India–US Trade Deal Is ‘Only a Matter of Time,’ Says Commerce Secretary

India Says First Phase of India-US Trade Deal Is ‘Only a Matter of Time’

India and the United States appear to be inching closer to a significant trade breakthrough, with Commerce Secretary Rajesh Agarwal stating that a first-phase India-US trade deal is now “only a matter of time.” Speaking on November 28, Agarwal said both nations have been engaged in “deep and continuous” negotiations over recent months, ironing out most of the sticking points.

“We have engaged on it very deeply with the US team for the last few months,” Agarwal said. “We are close. We have tried to iron out most of the issues. Now, it is only a matter of time before both countries find the right landing zone to announce the deal.”

His remarks come at a crucial juncture, as India seeks relief from steep reciprocal tariffs imposed by Washington, while the US pushes for wider market access and stronger trade discipline.

Government Hints at Resolution Within This Calendar Year

Agarwal expressed optimism that the framework agreement could be wrapped up before the current calendar year ends, though he cautioned against assigning rigid deadlines due to the complexity of trade negotiations.

“With any trade negotiation, the final deadline cannot be fixed,” he said. “Even one unresolved issue in the mind of either partner can delay the deal. But the overall position is well set to deliver it in the next few weeks or months.”

His comments reflect growing anticipation within industry circles that both nations may soon formalise a limited trade package, serving as a precursor to a broader Bilateral Trade Agreement (BTA).

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Tariffs on Indian Goods at the Heart of Negotiations

Agarwal emphasized that India will only consider the upcoming deal meaningful if both sets of tariffs are addressed simultaneously.

“A trade deal will be beneficial only when both 25 percent tariffs are addressed. Until then, it will not be meaningful for India,” he said. “Whenever the deal is signed… both these tariffs will be addressed together.”

According to him, technical teams from both nations have been engaging virtually every week, with physical visits expected soon.

Parallel Tracks: Framework Deal First, Full BTA Later

Agarwal clarified that negotiations are progressing on two parallel tracks:

1. A framework trade deal focused on resolving reciprocal tariff challenges

2. A broader Bilateral Trade Agreement (BTA), similar in scope to an FTA, covering market access, standards, services, and regulatory alignment

“What needs to come first is the framework trade deal,” he explained. “It will address the reciprocal tariffs, and one negotiation will feed into the other.”

He noted that a full BTA will “take time” due to its expansive nature, especially with tariff levels beyond the standard Most Favoured Nation (MFN) framework.

US Remains India’s Largest Trading Partner Despite Tariff Tensions

Despite high tariffs and geopolitical frictions, the United States remained India’s largest trading partner for the fourth consecutive year in 2024–25, with bilateral trade valued at $131.84 billion.

The US accounted for:

• 18% of India’s total goods exports

• 6.22% of imports

• 10.73% of India’s merchandise trade

However, India’s exports to the US fell 11.93% to $5.46 billion in September due to tariff pressures, while imports from the US rose 11.78% to $3.98 billion, according to commerce ministry data.

These numbers underline the urgent need for a tariff resolution to stabilise India’s export momentum.

India Seeks Complete Tariff Elimination as Part of Future BTA

Agarwal reiterated that India’s long-term goal is the complete elimination of reciprocal tariffs under any eventual BTA with the United States. He stressed that New Delhi will not rush negotiations at the cost of strategic clarity.

“The BTA will take some time because it is expansive,” he said. “We will not hurry those negotiations. Let the first agreement come first, and then we can determine timelines for the full BTA.”

Industry observers say a phased approach will help minimize disruptions and allow businesses on both sides to adapt to regulatory changes.

A Breakthrough Appears Within Reach as Negotiations Deepen

With trade teams meeting weekly and geopolitical alignment improving, signs point to a potential breakthrough in the coming weeks. Both sides appear eager to stabilise commercial ties after years of tariff disputes.

As Agarwal summarized:

“We are very optimistic and very hopeful. It is only a matter of time.”

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