India and US Prioritize Tariffs and Supply Chains in Trade Discussions

Intensified Dialogues Between India and the US on Trade Agreement

India and the United States are intensifying discussions regarding tariffs, market access, and supply chain collaboration as part of the envisioned Bilateral Trade Agreement (BTA). The objective is to avert new American tariffs while aiming to double bilateral trade to $500 billion by 2030. Both nations are targeting the completion of the initial phase of this agreement by the fall of 2025.

To achieve this ambitious plan, leaders from both countries have unveiled intentions to negotiate a comprehensive and mutually advantageous initial tranche of the multi-sector BTA by autumn 2025, according to recent reports from Reuters.

Active Engagement in Negotiations

Currently, India and the US are diligently engaged in productive discussions aimed at enhancing market accessibility, lowering both tariff and non-tariff obstacles, and fortifying supply chain stability and integration. A senior official indicated that the focus is on expediting the resolution of the first phase of the BTA. In line with these negotiations, a US delegation led by the Assistant US Trade Representative is visiting India from June 4 to June 10.

Follow-Up on Productive Meetings

This visit follows successful talks in May when Commerce and Industry Minister Piyush Goyal led an Indian delegation to the US from May 17 to 22, meeting with key figures including Secretary of Commerce Howard Lutnick and USTR Jamieson Greer. “To push forward with the comprehensive and future-oriented Bilateral Trade Agreement, India and the US are adopting a coordinated and strategic methodology,” the official stated. Goyal expressed optimism, stating, “We are making significant strides and engaging in thorough conversations. I have great confidence in the beneficial outcomes that will arise from this.”

Avoiding New Tariffs

The initial tranche of the BTA aims to help India evade the full implementation of reciprocal tariffs announced by the US on April 2. While an additional 26% tariff on Indian goods has been declared, it is currently suspended until July 9. As it stands, Indian exports are subject to an additional 10% baseline tariff. Should an agreement not be reached by July 9, the US will enact these reciprocal tariffs on all trade partners.

Committing to ‘Mission 500’

During the India-US Leaders’ Summit held on February 13, both nations reiterated their dedication to strengthening trade relations through “Mission 500,” a new initiative aimed at more than doubling bilateral trade to $500 billion by 2030. To fulfill this ambition, plans for negotiating the first tranche of a beneficial multi-sector Bilateral BTA have been set for the autumn of 2025.