The Indian delegation engaged in talks with the American team led by Assistant US Trade Representative Brendon Lynch in New Delhi. Discussions have been focused on improving market access, reducing tariff and non-tariff barriers, and enhancing supply chain resilience and integration.
Last week, Commerce and Industry Minister Piyush Goyal stated that India and the US intend to provide preferential market access to businesses while continuing bilateral efforts to resolve issues such as tariffs on aluminium and steel. Sources suggested that an interim deal appears likely ahead of the first tranche of the proposed BTA.
On May 21, government officials revealed that India is seeking full exemption from the additional 26% tariffs as part of the interim trade agreement under discussion with the US. The target is to secure the deal by July 9, thereby avoiding the imposition of reciprocal tariffs, which remain temporarily suspended by the world’s largest economy.Officials stated that goods and digital services are expected to be included in the interim trade agreement with the US. However, they noted that the Trump administration does not have the authority to lower tariffs below the Most-Favoured Nation (MFN) rate without approval from the US Congress.
Nevertheless, the US government does have the power to remove reciprocal tariffs for several countries, including India. The American side is also seeking concessions on industrial goods, automobiles, wines, petrochemical products, dairy, and other agricultural products.
India is looking to secure a minimum import price (MIP) or import quotas in sensitive sectors such as dairy and agriculture as part of the agreement.
Additionally, the Indian government is advocating for a reduction of 5% to 7% in Basic Customs Duty (BCD) on exports of labour-intensive products, such as leather.
Both nations are working towards doubling bilateral trade to $500 billion, aiming to sign the first tranche of a comprehensive multi-sector trade agreement by October 2025.
