India-US Trade Agreement Talks Progressing
Negotiations for a bilateral trade agreement between India and the United States are moving ahead, according to a senior government official. The Indian team is set to travel to Washington soon to further enhance discussions.
Commerce Secretary Sunil Bhaswal confirmed that an Indian delegation will engage in talks in Washington. Starting on May 17, Commerce and Industry Minister Piyush Goyal will lead this team, meeting with US officials to advance the discussions on the agreement.
During his visit, Goyal plans to meet with US Trade Representative Jamieson Greer and US Secretary of Commerce Howard Lutnick. He’ll be in Washington from May 17 to 20, while India’s chief negotiator, Rajesh Agrawal, will continue talks with his US counterpart from May 19 to 22.
The backdrop for these consultations involves both nations exploring the possibility of a provisional agreement on goods, aiming for a quick “mutual victory” before the finalization of the trade agreement’s first phase this fall.
“The talks are ongoing and progressing well,” the official stated, indicating a positive outlook as they aim to strengthen ties. Meanwhile, former President Donald Trump stated that India had agreed to “zero tariffs” on some US goods, a point that created some tension, given that India has high tariff rates.
Foreign Minister S. Jaishankar remarked on the complexity of these negotiations, acknowledging that nothing will be settled until every aspect is resolved. He emphasized the need for any agreements to be beneficial for both countries and noted that it might be premature to draw conclusions just yet.
Regarding timelines, there’s hope to finalize initial agreements by this fall. “We want to close this transaction as quickly as possible,” the official said, adding that a goal of doubling bilateral trade to $500 billion by 2030 is set. Both sides are reportedly seeing an increase in exports and imports.
Main issues still on the table include market access, origin rules, and non-tariff barriers. The current discussions aim to utilize a 90-day tariff suspension to push consultations forward, with the US having suspended India’s 26% tariffs until July 9 to tackle the growing trade deficit.
Nevertheless, a 10% baseline tariff on US goods remains intact. To kickstart progress in talks, Agrawal and US trade aides held consultations recently in Washington. Goyal had previously met with Greer and Lutnick in March, and sector-level discussions between India and the US have already begun.
This ongoing engagement has made the US India’s largest trading partner for the fourth consecutive year, with bilateral trade reaching $131.84 billion. The US represents around 18% of India’s total goods exports, 6.22% of imports, and 10.73% of the country’s overall commercial trade.
