India-US Trade Deal Negotiations

India has proposed a significant reduction in its tariff differential with the United States, aiming to bring it down to less than 4% from the current 13%. This move is part of efforts to secure an exemption from President Donald Trump's existing and future tariff increases, according to sources familiar with the negotiations.

The bilateral trade between India and the US reached approximately $129 billion in 2024, with India maintaining a surplus of $45.7 billion. The proposed tariff adjustment is one of the most significant modifications to India's trade barriers, reflecting its status as the world's fifth-largest economy.

Strategic Proposals and Negotiations

India has put forward a proposal to eliminate duties on 60% of tariff lines during the initial phase of negotiations. Additionally, it seeks preferential market access for various export sectors, including gems and jewellery, leather goods, and textiles, among others.

Trump's administration has recently secured a "breakthrough deal" with Britain, which may serve as a framework for negotiations with other trading partners, including India. A team of Indian officials is scheduled to visit the US later this month to advance the discussions.

Looking Ahead

India also seeks treatment equivalent to major US allies in strategic technology sectors, such as AI, telecommunications, and biotechnology. The outcome of these negotiations could significantly impact the trade relationship between the two nations.