Bilateral Trade Talks Enter Final Stretch: India, US Aim for Interim Pact With Delegation Meeting Next Month

New Delhi, July 21 — The next round of India-US trade negotiations is scheduled for the second half of August, with a US delegation set to visit India to continue discussions on the proposed bilateral trade agreement. The purpose of the visit is to expedite negotiations, remove bottlenecks in the discussion process, and finalise a trade deal as soon as possible. The discussions are expected to include American demand to grant access to specific sectors such as agriculture and dairy products.

This follows the conclusion of the fifth round of negotiations last week in Washington, led by India’s Chief Negotiator and Special Secretary in the Department of Commerce, Rajesh Agrawal, and Brendan Lynch, the Assistant US Trade Representative for South and Central Asia.

Interim Trade Deal Before August 1 in Focus

The ongoing talks aim to finalise an interim trade pact before August 1, which marks the end of the suspension period for additional tariffs imposed during the Trump administration. The US had announced reciprocal tariffs in April, including a 26% tariff on Indian goods. These were suspended initially for 90 days and later extended until August 1 as trade talks progressed.

India is pushing for the removal of this 26% additional tariff, as well as relaxations on steel (50%), aluminium, and auto sector tariffs (25%). In return, the US is seeking duty concessions on industrial goods, electric vehicles, wines, petrochemicals, agricultural and dairy products, apples, tree nuts, and genetically modified crops.

Agriculture, Dairy, and EVs Among Sensitive Issues

Agriculture and dairy remain contentious points. India has traditionally avoided duty concessions on dairy products in any free trade agreement. Multiple farmers’ associations have also appealed to the government to exclude agricultural issues from the pact.

India has hardened its stance on these US demands and is also seeking duty concessions for its labour-intensive sectors, including textiles, leather goods, gems and jewellery, plastics, chemicals, shrimp, oil seeds, grapes, and bananas.

Key strategic issues, such as non-market economies and the SCOMET list (Special Chemicals, Organisms, Materials, Equipment, and Technologies), were also discussed in the fifth round of negotiations.

WTO Framework and Future Outlook

India has maintained its right under WTO norms to impose retaliatory duties if necessary. However, both nations are working to avoid further trade disruptions and aim to finalise the first tranche of the Bilateral Trade Agreement (BTA) by September–October 2025.

Trade Numbers Indicate Growth Momentum

India’s merchandise exports to the US witnessed strong growth of 22.8%, reaching USD 25.51 billion in the April–June quarter of FY26. Imports from the US rose 11.68% to USD 12.86 billion, reflecting the growing bilateral trade relationship.

As the deadline for tariff suspension nears, the upcoming talks in August will be crucial for laying the groundwork for a comprehensive trade agreement between the two nations.

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