NEW DELHI: India and the US are gearing up to negotiate a multi-sector Bilateral Trade Agreement (BTA) aimed at expanding trade agreements bertween two countries, market access, slashing tariffs, and easing non-tariff barriers, the government informed Parliament on Tuesday.
In a written reply to the Lok Sabha, Minister of State for Commerce and Industry Jitin Prasada clarified that no reciprocal tariffs have been imposed by the US on India so far.
“Both countries plan to negotiate a mutually beneficial trade agreement, focusing on increasing market access, reducing tariff and non-tariff barriers, and enhancing supply chain integration,” he said.
The US issued a Memorandum on Reciprocal Trade and Tariffs on February 13, directing the Commerce Secretary and the US Trade Representative to investigate trade imbalances and propose remedies for non-reciprocal arrangements with trading partners.
$500bn target for 2030
During Prime Minister Narendra Modi’s recent visit to Washington, both nations committed to doubling two-way trade to $500 billion by 2030. The first tranche of the BTA is expected to be finalized by fall 2025.
In 2023, India-US bilateral trade in goods and services stood at $190.08 billion, with India’s exports at $123.89 billion and imports at $66.19 billion. Merchandise exports alone totaled $83.77 billion, leaving India with a trade surplus of $43.65 billion – making the US one of the few countries where India enjoys a trade advantage.
Key exports & tariff policy
Between 2021-24, the US remained India’s largest trading partner. In 2023-24, India’s key exports to the US included:Engineering goods ($17.62 billion); Electronics ($10 billion); Gems & Jewellery ($9.9 billion); Petroleum products ($5.83 billion); Textiles ($4.7 billion) and Marine products – $2.5 billion.
On tariffs, Prasada noted that India’s trade policy aims to regulate imports, protect domestic industries, and generate revenue, while also shifting towards more Preferential and Free Trade Agreements (PTAs & FTAs) to reduce trade barriers.
India is already a member of 13 FTAs and 9 PTAs and is currently negotiating deals with the EU, the UK, and Oman to further expand its trade network.
