New Delhi, Mar 30: India and the US have decided to hold sector-specific talks in the coming weeks to finalise the structure of the proposed bilateral trade agreement (BTA), the government said on Saturday.
The engagement between the two countries came in the backdrop of the USA’s threat to impose reciprocal tariffs on its key trading partners, including India, on April 2.
The decision to hold discussions in the coming weeks follows four days of talks — between senior officers of India and the US — which concluded here on Saturday.
“Sectoral expert-level engagements under the BTA will start virtually in the coming weeks and pave the path for an early negotiating round in person,” the ministry said.
In a statement, the commerce ministry said to realise the shared objective of promoting growth that ensures fairness, national security and job creation, both sides broadly come to an understanding on the next steps towards a mutually beneficial, multi-sector BTA, with the goal to finalise its first tranche by fall (August-September) 2025.
Through the agreement, the two countries are looking to increase market access for their goods, cut tariff and non-tariff barriers and deepen supply chain integration in a mutually beneficial manner, it added.
“Both sides look forward to building on this milestone in the coming months to finalise the BTA, ensuring it aligns with the shared goals of prosperity, resilience, and mutual benefit,” it added.
A team of US officials, headed by Assistant US Trade Representative for South and Central Asia Brendan Lynch, was here to finalise the contours and terms of references of the proposed pact, aimed at more than doubling the bilateral trade to USD 500 billion by 2030.
The meeting follows the visit of Commerce and Industries Minister Piyush Goyal to Washington from March 4-6 during which he met his US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick and subsequent video conferences between the two sides.
On Friday, US President Donald Trump described Prime Minister Narendra Modi as a “very smart man” while emphasising that tariff talks would “work out very well between India and our country”.
The remarks assume significance since Trump has repeatedly criticised the alleged high tariffs charged by India and other countries on American goods. He has announced plans to impose reciprocal tariffs on its key trading partners, including India, on April 2.
“India is one of the highest tariffing nations in the world. It’s brutal, it’s brutal. They’re very smart. He (Modi) is a very smart man and a great friend of mine. We had very good talks. I think it’s going to work out very well between India and our country,” Trump said.
In a trade pact, two countries either significantly reduce or eliminate customs duties on the maximum number of goods traded between them. They also ease norms to promote trade in services and boost investments.
While the US has demanded duty concessions in sectors like certain industrial goods, automobiles, wines, petrochemical products, dairy, agriculture items such as apples, tree nuts, and alfalfa hay; India may look at duty cuts for labour-intensive sectors like textiles.
Indian industry and exporters have asked the government to protect them against the USA’s reciprocal tariffs. They have sought exemption from those tariffs as it would hurt them severely as the US is India’s largest trading partner.
The US is pushing India to negotiate a large and grand bilateral trade agreement while seeking to open the agriculture sector for American businesses.
According to experts, India is unlikely to include dairy and agriculture in trade negotiations as it is a politically sensitive sector.
The US agri exports to India was USD 1.6 billion in 2024. Key exports include almonds (in shell — USD 868 million); pistachios (USD 121 million), apples (USD 21 million), ethanol (ethyl alcohol USD 266 million).
In June 2023, India announced removal of retaliatory import duties on eight US products, including chickpeas, lentils, and apples, which were imposed in 2019 in response to America’s measure to increase tariffs on certain steel and aluminium products.
In 2024, India’s main exports to the US included drug formulations, biological (USD 8.1 billion), telecom instruments (USD 6.5 billion), precious and semi-precious stones (USD 5.3 billion), petroleum products (USD 4.1 billion), gold and other precious metal jewellery (USD 3.2 billion), ready-made garments of cotton including accessories (USD 2.8 billion), and products of iron and steel (USD 2.7 billion).
Imports included crude oil (USD 4.5 billion), petroleum products (USD 3.6 billion), coal, coke (USD 3.4 billion), cut and polished diamonds (USD 2.6 billion), electric machinery (USD 1.4 billion), aircraft, space crafts and parts (USD 1.3 billion), and gold (USD 1.3 billion).
In 2023-24, the US was the largest trading partner of India with USD 119.71 billion bilateral trade in goods (USD 77.51 billion worth of exports, USD 42.19 billion of imports, with USD 35.31 billion trade surplus).
India has received USD 67.8 billion in foreign direct investments from America during April 2000 and September 2024. (PTI)
