First tranche of India-US trade pact nearly finalisedTalks focus on preferential US market access for IndiaChina becomes India’s top trading partner in 2025-26
Commerce and industry minister Piyush Goyal stated on Monday that the first tranche of the proposed bilateral trade agreement with the United States is nearly finalised. He added that discussions are ongoing regarding mechanisms to secure preferential market access for India over its competitors in the US.
“We have almost finalised our free trade agreement…the first tranche of the bilateral trade agreement with them. We are trying to close the Ts and dots on that and work out what would be the mechanism by which India can get a preferential access, market access in the US market compared to our competitors,” Goyal said on the sidelines of the India-Korea Business Forum held in the national capital.
“The team will be discussing these aspects while they are in Washington,” he added.
A team of Indian officials is currently in Washington for three-day talks on the first phase of the bilateral trade agreement. Given the changed tariff landscape in the US following the Supreme Court’s decision, the two sides will look at the framework of the interim agreement, the text of which was released on February 7.
According to that framework, the US had agreed to reduce tariffs on India to 18 per cent, from 50 per cent. It had removed the 25 per cent tariffs on Indian goods for buying Russian oil and was to cut the remaining 25 per cent to 18 per cent under the pact.
But on February 20, the US Supreme Court ruled against Trump’s reciprocal tariffs, which were imposed under the 1977 International Emergency Economic Powers Act (IEEPA).
After that, the President announced the imposition of 10 per cent tariffs on all countries for 150 days, starting February 24.
In light of these changes, a meeting between the chief negotiators of India and the US scheduled for February was postponed.
China has overtaken the US to emerge as India’s largest trading partner in 2025-26. The US was India’s largest trading partner for four consecutive years till 2024-25.
