Key Points

Speaking at an event in New York, organised by CSIS Chair on India and Emerging Asia Economics, Panagariya said the trade agreement between India and the US can bring a major breakthrough for the country's global investment scenario.

"In the larger interest, one needs to open up (the economy), and particularly, in the present trade tariff context. When you do trade agreements, you also get access to the bigger markets for your exports," he told the audience at the event this week, sharing his vision for a "Rising India".

The present context of the United States raising tariffs has created a different trade dynamics in the world.

"The vibes I hear is that there is a great deal of anticipation in having the US trade agreement done. I generally sense a lot of enthusiasm for this deal, as well as for an agreement down the road with the European Union (EU)," he noted.

After the successful completion of the India-UK Free Trade Agreement (FTA), all eyes on now the trade pact with the European Union (EU). India and the EU have been negotiating an FTA since June 2022, and 12 rounds of the negotiations have been completed, with the last being in July 2025. India and the EU are aiming to reach an agreement on a free trade deal by the end of 2025.

Moreover, a US trade deal with tariffs on labour-intensive Indian products at a lower rate than some of the competitors would be a "big advantage" and present an opportunity.

President Donald Trump has indicated that the US is "very close" to a trade deal with India, and it may be wrapped up soon. The Indian negotiating team, led by Rajesh Agrawal, the special secretary in the Commerce Department, visited Washington this month.

According to Panagariya, "I'm not part of the government in my current position, but there is a very, very keen interest in signing the trade agreements" with the US and other countries.

- IANS