NEW DELHI: Finance minister Nirmala Sitharaman has called for an early conclusion of the India-US trade agreement, stressing its importance for bilateral economic relations and global trade.Her remarks come a day after commerce and industry minister Piyush Goyal said the first phase of the trade pact had been finalised and was currently undergoing legal drafting.“I think recently the Indian commerce minister has also spoken that they expect and wish to have the agreement signed soon. Negotiations have been going on. I hope, in the interest of global trade and in the interest of trade between the two partners, India and US, the trade agreement gets concluded at the earliest,” she said on Friday.FM Sitharaman also raised concerns over India’s trade relationship with China, particularly the growing imbalance and the difficulties Indian businesses face in accessing the Chinese market.Despite years of engagement with Beijing, India has made little headway in securing greater market access for several products, including generic medicines, bovine meat, vegetables and other perishable goods, she said.Speaking to the Atlantic Council on the sidelines of the IMF-World Bank annual meetings in Bangkok, Thailand, the finance minister pointed to non-tariff restrictions as a key impediment to trade between the two countries.“Non-tariff barriers are the biggest hurdle in the trade between India and China,” she said. China had continued to use phytosanitary measures and other non-tariff restrictions, she added, despite the possibility of addressing these issues through discussions and investigations.Sitharaman said India had chosen negotiations over punitive tariffs as a means of tackling substantial trade imbalances with its trading partners, even if reaching a resolution took time.
BRICS should focus on people’s welfare
On BRICS, minister Sitharaman rejected the view that the grouping’s purpose was to counter another country or bloc. Instead, she said, its focus should be on strengthening cooperation for the benefit of its people.“I don’t think BRICS’s intention is to counter others. It is more to strengthen the partnership through the BRICS,” she added.She highlighted the grouping’s scale, noting that its member countries represented nearly 40 per cent of the world’s population. Greater cooperation among them could support trade, improve mutual understanding and open up economic opportunities, she said.Sitharaman also pointed to the expanding membership of BRICS, with 11 to 12 countries actively engaging with one another and collectively accounting for around 45 per cent of global trade.
Infrastructure spending has helped sustain India’s growth
Turning to the domestic economy, Sitharaman said India had maintained strong growth despite disruptions across the world. The country had been the fastest-growing major economy over the previous four to five years, particularly since the COVID-19 pandemic, she said.She credited this performance to a combination of inclusive growth, improved access to resources, skill development for young people, fiscal prudence and higher public capital expenditure.The finance minister emphasised the role of infrastructure investment in supporting economic activity, saying it had a stronger multiplier effect than directly transferring an equivalent amount of money to people. Such investment also generated employment, she said.According to Sitharaman, public expenditure on infrastructure allows money to reach people through the economic activity it creates, while avoiding the same degree of pressure on the fiscal deficit that some other forms of spending could entail.She also linked government borrowing to the creation of infrastructure assets, arguing that the approach had delivered economic benefits. “Borrowing goes for asset creation, and as a result, the economy has benefited,” she said.
