India seeks to deepen trade ties with US by reducing tariff barriers via bilateral trade deal

India seeks to deepen trade ties with the US by reducing tariff and non-tariff barriers through a bilateral trade deal. The development comes days after US President Donald Trump announced reciprocal tariffs on trading partners. 

In line with his "America First" policy, Trump announced reciprocal tariffs on numerous trading partners and nations that impose higher levies on imports from the US starting April 2. According to PTI, the Indian government indicated in its first reaction that it expects an amicable resolution to the issue.

Also Read: US-China trade war 2.0: How does it impact India?

India-US Trade Deal

External Affairs Ministry spokesperson Randhir Jaiswal said that during Prime Minister Narendra Modi's visit to the US last month, both sides announced plans to negotiate a mutually beneficial, multi-sector Bilateral Trade Agreement (BTA). Commerce Minister Piyush Goyal was in the US and met his counterparts in the US government. Goyal said the two governments are advancing discussions on a multi-sector bilateral trade pact.

“Our objective through the BTA is to strengthen and deepen India-US two-way trade across the goods and services sector, increase market access, reduce tariff and non-tariff barriers, and deepen the supply chain integration between the two countries,” added Piyush Goyal. The MEA spokesperson said the discussions are centred on boosting two-way trade in goods and services.

Also Read: How India is buckling up for US tariff as Donald Trump calls it ‘very high tariff nation’

Trump tariffs

US President Donald Trump has been relentless in his pursuit of a tariff overhaul ever since assuming office in January. After making Mexico, China, and Canada his first victims (even though he paused some of the moves for a limited time), and threatening 25 per cent tariffs on all steel and aluminium imports, he then announced his intention to introduce reciprocal tariffs on US’s imports from other countries, including China, India. 

Piyush Goyal’s delegation in Washington is seeking a balance between securing favourable trade terms and protecting domestic industries. The US, set to announce new tariffs on Indian goods by March 12, sees energy and petrochemicals as key components of future trade. Meanwhile, India, a growing petrochemical consumer, wants to ensure its industries—plastics, textiles, and pharmaceuticals—do not rely on imports but also create value at home. 

Also Read: Assessment of reciprocal tariff hinges on India-US trade talks: FM