PM Narendra Modi’s visit convinces US to grant market access to Indian aluminium & steel

The Indian Prime Minister Narendra Modi's recent visit to the United States and Egypt has brought in a solution from both the economic and strategic perspectives. The bilateral meeting among the three countries has resolved six major disputes at World Trade Organisation related to aluminium, steel, renewable energy, and solar cells. Out of six, three disputes were raised by the US against India (DS456, DS541 and DS585), and the latter raised the remaining three against the former (DS436, DS510 and DS547).

Following the meeting, the United States agreed to give market access to aluminium and steel products under the exclusion process of Section 232 of the Trade Expansion Act 1962, which will again provide export opportunities to the Indian aluminium and steel manufacturers after a long gap since 2018. India, in return, also agreed to remove retaliatory tariffs on certain products from the US.

According to a report published by the State Bank of India (SBI) on Monday, July 3, the market access granted by the US will ramp up India’s aluminium and steel exports by about 35 per cent.

Prime Minister Narendra Modi’s US visit also convinced the US chip manufacturers to start production in India. Some chip manufacturers have already announced an FDI of US$825 million with a combined investment of US$2.75 billion to establish a semiconductor assembly and test facility in India.

Both the United States and India also strengthened their defence relationship in the meeting. As per the report, India will become a hub for repair and maintenance of naval assets.

"This will cover prototyping of projects, testing, collaborative research, and co-production of defence systems," according to the SBI.