India eyes multi-phase trade deal with US, interim pact likely before July

Business Standard

20-05-2025

The talks are still ongoing and there's no clarity if the Trump administration has agreed to a three-stage process for a trade deal
Bloomberg
By Shruti Srivastava and Sudhi Ranjan Sen
India is discussing a US trade deal structured in three tranches and expects to reach an interim agreement before July, when President Donald Trump 's reciprocal tariffs are set to kick in, according to officials in New Delhi familiar with the matter.
The interim deal will likely cover areas including market access for industrial goods, some farm products and addressing some non-tariff barriers, such as quality control requirements, the people said, asking not to be identified because the discussions are private.
The talks are still ongoing and there's no clarity if the Trump administration has agreed to a three-stage process for a trade deal. India's Commerce Minister Piyush Goyal is currently in Washington on a four-day trip that ends Tuesday, where he's expected to meet US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick to advance the negotiations.
India's Ministry of Commerce and Industry and Ministry of External Affairs didn't immediately respond to requests for further information. The USTR and Commerce Department also didn't immediately respond to questions.
The second stage of an India-US deal may be a broader and more detailed agreement timed for around September to November, Indian officials familiar with the matter said, likely covering the 19 areas outlined in the terms of reference agreed by the two sides in April. The timing for this part of the deal may be aligned with an expected visit by Trump to India for the Quad leaders' summit, one of the people said.
The final leg of the deal will likely be a comprehensive agreement that would follow once there's approval from the US Congress, possibly concluded only next year, Indian officials familiar with the matter said.
India was one of the first countries to begin trade negotiations with the US following Prime Minister Narendra Modi's visit to the White House in February shortly after Trump took office. Both leaders agreed to boost trade and work toward concluding the first tranche of the bilateral deal by fall of this year. Since then, New Delhi has signaled the possibility of 'early mutual wins' before the fall deadline.
While Indian officials say talks remain on track, there have been signs of tension in recent days. New Delhi appears to be adopting a tougher stance in negotiations, threatening retaliatory tariffs on US goods last week. Trump has also claimed that India offered to slash tariffs on US goods to zero, while downplaying any sense of urgency to reach a trade deal.
The US leader's comments about his involvement in negotiating a ceasefire between India and Pakistan have also been a source of frustration in New Delhi. Trump has repeatedly said he used trade as a bargaining tool to secure a truce between India and Pakistan after four days of military conflict that had brought the two South Asian rivals close to an all-out war. Indian officials have denied Trump's assertions.