Where do India and US stand on trade talks?
What's the story
A delegation of US officials is expected to visit India soon, as part of continuing talks on a proposed interim trade agreement between the two countries.
The timeline for the agreement is crucial, with both nations looking to finalize it before July 9.
A major sticking point in the talks is India's demand for full exemption from a reciprocal tariff on domestic goods, currently at 26%.
Negotiations
Trade talks intensify with key meetings
As per PTI, the pace of negotiations for the proposed trade agreement is also picking up.
India's chief negotiator, Special Secretary in the Department of Commerce Rajesh Agrawal, recently concluded a four-day visit to Washington where he discussed the proposed agreement with his US counterpart.
Commerce and Industry Minister Piyush Goyal also actively participated by meeting US Commerce Secretary Howard Lutnick twice to expedite trade talks.
Tariff update
US imposes and suspends tariff on Indian goods
On April 2, the US imposed an additional reciprocal tariff of 26% on Indian goods. However, it was later suspended for a period of 90 days until July 9.
Despite the suspension, Indian goods are still subject to a baseline tariff of 10% imposed by America.
The current administration in the US has the authority to remove reciprocal tariffs imposed on several countries including India.
Completion goal
India and US aim to complete trade agreement by October
Both India and the US have set a deadline to wrap up the first phase of their proposed bilateral trade agreement by September-October this year.
However, there are indications that both sides may reach an interim trade deal before this initial phase is completed.
The US has been India's largest trading partner for four consecutive years, with bilateral trade worth $131.84 billion in 2024-25.
Trade balance
India maintains trade surplus with US
The US makes up for nearly 18% of India's overall goods exports, 6.22% in imports, and 10.73% in the nation's overall merchandise trade.
In terms of trade balance, India enjoyed a $41.18 billion surplus with America in goods for 2024-25. It was a tad lower at $35.32 billion in the previous year (2023-24).
The two nations hope to more than double their bilateral trade to $500 billion by 2030.