India and the United States have agreed to hold sector-specific discussions in the coming weeks to finalise the structure of a proposed Bilateral Trade Agreement (BTA).

This decision follows four days of negotiations between senior officials from both nations, concluding on March 29, 2025. The talks aim to promote economic growth by increasing market access, reducing tariff and non-tariff barriers, and deepening supply chain integration.

Both sides are targeting to finalize the first phase of the agreement by fall 2025 and aim to more than double bilateral trade to $500 billion by 2030 from the current $190 billion.

The U.S. delegation, led by Assistant U.S. Trade Representative Brendan Lynch, has pushed for concessions in sectors such as industrial goods, automobiles, wines, petrochemical products, dairy, and agriculture.

India and the United States have been actively engaging in trade negotiations, focusing on deepening bilateral cooperation while addressing sensitive sectors like agriculture and dairy. Despite the U.S.'s push to include agriculture in a comprehensive trade agreement, experts believe India is unlikely to open its dairy and agricultural sectors due to their political sensitivity and the reliance of over 50% of its population on agriculture for livelihoods. This stance reflects India's protective approach toward tariffs on staple crops, dairy, and farm products crucial for rural sustenance.

In 2024, U.S. agricultural exports to India totalled $1.6 billion, with key products including almonds ($868 million), pistachios ($121 million), apples ($21 million), and ethanol ($266 million). India had previously removed retaliatory tariffs on eight U.S. products in 2023, signalling efforts to smooth trade relations. On the other hand, India's major exports to the U.S. included drug formulations ($8.1 billion), telecom instruments ($6.5 billion), and precious stones ($5.3 billion), among others, while imports featured crude oil ($4.5 billion), coal ($3.4 billion), and electric machinery ($1.4 billion).

The U.S.-India bilateral trade reached $119.71 billion in 2023-24, making the U.S. India's largest trading partner with a $35.31 billion trade surplus in goods. Furthermore, America has invested $67.8 billion in India between April 2000 and September 2024. Negotiations under the proposed Bilateral Trade Agreement (BTA) aim to increase market access, reduce tariff barriers, and deepen supply chain integration, with a target to double bilateral trade to $500 billion by 2030. The first phase of this agreement is expected by fall 2025.

The negotiations occur amidst U.S. threats to impose reciprocal tariffs on key trading partners, including India, starting April 2.

Indian exporters have requested exemptions from these tariffs as they could severely impact trade with the U.S., India's largest trading partner.

Both nations are committed to ensuring that the agreement aligns with shared goals of prosperity and resilience while addressing fairness and national security concerns.

Agencies