India and US to Strengthen Trade Relations

In a significant move to bolster bilateral trade, India and the United States have agreed to hold sector-specific talks aimed at finalizing a comprehensive trade agreement. This initiative follows extensive discussions between senior officials from both nations, signaling a mutual commitment to enhancing economic ties.

Key Objectives of the Trade Pact

The proposed bilateral trade agreement (BTA) seeks to increase market access for goods, reduce tariff and non-tariff barriers, and enhance supply chain integration between the two countries. With ambitions to more than double bilateral trade to USD 500 billion by 2030, the pact represents a pivotal step towards achieving shared goals of prosperity and resilience.

Upcoming Negotiations and Challenges

Expert-level engagements are set to commence virtually, paving the way for in-person negotiations. However, challenges remain, including the US's demand for duty concessions in sectors like industrial goods and agriculture, and India's focus on labor-intensive sectors such as textiles. The political sensitivity around dairy and agriculture in India adds complexity to the discussions.

Implications for Indian Exporters

Indian exporters express concerns over potential reciprocal tariffs by the US, which could impact key sectors. The US is India's largest trading partner, with bilateral trade in goods reaching USD 119.71 billion in 2023-24. The outcome of these talks is crucial for maintaining and expanding this vital economic relationship.