While India might even like to take the GSP hit in its stride and move on, the importance of talking to Pompeo cannot be underestimated.
The Mike Pompeo visit to India assumes larger significance in the wake of certain developments in India-US ties that have led to severe anxiety on the economic side. As Secretary of State, Mr Pompeo’s brief may not strictly cover trade, but as Donald Trump’s go-to man — who signalled positivity in repeating the ruling party poll catchline of “Modi hai tho mumkin hai” — he is likely to discuss the whole gamut of issues with India. The loss of the Generalised System of Preferences status is a hit for India even if it’s a minuscule dot on the US economy as it involves the import of only about $190 million of Indian goods. Shades of bitterness are visible in this charade over trade ties in which sphere there has been much posturing by Mr Trump centred on tariffs on the iconic Harley Davidson motorcycles.
Considering the political ties are on a strong wicket, India may have to give some, in the field of large arms purchases from Russia, in order to get some, which might be in terms of privileges in H1B visas and, perhaps, restoration of GSP status. The bigger issue is one of data management in which India has taken a tough stand in asking the likes of Mastercard to store their Indian data in the country rather than in the US. As the ties on the political side remain steadfast in what could otherwise be tricky strategic relations with the world’s leading power, the understanding that the trade issue can be bundled up with all else and India’s viewpoint presented strongly to Mr Pompeo might help establish a positive direction in a difficult phase. While India might even like to take the GSP hit in its stride and move on, the importance of talking to Mr Pompeo cannot be underestimated.