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US-India Trade Deal Breakthrough: First Phase Nears Completion Amid Tariff Tensions

India and the United States are making significant progress on their bilateral trade agreement. The first phase focusing on reciprocal tariffs is nearly finalized according to Commerce Secretary Rajesh Agrawal. This deal aims to dramatically increase trade between the two nations from current levels to $500 billion by 2030. Despite recent tariff escalations by the US, both countries continue productive virtual negotiations while India protects its sensitive agricultural sectors.

Key Points: US India Trade Deal First Tranche Nears Closure Commerce Secretary

  • First trade deal phase focuses on resolving reciprocal tariff disputes between nations
  • BTA aims to increase bilateral trade from $191B to $500B by 2030
  • Negotiations continue despite recent US tariff hikes on Indian goods
  • India maintains reservations about US access to agricultural and dairy sectors
  • Separate LPG supply arrangement progressing to maintain trade balance
2 min read

First tranche of US-India trade deal is near closure: Commerce Secretary

India and US near completion of first trade deal phase addressing reciprocal tariffs, aiming to boost bilateral trade to $500 billion by 2030 despite recent tariff escalations.

"The part relating to reciprocal tariffs should happen sooner rather than later - Commerce Secretary Rajesh Agrawal"

New Delhi, November 17

India remains engaged with the United States on the proposed Bilateral Trade Agreement (BTA), and the first tranche of the deal, focused on addressing reciprocal tariffs, is now "near closure", Commerce Secretary Rajesh Agrawal said on Monday while releasing the October trade data.

Agrawal noted that India and the US have been holding virtual discussions on the BTA for months.

The agreement comprises two components, he explained: one that will naturally take more time to negotiate, and a first tranche aimed at resolving tariff-related issues.

"The part relating to reciprocal tariffs should happen sooner rather than later," he said, while cautioning that specific deadlines cannot be set.

The BTA, formally proposed in February following directives from the leadership of both nations, seeks to more than double bilateral trade, from the current USD 191 billion to USD 500 billion by 2030. Talks were first announced during Prime Minister Narendra Modi's visit to Washington earlier this year.

In recent months, negotiations have continued despite tariff escalations by the United States. US President Donald Trump imposed a 25 per cent tariff on Indian goods starting August 1, followed by another 25 per cent increase days later, citing India's continued purchase of Russian oil. The US has imposed reciprocal tariffs on several countries where it faces trade deficits.

Government officials last week said discussions on the BTA are progressing well and emphasized that the pact would be "highly detailed and fully aligned with WTO norms." They added that negotiations are being undertaken with sensitivity to key sectors, and an additional round of talks may not be necessary.

Meanwhile, Agrawal confirmed that an India-US LPG supply arrangement, long under consideration, is also moving forward.

He clarified that the prospective LPG purchase is not linked to the trade negotiations but is intended to help maintain the overall trade balance between the two countries.

Over the past few months, both sides have explored an interim trade arrangement; however, India has expressed reservations over US proposals seeking greater access to India's agricultural and dairy sectors. These sectors remain sensitive for India, given their critical role in employment and livelihoods for millions.

- ANI

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Reader Comments

R
Rohit P
$500 billion target by 2030 seems ambitious but achievable. The US remains our largest trading partner, and resolving tariff issues will benefit both economies. Good to see progress after months of virtual talks.
A
Anjali F
I'm concerned about the US pressure on agriculture and dairy sectors. Our government must stand firm - these are livelihood issues for millions of Indians. Trade deal should not compromise food security.
S
Sarah B
As someone working in export business, the tariff reductions can't come soon enough! The 25% additional duties have hurt many small exporters. Hope this first tranche brings immediate relief.
V
Vikram M
The timing is interesting given the US elections next year. Hope this deal doesn't get caught in political crossfire. We need stable trade relations regardless of who's in White House.
K
Karthik V
Good to see the LPG arrangement moving forward separately. Energy security is crucial, and diversifying suppliers makes sense. The trade balance approach shows strategic thinking. 👍

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