India & US may finalise interim trade deal by June 25 ahead of Donald Trump’s tariff deadline
India-US trade deal: A bilateral trade agreement between US President Donald Trump-led US and PM Narendra Modi-led India could be sealed as early as the end of June. A delegation of US officials is scheduled to visit India in June for trade discussions.The focus remains on securing an interim trade arrangement before finalising the first phase of the bilateral trade agreement (BTA), particularly as the USA’s 26 per cent reciprocal tariff on India remains suspended until July 9 this year. This tariff was implemented by the US on April 2. Currently, Indian exports continue to face America’s standard 10 per cent baseline tariff.Sources told PTI that a potential interim trade agreement could be reached by June 25. “Talks are moving. Things are on track,” according to these sources.Also Read | Explained: Why India is well positioned to deal with negative effects of Trump’s tariffs & top reasons it will be at an advantageSpecial Secretary Rajesh Agrawal from India’s Department of Commerce, who serves as the country’s primary negotiator, recently completed a four-day diplomatic mission to Washington. During his stay, he engaged in discussions with his American counterpart regarding the proposed agreement.Additionally, Commerce and Industry Minister Piyush Goyal visited Washington recently to advance the trade negotiations. His agenda included two meetings with US Commerce Secretary Howard Lutnick.India-US trade deal talks
- In the ongoing trade negotiations, India seeks complete relief from the 26 per cent reciprocal duty imposed on its domestic products.
- India and the US have established a target to finalise the initial phase of the suggested BTA before autumn (September-October) this year.
- India seeks to negotiate duty reductions in the proposed agreement with America, focusing on sectors that employ a significant workforce, including textiles, gems and jewellery, leather products, garments, plastics, chemicals, shrimp, oil seeds, chemicals, grapes and bananas.
- The United States, in return, is requesting tariff reductions across various sectors, including industrial products, automobiles (particularly electric vehicles), wines, petrochemical items, dairy products and agricultural goods such as apples, tree nuts and GM (genetically modified) crops.
- India maintains strict regulatory standards regarding GM crop imports from the US, making their entry unfeasible. However, New Delhi remains receptive to importing non-GM products, including Alpha alpha hay, which serves as cattle feed.
The United States maintained its position as India’s main trading partner for the fourth straight year in 2024-25, with two-way trade reaching $131.84 billion. The US constitutes approximately 18 per cent of India’s overall goods exports, 6.22 per cent in imports, and 10.73 per cent of the nation’s total merchandise trade.Also Read | Forced to destroy! US rejects 15 mango shipments from India, exporters estimate losses of $500,000India registered a positive trade balance (exports surpassing imports) with the US, amounting to $41.18 billion in goods during 2024-25. Previous figures show $35.32 billion in 2023-24, $27.7 billion in 2022-23, $32.85 billion in 2021-22 and $22.73 billion in 2020-21. The US has expressed apprehension regarding this increasing trade imbalance.Both trading partners aim to increase bilateral trade to $500 billion by 2030, which will be a more than a twofold increase from current levels.A finance ministry report suggests that a successful trade deal between India and the US could transform existing challenges into opportunities, potentially creating new avenues for market access and enhancing exports.Also Read | Remittances tax: How Donald Trump’s ‘The One Big Beautiful Bill’ may turn out to be ugly for Indians in the US
