India and US Reach Agreement on Terms for Initial Phase of Trade Deal, Says Indian Official
India and US finalize terms for trade talks, aim for “win-win” deal in 90 days
India and the US have reached an agreement on the terms of reference for discussions on the first phase of a bilateral trade deal, with hopes that a mutually beneficial agreement could be reached in the next 90 days. This development comes after US President Donald Trump announced a pause on tariff hikes for major trading partners, including India.
The two countries had previously agreed in February to work towards a trade deal that would boost bilateral trade to $500 billion by 2030. According to an Indian trade official, progress in the trade talks with the US is ahead compared to other countries, and there are many possibilities for collaboration in the next 90 days.
In light of Trump’s tariff pause, India is eager to expedite the process of clinching a trade deal with the US. Discussions will continue virtually and regularly, with the possibility of delegation-level visits from both sides. Additionally, US Vice President JD Vance is expected to visit India in the near future.
Despite the recent tariff announcement by the US administration, India has chosen not to retaliate. Bilateral trade between the two countries reached around $129 billion in 2024, with India enjoying a trade surplus of $45.7 billion.
To prevent re-routing of goods through India to the US, India has heightened scrutiny of exports and imports. The country has also established a global tariff and trade helpdesk to assist stakeholders in navigating trade challenges.
In the wake of increased tariffs on Chinese goods by the US, trade analysts have raised concerns about potential trade diversion through India. However, the Indian official emphasized that India aims to maintain its status as a trusted trading partner and will not become a source of trade diversion.
Prime Minister Narendra Modi has reiterated the importance of maintaining India’s credibility as a reliable trading partner, both to government officials and industries. With ongoing discussions and a commitment to transparency, India and the US are working towards a mutually beneficial trade agreement.
