Chennai: India has agreed to take “complementary actions to address non- market policies of third parties” in its framework agreement. Under this, if the US takes action against any other country, including economic sanctions, India will be forced to adopt similar measures.
“The United States and India agree to strengthen economic security alignment to enhance supply chain resilience and innovation through complementary actions to address non- market policies of third parties, as well as cooperation on inbound and outbound investment reviews and export controls,” the statement said.
This provision seeks to align India’s security and economic policies with those of the United States, and therefore requires great caution, finds GTRI.
“Agreeing to such a provision could have far-reaching adverse implications. If the United States were to impose 100 per cent tariffs on imports from countries such as Russia or China on economic security grounds, India will be expected to adopt similar measures. India will also have to restrict transactions in third countries that are sanctioned by the United States. No independent foreign policy for India,” said Ajay Srivastava, founder, GTRI.
Further, India will have to address “discriminatory or burdensome practices and other barriers to digital trade” and this could also take away India’s rights to have an independent digital trade policy.
“India may be required to consult the United States before entering into new digital trade agreements with other countries, to ensure that such agreements do not affect U.S. interests. India may also be constrained from entering into agreements on technical or health standards with other countries if those standards are seen as disadvantaging the United States,” said GTRI
The US had received similar commitments from Malaysia.
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