India and US Advance Bilateral Trade Agreement Talks

 New Delhi, March 29, 2025 – India and the United States have agreed to initiate sectoral discussions under the proposed Bilateral Trade Agreement (BTA) in the coming weeks, the Ministry of Commerce announced on Saturday. This development follows four days of negotiations between senior officials from both nations, aimed at strengthening economic ties and achieving the ambitious target of expanding bilateral trade to $500 billion by 2030.

Progress in Bilateral Trade Discussions

The negotiations were a continuation of the commitments outlined in the India-US Joint Statement issued on February 13, 2025. According to the ministry, "Sectoral expert-level engagements under the BTA will commence virtually in the coming weeks, paving the way for an in-person negotiating round at the earliest opportunity."

Both sides have made significant progress toward a mutually beneficial, multi-sectoral BTA, with the objective of finalizing the first tranche by fall 2025. Discussions focused on key areas such as enhancing market access, reducing tariff and non-tariff barriers, and strengthening supply chain integration.

A delegation of US officials, led by Assistant US Trade Representative for South and Central Asia Brendan Lynch, participated in the negotiations. These discussions build on Commerce and Industry Minister Piyush Goyal’s visit to Washington from March 4-6, where he met US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick.

Strategic Economic Cooperation

The successful conclusion of these discussions marks a significant step in expanding India-US trade and investment relations. "These measures aim to unlock new business opportunities, deepen bilateral economic integration, and reinforce the economic partnership between the two nations," the ministry stated.

Both India and the US expressed satisfaction with the meeting's outcomes and reaffirmed their commitment to continued collaboration. The negotiations are expected to culminate in a trade agreement that aligns with shared goals of economic growth, resilience, and mutual prosperity.

US President's Perspective on Trade Relations

On Friday, US President Donald Trump reiterated his stance on trade negotiations with India, describing Prime Minister Narendra Modi as "a very smart man" and "a great friend." He acknowledged ongoing tariff discussions, asserting confidence that "it’s going to work out very well between India and our country."

Trump has frequently criticized high tariffs imposed by India on American goods and has announced reciprocal tariff measures set to take effect on April 2. The US is particularly keen on securing tariff reductions for sectors such as automobiles, petrochemicals, and agricultural products, including apples, tree nuts, and alfalfa hay. Conversely, India is seeking concessions for labor-intensive industries such as textiles.

India’s Trade and Investment Landscape

India’s industry and exporters have urged the government to negotiate favorable terms under the proposed agreement and seek exemptions from the US’s reciprocal tariffs. Experts suggest that India is unlikely to include dairy and agriculture in trade talks due to the sector’s political sensitivities.

The US exported agricultural products worth $1.6 billion to India in 2024, with key exports including almonds ($868 million), pistachios ($121 million), apples ($21 million), and ethanol ($266 million). In June 2023, India removed retaliatory import duties on eight US products, including chickpeas, lentils, and apples, which were imposed in response to US tariffs on steel and aluminum.

In 2024, India’s major exports to the US included pharmaceutical formulations ($8.1 billion), telecom equipment ($6.5 billion), precious and semi-precious stones ($5.3 billion), and petroleum products ($4.1 billion). The US, in turn, exported crude oil ($4.5 billion), coal ($3.4 billion), cut and polished diamonds ($2.6 billion), and aerospace components ($1.3 billion) to India.

For the fiscal year 2023-24, the US remained India’s largest trading partner, with total bilateral trade in goods amounting to $119.71 billion. India recorded a trade surplus of $35.31 billion, exporting goods worth $77.51 billion to the US while importing $42.19 billion worth of American products.

Additionally, between April 2000 and September 2024, the US contributed $67.8 billion in Foreign Direct Investment (FDI) into India, reinforcing the strong economic partnership between the two nations.

Outlook for the India-US Trade Agreement

With negotiations advancing steadily, India and the US aim to finalize the initial phase of the BTA by September-October 2025. The agreement is expected to foster deeper trade relations and create new economic opportunities for businesses across both countries. The upcoming sectoral engagements will be instrumental in shaping the final contours of the agreement, ensuring a balanced approach that benefits both economies.

As India and the US work toward strengthening their trade ties, the forthcoming agreement is poised to play a crucial role in shaping the future of global trade partnerships.