for Western exporters,” it had to negotiate the deal when it was subject to 50 percent tariffs. “For six months, he absorbed the draconian duties without any tangible response, effectively negotiating under open pressure, despite the long-standing diplomatic maxim against negotiating under duress,” he said.

The lesson to be learned from Trump’s abrupt reversal of Greenland and the suspension of 10 percent tariffs on its European allies is that “resistance can alter outcomes.” “Against India, however, tough tactics proved more effective as the Indian government decided to negotiate with a gun to its head,” he said.

Chellaney said it is not surprising that the interim agreement reflects a structural imbalance. “India’s obligations are anticipated, quantifiable and controllable, while US commitments are gradual, conditional and, in key respects, reversible,” he said.

The trade deal between India and the US has been heavily criticized by the opposition. They believe that the Indian government was “forced to give in” and give up more than it will receive. The government, as well as Union Commerce and Industry Minister Piyush Goyal, have on the other hand claimed that this is a “win-win” deal.

Congress general secretary Jairam Ramesh, after Bangladesh announced it had finalized a trade deal with the US, said: “This is not a calibrated opening but a coerced opening. India has been forced to concede more than it has been getting. And now our much-touted advantage over Bangladesh in textile exports to the US has disappeared with the US trade details just announced.”

Congress said Wednesday that the deal reflects an “abject failure” of our “political huglomacy” as well as economic diplomacy. Jairam Ramesh said that regardless of the spin given by the “prime minister and his brigade of lies”, the harsh reality is that the US has extracted more from India than it has conceded.





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