The two sides are keen to utilise the 90-day tariff pause, announced by US President Donald Trump on April 9, to push the talks
The official team from India is visiting the US to give further impetus to the negotiations in the 90-day tariff pause window.
Both sides will discuss the terms of references (ToRs) to iron out differences on key matters before formally launching talks for the bilateral trade agreement (BTA).
The parleys will deal with around 19 chapters including regulatory issues, tariffs, non-tariff barriers, and customs facilitation.
Brendan Lynch, the Assistant US Trade Representative for South and Central Asia, was in India from March 25 to 29 for crucial trade discussions with Indian officials.
From 2021-22 to 2024-25, the US was India's largest trading partner. The US accounts for about 18 per cent of India's total goods exports, 6.22 per cent in imports, and 10.73 per cent in bilateral trade.
Additional Secretary in the Department of Commerce Rajesh Agrawal will lead the negotiating team for the first in-person talks between the two countries. The U.S.-India strategic partnership is founded on shared values including a commitment to democracy and upholding the rules-based international system.
The United States and India have shared interests in promoting global security, stability, and economic prosperity through trade, investment, and connectivity.
Then-President Biden and Prime Minister Modi held two in person bilateral meetings during which they reaffirmed their commitment to a resilient, rules-based international order that safeguards sovereignty and territorial integrity, upholds democratic values, and promotes peace and prosperity for all.
Then-President Biden and Prime Minister Modi also participated in multiple engagements of the Quad Leaders mechanism with Japan and Australia.
The United States supports India’s emergence as a leading global power and a vital partner in efforts to safeguard the Indo-Pacific as a region of peace, stability, and growing prosperity.
Agrawal was appointed as the next commerce secretary on April 18. He will assume office from October 1.
India and the US have been engaged in negotiating a bilateral trade agreement since March. Both sides have targeted to conclude the first phase of the pact by the fall (September-October) of this year, with an aim to more than double the bilateral trade to USD 500 billion by 2030, from about USD 191 billion, currently.
In a trade pact, two countries either significantly reduce or eliminate customs duties on the maximum number of goods traded between them. They also ease norms to promote trade in services and boost investments.
The Americans are looking at duty concessions in sectors like certain industrial goods, automobiles (electric vehicles particularly), wines, petrochemical products, dairy, and agriculture items such as apples, tree nuts, and alfalfa hay.
India may eye towards duty cuts for labour-intensive sectors like apparels, textiles, gems and jewellery, leather, plastics, chemicals, oil seeds, shrimp, and horticulture products.
To address the gap and boost manufacturing, the Trump administration announced sweeping tariffs on April 2, including 26 per cent on India. It was later suspended for 90-day till July 9.
In 2024, India's main exports to the US included drug formulations and biologicals (USD 8.1 billion), telecom instruments (USD 6.5 billion), precious and semi-precious stones (USD 5.3 billion), petroleum products (USD 4.1 billion), gold and other precious metal jewellery (USD 3.2 billion), ready-made garments of cotton, including accessories (USD 2.8 billion), and products of iron and steel (USD 2.7 billion).
Imports included crude oil (USD 4.5 billion), petroleum products (USD 3.6 billion), coal, coke (USD 3.4 billion), cut and polished diamonds (USD 2.6 billion), electric machinery (USD 1.4 billion), aircraft, spacecraft and parts (USD 1.3 billion), and gold (USD 1.3 billion).
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