What’s Next for India-US Trade Talks? Key Issues Still on the Table!
India's Trade Negotiations with the US Progress
New Delhi: The Indian delegation, headed by chief negotiator Rajesh Agrawal, has just returned from Washington after wrapping up another round of discussions regarding an interim trade agreement. However, negotiations will persist as some challenges in the agriculture and automotive sectors remain unresolved, according to an official source.
The official indicated that the discussions are nearing completion, with an announcement expected before July 9.
"The Indian team has returned from Washington. Negotiations will continue as there are still issues to address in the agriculture and auto sectors," the official stated.
The Indian representatives were in Washington from June 26 to July 2 to negotiate the interim trade deal with the US.
These discussions are crucial as the suspension of reciprocal tariffs initiated by Trump is set to expire on July 9, prompting both parties to aim for a resolution before that date. India has taken a firm stance against granting duty concessions on American agricultural and dairy products, which are politically sensitive areas.
On April 2, the US implemented an additional 26 percent reciprocal tariff on Indian imports but suspended it for 90 days. Nevertheless, the baseline tariff of 10 percent imposed by the US remains effective. India is advocating for a complete exemption from this additional tariff.
So far, India has not opened its dairy sector to any trading partners in the free trade agreements it has established.
The US is also seeking duty concessions on various industrial goods, including automobiles (particularly electric vehicles), wines, petrochemicals, and agricultural products such as apples, tree nuts, and genetically modified crops.
Conversely, India is pushing for duty concessions in labor-intensive sectors like textiles, gems and jewelry, leather products, garments, plastics, chemicals, shrimp, oilseeds, grapes, and bananas within the proposed trade agreement.
Both nations are aiming to finalize discussions for the first phase of the proposed bilateral trade agreement (BTA) by this fall (September-October). This pact aims to significantly increase bilateral trade from the current USD 191 billion to USD 500 billion by 2030.
Before finalizing the first phase, they are working towards establishing an interim trade agreement.
The US team was last present for these negotiations.
India's merchandise exports to the US surged by 21.78 percent, reaching USD 17.25 billion in April-May of this fiscal year, while imports increased by 25.8 percent to USD 8.87 billion.