India seems to be undergoing the same difficulties that China is currently having with the United States. As a matter of fact, the second biggest Asian economy will stop having preferential trade deals with Washington.
Last week, U.S President Donald Trump met with Indian Prime Minister, Narendra Modi, who was keen to tighten trade relations with the American leader.
While diplomatic tensions between India and Pakistan have drastically increased for the past weeks, Modi reminded Trump how crucial the good relation between the two countries was, beyond trade agreements.
However, it seems that tensions between the two giants might have taken a new turn, as the American administration asked the Indian government to stop buying oil from Venezuela.
A disruption hindering the U.S economy
According to Donald Trump, India has been hurting the American economy in the battery industry. On March 5th, he announced his wish to terminate a preferential trade agreement between the two giants.
This treatment was allowing India to export duty-free more than $5.6 billion worth of products. The American President justified his decision by high tariffs requested by India. Last but not least, the U.S. Trade Representative’s Office condemned India of exporting “a wide array of trade barriers that create serious negative effects on United States commerce”.
Trump to drop preferential trade status allowing for tariff-free goods access for India and Turkey after India failed to assure US of ‘equitable and reasonable’ market access & Turkey wasn’t sufficiently economically developed https://t.co/1MNrcPrjIf
— Linda Yueh (@lindayueh) March 5, 2019
The President of the United States added in a letter, adresses to congressional leaders: “I am taking this step because, after intensive engagement between the United States and the government of India, I have determined that India has not assured the United States that it will provide equitable and reasonable access to the markets of India.”
From 2006 to 2018 Chinese trade with sub-Saharan Africa increased by 226%, and India’s by 292% pic.twitter.com/igdHGaJX3R
— Agathe Demarais (@AgatheDemarais) March 8, 2019
According to experts, this escalation of tariffs is only going to worsen the international trade situation, although it might be beneficial for jobs within the United States, as the China Tariffs showed.
Read out story on China and US Talks here
India calls U.S for diplomacy
A few days after this imbroglio, India called the United States as the crisis in Kashmir between the national Indian forces and the Pakistan army has worsened.
Last episode in date: Ami Bera, an Indian-American Congressman, was asked by the American government to help on the crisis at the border, as tensions have increased for the past few weeks.
Learn about India and Pakistan's ballistic missile capabilities on the @Missile_Defense microsite:
— CSIS (@CSIS) March 5, 2019
Experts say that a nuclear war between Pakistan and India is highly likely, while India asked the U.S to investigate on Pakistani’s alleged American made F-16 jets flying over its territory.
No official explanation has been given yet, but it seems that the jets were stolen from the U.S Army and might be used by Pakistan organizations – although many experts could only confirm this was simply a supposition.
For Congressman Ami Bera, it is crucial for Pakistan to fight more efficiently against terrorism. “Pakistan has banned many of these terrorist groups, including adding two more groups on March 5, but at the same time tolerates them operating within its own borders. This has caused the international community to isolate Pakistan”.
India buys Venezuala’s gas
And while it seems to symbolize a definitely very globalized world, the American government said it was ready to help India regarding Pakistan, only if it would stop buying gas from Venezuela.
“We say you should not be helping this regime. You should be on the side of the Venezuelan people,” Elliott Abrams told Reuters in an interview.
— Sputnik (@SputnikInt) March 10, 2019
According to the press agency, it seems that the Trump administration has been giving the same advice to other countries, including Turkey, who is also facing the end of its preferential agreement.
Foreign banks and companies were also warned that keeping their business in Venezuela and doing business with Maduro would put in danger the sustainability of their business settled in the United States.
Abrams, a reckoned American lawyer, shared his impressions to Reuters, condemning the United States’ approach as “arguing, cajoling, urging.”
“The talks with India come as the United States and its regional allies, who back Venezuelan opposition leader Juan Guaido, threaten more sanctions to cut off revenue streams to Maduro’s government and force him to step down.”, he added.
As a reminder, Washington currently considers Guaido as the legitimate leader of Venezuela and has declared it would put sanctions on the south American country’s oil sector. L
ast but not least, the American government said it would freeze all the freezes and visas from top executives, therefore targeting top Venezuelian officials.
Take The Next Step with Alvexo Leave your details and we’ll reach out shortly.