Pompeo pledges close cooperation with India but trade, defence issues unresolved

NEW DELHI: US Secretary of State Mike Pompeo sought to reduce heightened trade tension with India on Wednesday, promising a renewed focus on negotiating improved trade and investment ties between the two nations.

But Pompeo, on a visit to India, gave few specifics of how they would overcome disputes on issues ranging from access to Indian markets for leading American companies to New Delhi's demands for foreign firms to store Indian data in the country, and exports of steel and aluminum to the United States.

The two nations are "friends who can help each other all around the world," Pompeo told a joint news conference with Indian Foreign Minister Subrahmanyam Jaishankar after they met.

The current differences were expressed "in the spirit of friendship", he added.

The disputes have led to higher trade tariffs by the two countries and created unease over the depth of their security alliance.

In particular, the sudden introduction of new e-commerce rules for foreign investors in February angered the Americans because it showed New Delhi was prepared to move the goalposts to hurt two of the largest U.S. companies, discount retailer Walmart, and Amazon.com Inc.

Walmart last year invested $16 billion to buy control of Indian e-commerce firm Flipkart.

Just days before Pompeo's visit, India slapped higher retaliatory tariffs on 28 U.S. products following Washington's withdrawal of key trade privileges for New Delhi.

Jaishankar, a former Indian ambassador to the United States, played down the spat on Wednesday.

"If you trade with someone and they are your biggest trading partner, it is impossible you don't have trade issues," he said.

India's ties with Russia and Iran, both now subject to U.S. sanctions, are also a sore point.

U.S. pressure has led India to stop buying oil from Iran, a top energy supplier. The United States has also stepped up pressure on India not to proceed with its purchase of S-400 surface-to-air missile systems from Russia.

The missile deal and Iranian oil were both discussed during their meeting, Jaishankar and Pompeo said, but mentioned no resolution of either at the news conference.

MODI MEET

Earlier, Pompeo met Prime Minister Narendra Modi for talks at his official residence in the capital, New Delhi, and they exchanged handshakes in images broadcast on television.

"The Prime Minister expressed his strong commitment to achieve the full potential of bilateral relations in trade and economy, energy, defence, counterterrorism and people-to-people contacts," the foreign ministry said in a statement, without elaborating.

Pompeo is expected to round off the trip with a policy speech hosted by the U.S. embassy, before departing on Thursday for a summit of leaders of the Group of 20 nations in Japan.