India and the United States are set to initiate sector-specific discussions under their proposed Bilateral Trade Agreement (BTA) in the coming weeks, aiming to boost trade and investment ties. The decision follows four days of negotiations between senior officials from both nations, concluded on Saturday.

According to the Commerce Ministry, expert-level engagements will begin virtually and lay the groundwork for an in-person negotiating round. The goal is to finalize the initial phase of the BTA by fall 2025.

Focus on Market Access & Supply Chain Integration

The recent talks emphasized expanding market access, reducing tariff and non-tariff barriers, and deepening supply chain integration in key sectors. A US delegation, led by Assistant US Trade Representative for South and Central Asia, Brendan Lynch, participated in the discussions.

This meeting builds on Commerce and Industry Minister Piyush Goyal’s visit to Washington from March 4-6, where he held talks with US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick.

Economic Growth & Trade Expansion

The India-US trade partnership has grown significantly, with bilateral trade exceeding $190 billion. The two nations have set an ambitious target of $500 billion by 2030.

The US is advocating duty concessions for certain industrial goods, automobiles, wines, petrochemicals, and agricultural products like apples and tree nuts. India, in turn, is likely to seek duty cuts on labor-intensive sectors such as textiles.

However, agricultural trade remains a sensitive issue. Experts suggest that India may resist opening its dairy and agriculture sectors, given their political and economic significance.

India’s Trade and Investment Relations with the US

The US remains India’s largest trading partner. In 2023-24, bilateral trade in goods stood at $119.71 billion, with India enjoying a $35.31 billion trade surplus.

Key Exports from India to the US (2024):

Pharmaceuticals – $8.1 billion

Telecom instruments – $6.5 billion

Precious and semi-precious stones – $5.3 billion

Petroleum products – $4.1 billion

Jewelry – $3.2 billion

Cotton garments – $2.8 billion

Iron & steel products – $2.7 billion

Key Imports from the US (2024):

Crude oil – $4.5 billion

Petroleum products – $3.6 billion

Coal & coke – $3.4 billion

Cut & polished diamonds – $2.6 billion

Electric machinery – $1.4 billion

Aircraft & parts – $1.3 billion

Gold – $1.3 billion

The US has also been a major investor in India, with $67.8 billion in Foreign Direct Investment (FDI) from April 2000 to September 2024.

Looking Ahead

Both India and the US have expressed satisfaction with the progress made and reaffirmed their commitment to strengthening economic cooperation. The upcoming negotiations aim to unlock new business opportunities and further integrate the two economies.

With key trade policies under discussion, all eyes will be on the upcoming negotiations to shape the future of India-US trade relations.