India trade officials plan meeting their US counterparts next week in New Delhi to negotiate access to American medical devices, people with knowledge of the matter said.
India’s government is inclined to accept a demand by US medical device makers for easing a policy on capping prices, they said, asking not to be identified as the discussion is private.
On Wednesday, India raised tariffs on a slew of US imports in retaliation to higher levies imposed on some of its products, but medical devices weren’t a part of it.
The capping of prices of more than 20 drugs, along with cardiac stents, drug-eluting stents, condoms, intrauterine devices and knee implants, was part of a separate policy to lower medical costs for Indians. Most of these products are imported and American companies dominate the $10bn market.
In return, New Delhi is hoping the US will not carry out a threat of reviewing a system that allows duty-free entry of about 2,000 products including auto-components, industrial valves, and textile materials, the people said.
Under President Donald Trump, the US said in April it will review India’s eligibility for its Generalized System of Preferences programme after some local companies said dairy and medical devices shipments were being hurt by non-tariff barriers.
Officials from the US will be in India next week to discuss the framework of the deal that, if finalised, would be one of the first signals of the trade partners returning to bilateral talks after Washington raised concerns over a trade surplus. India’s surplus – merchandise and services – with the US stood at $28bn in 2017 – marginally lower than the $30.8bn in 2016.
While India would also raise the issue of high duty on steel and aluminium, and visa issues among others, it is the GSP that is likely to be on top of the agenda.
The proposed meeting between officials of the two nations follows Commerce Minister Suresh Prabhu’s visit to the US early this month to discuss the unilateral measures taken by the US against India.