India and the United States are reportedly in the final stages of negotiating a long-awaited trade agreement that could slash US tariffs on Indian goods from as high as 50% to around 15–16%, according to a report by Mint.
The proposed pact places particular emphasis on the energy and agriculture sectors, two areas that have remained sticking points in past negotiations.
Officials familiar with the talks said both sides are working to finalise the agreement before the ASEAN Summit later this month, where a formal announcement could be made.
Focus on Energy and Agriculture
The upcoming deal is expected to strengthen cooperation in energy and agriculture, areas that have been central to bilateral trade discussions.
The Mint quoted sources who said that as part of the pact, India may allow greater imports of US agricultural products, including non-genetically modified corn and soymeal. This move could ease long-standing US concerns about India’s highly protected agricultural market.
“The agreement may also include a mechanism for periodic tariff and market access reviews to ensure balanced trade,” the report noted.
ALSO READ: Saudi Arabia abolishes Kafala system | What is it
In return, the US is expected to reduce import tariffs on Indian goods significantly, making Indian exports — including textiles, engineering goods, and pharmaceuticals — more competitive in the American market.
Leaders Hold Talks Ahead of Deal
The progress follows a phone conversation between US President Donald Trump and Indian Prime Minister Narendra Modi earlier this week. Trump told reporters that their discussion focused on trade and energy cooperation.
“Energy was also part of our discussion, and Prime Minister Modi assured me that India would limit its oil purchases from Russia,” Trump said.
Modi acknowledged the call on X (formerly Twitter), writing: “Thank you, President Trump, for your phone call and warm Diwali greetings. On this festival of lights, may our two great democracies continue to illuminate the world with hope and stand united against terrorism in all its forms.”
While Modi did not disclose further details, the exchange signals a renewed momentum in trade talks.
Tariff Reduction Could Boost Indian Exports
If concluded, this deal would be the biggest breakthrough in India-US trade relations since 2020, when talks stalled over tariff disagreements.
The US is one of India’s largest trading partners, with bilateral trade crossing $200 billion in recent years. Analysts believe tariff cuts could boost Indian exports while giving US companies greater access to India’s growing consumer market.
However, the condition involving reduced Russian oil imports may present a geopolitical challenge for India, which has relied on Russia for discounted crude.
The agreement is expected to be finalised ahead of the ASEAN Summit, which could serve as a platform for leaders to make a joint announcement.
