India and the US to Conclude Trade Pact Discussions

India and US officials are set to hold a wrap-up session on Saturday morning, marking the conclusion of a three-day discussion about a proposed bilateral trade agreement, according to government sources.

The talks are still in their early stages, with a team led by Brendan Lynch, Assistant US Trade Representative for South and Central Asia, currently in New Delhi for negotiations.

As per sources familiar with the discussions, nothing has been finalized at this point. Commerce and Industry Minister Piyush Goyal mentioned on Thursday that the ongoing discussions are progressing positively and are intended to be beneficial for both countries while safeguarding India's interests.

This official discussion is especially important given the recent announcement by US President Donald Trump to impose reciprocal tariffs on key trading partners, including India. Trump has expressed concerns regarding India's high tariffs on US goods.

India has imposed higher import duties of 25% on steel and aluminum since March 12, along with a tariff of 25% on completely built vehicles and auto parts effective from April 3.

India and the US are aiming to finalize the first phase of this trade agreement by the fall of 2025 and have set a goal to more than double bilateral trade, reaching $500 billion by 2030 from the current level of over $190 billion.

The US has requested duty concessions in various sectors including industrial goods, automobiles, wines, and certain agricultural items like apples and tree nuts. Conversely, India might seek duty reductions in labor-intensive sectors such as textiles.

Indian exporters are requesting that the government protect them from the US’s reciprocal tariffs, as these could significantly impact them, given that the US is India's largest trading partner.

In response to US pressures, India reduced import duties on bourbon whiskey and certain wines earlier this year. Additionally, the Indian government has eliminated equalization levies on major tech firms, which could benefit American businesses.

The United States is urging India to consider a more comprehensive trade agreement while also pushing for access to India's agriculture sector. However, experts suggest that including agriculture in the negotiations may be challenging for India, given its politically sensitive nature.

In terms of trade statistics, the US agricultural exports to India reached $1.6 billion in 2024, with key products including almonds, pistachios, and ethanol. Meanwhile, India's major exports to the US in 2024 included pharmaceuticals, telecom instruments, and petroleum products. Imports primarily consisted of crude oil and refined petroleum products.

During the 2023-24 fiscal year, the US emerged as India’s largest trading partner with a total trade volume of $119.71 billion, comprising $77.51 billion worth of exports and $42.19 billion in imports.

Overall, the developments in these trade negotiations will be crucial in shaping the future economic landscape between the two nations.

trade, agreement, negotiation