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The Hindu
02-07-2025
- Business
- The Hindu
U.S.-India ‘mini deal' by July 9 possible but likely ‘symbolic,' say industry leaders
While a mini trade deal between India and the US still seems possible before July 9, such a deal would likely be a 'symbolic one' centred on 'low-hanging fruits', according to industry captains. Such a deal, they added, would be a small beginning in a long journey for the world's largest democracies. According to Atul Keshap, former Ambassador and President of U.S.-India Business Council (USIBC), a business advocacy group that represents companies in the U.S, India, and the Pacific region, a mini trade deal would be a first step in the two countries' longer journey toward achieving the 'Mission 500' target of $500 billion in bilateral trade by 2030. 'There is great promise in building deeper energy and technology ties, in electronics and IT, which will remain strong pillars of our bilateral trade,'' Mr. Keshap told The Hindu. He further said that clinching an initial agreement would reaffirm the steadfast partnership between the two governments and show both parties were committed to trade as a tool for enhancing economic progress and building new commercial opportunities. Responding to a query on what could prove to be key sticking points, Mr. Keshap said, 'The more trade between two countries, the higher the chances for disagreements over trade policy. In the end, we need a deal that enables the private sectors of both countries to deliver on the promise of free enterprise and entrepreneurship.'' He further said, USIBC believed that there was great promise in building deeper energy and technology ties, in electronics and IT, which would remain strong pillars of our bilateral trade. 'It is very important that both governments discuss and deliberate on what can increase bilateral trade between the two countries,'' he opined. Kami Viswanathan, President of Middle East, Indian Subcontinent and Africa (MEISA), FedEx, also said she was hopeful of seeing a mini deal out by the expected time. 'It's due for some time now, and I hope it comes soon. I hope there will be something happening within the timeline itself. That will do good to businesses, trade, and to both countries,'' she anticipated. Kumar Deep, Country Director-India, Information Technology Industry Council, a Washington DC-based apex body for global tech firms, thought that, 'There is an ever-changing geopolitical situation. We are not sure as to what is going to come out by July 9, will there be a formal trade announcement by that time or not. But it is heartening to see that both governments are closely engaged in having some concrete trade negotiations. That is very positive and earlier we have not seen these energies working towards improving relationships.'' According to Mr. Deep, in the last three months, there have been several delegations visiting New Delhi and Washington. It is a complex deal and the design has to be right for both governments, businesses in both countries and their people, he commented. Shashi Shekhar Vempati, former Chief Executive Officer of Prasar Bharati (DD&AIR) and co-founder of DataDaan, a nationwide programme designed to promote voluntary data sharing for AI model training and innovation, said the fundamentals of both countries were so robust, and historically India and the U.S have been together in many ways. ``It is only a logical extension that we deepen our ties across technology, supply chain and many other areas and minimise barriers. Things are now looking very positive.'' Pradeep Rao, Director and Chief Architect at Kyndryl, a spin-off from IBM, in his individual capacity said, 'A mini deal by July 9, I do think it's technically feasible, especially if it focuses on low-hanging fruit in the technology and digital trade sectors.'' The timeline, however, was indeed tight, and the deal would likely be symbolic, maybe paving the way for a broader framework, he opined. Given the strategic importance of the Indo-U.S. tech corridor — covering everything from AI to semiconductors to cybersecurity — both governments have strong incentives to showcase some tangible progress, said Mr. Rao. The U.S. Chamber has argued against the application of broad-based tariffs, Mr. Keshap said. 'Tariffs are a tax, paid by domestic businesses and consumers, and they undermine growth and productivity.'' The USIBC was also discussing joint investments, co-development of technologies, institutionalising reforms, and building a two-way investment corridor supporting Indian investments in the United States and U.S. investments in India, he said. According to Mr. Rao, American businesses are indeed protesting the tariffs, particularly in the tech and digital hardware sectors. US companies, from cloud service providers to chipmakers, see India as a fast-growing market and R&D hub, but high tariffs on electronics, semiconductors, and ICT infrastructure hurt their competitiveness. ''Nobody likes tariffs in the U.S, everybody wants a bunch of good trade deals and negotiations. We have been vouching for open market access and a level playing field for all our member companies. There could be all kinds of models, in-sourcing, onshoring, or outsourcing, eventually it should make business sense to all,'' said Mr. Deep.
Hindustan Times
02-07-2025
- Business
- Hindustan Times
As India-US trade talks enter final stage, all possibilities still on table
With just a week to go before the retaliatory tariff of 16% on imports from India to the US kick in, all possibilities remain according to officials familiar with the matter: no deal, with sensitive issues such as US exports of dairy products and agricultural produce, scuttling one; an early deal with both countries dropping sensitive items from the contours of an agreement; and, while the probability of one is low, a big trade deal, as US President Donald Trump had said time and again. At present India and the US are negotiating an early harvest deal of the BTA and expected to arrive at some tangible outcomes before July 9.(AFP File) The first eventuality could see the tariffs kick in (on top of 10% that came into effect in April); while the second and third could help Indian exports to the US escape them. To be sure, the people clarified, the first would not affect the larger deal that is being discussed. Negotiators of India and the US continued to talk for the sixth day in Washington to converge on a common ground with the American side showing signs of easing some of its punitive tariffs to gain duty-free access to non-sensitive Indian agriculture market, the people cited above added, requesting anonymity. 'Current negotiations are focused on an interim deal with low-hanging fruits as a first approach. Both could drop sensitive items such as dairy products and GM crops concerning India, and electronics for America, to conclude an early deal. Other items could be taken up in the next rounds when negotiations for the first tranche of a comprehensive bilateral trade agreement (BTA) would start,' one of them said. The ambitious 19-chapter BTA is not just about tariffs alone, he added. 'It involves goods, services and investments, besides present and future strategic cooperation between the two nations.' At present India and the US are negotiating an early harvest deal of the BTA through a fast-track mechanism and expected to arrive at some tangible outcomes before July 9. On February 13, Prime Minister Narendra Modi and President Trump resolved to deepen the US-India trade relationship to promote growth that ensures fairness, national security and job creation, leading to boost total bilateral trade to $500 billion by 2030 (Mission 500). In order to achieve that they decided to negotiate the first tranche of a 'mutually beneficial, multi-sector BTA by October this year. Before the first tranche, the two partners have decided to forge a mini deal to ease punitive 'Liberation Day' tariffs announced by the Trump administration on April 2, the first person said. Currently, the Indian negotiating team, led by special secretary-commerce Rajesh Agrawal, is camping in Washington from June 26 for the same. The team was originally expected to return in two days. 'If the proposed trade talks fail, the 26% tariffs (10% existing plus 16% impending) will come into force from July 9,' a second person, a government official, said. The failure of the initial harvest deal would, however, not derail the talks for the first tranche of BTA by October 2025, the first person clarified, adding that 'efforts are on for a win-win deal that would give market access to most American products and ease tariff barriers for Indian goods'.
Hans India
01-07-2025
- Business
- Hans India
India, US may sign interim trade agreement this week: Report
New Delhi: India is on course to finalise an interim trade agreement with the US as early as this week to escape the tariff hike on its exports proposed by President Donald Trump, according to a report in the Financial Times. India's negotiating team, led by Special Secretary Rajesh Agarwal, is engaged in high-level talks in Washington to conclude the bilateral trade agreement. External Affairs Minister S Jaishankar is expected to hold one-on-one talks with his US counterpart Marco Rubio on Tuesday or Wednesday on the sidelines of a meeting in Washington, the report stated. The interim trade deal would be an initial step towards a comprehensive bilateral free trade agreement between Indian and the US. Indian and US negotiators are aiming to finalise an interim trade deal ahead of the July 9 deadline that has been fixed by US President Donald Trump for the 90-day pause on new tariffs that were to be levied on Indian products. Negotiations are expected to continue after that for a bigger trade deal to be signed in September-October. The US is seeking broader market access for its agricultural and dairy products, but for India, this is a livelihood issue for the country's small farmers and hence is considered a sensitive area. India may allow the import of select agricultural products, such as almonds, as these are already flowing into the country. However, as a quid pro quo, India is likely to press for improved access to the US market for seafood products like shrimp and fish, as well as spices, coffee, and rubber- segments where Indian exporters are globally competitive but face tariff competition in the American market. India has already started buying more oil and gas from the US to reduce the trade surplus and has offered to increase these purchases. India has proposed significant tariff reductions, potentially lowering average duties from 13 per cent to 4 per cent, in exchange for exemptions from US tariff hikes imposed during the Trump administration. These concessions are on the same lines as those offered in the recent bilateral free trade agreement that India has signed with the United Kingdom. India is seeking market access for its industrial products such as steel, aluminium, auto components and pharmaceutical goods. Recently, the US doubled safeguard duties on steel and aluminium imports to 50 per cent, which has adversely impacted India's exports. Although India has moved the WTO with the issue, it is hoping to settle the issue through the bilateral trade agreement. Trade between India and the US touched the $129 billion mark in 2024, with New Delhi recording a trade surplus of $45.7 billion. In February, Prime Minister Narendra Modi and Trump launched 'Mission 500', an initiative aiming to double bilateral trade to $500 billion by 2030. The joint decision was announced during PM Modi's visit to Washington.
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Business Standard
05-06-2025
- Business
- Business Standard
US delegation in India to discuss trade pact: What will be on agenda?
A high-level US delegation visits New Delhi to advance bilateral trade negotiations, focusing on tariff reductions, market access, and resolving disputes ahead of July 9 deadline Krishnanshu Panda New Delhi A high-level US trade delegation is in New Delhi on June 5–6 to advance negotiations on a Bilateral Trade Agreement (BTA) with India. The visit follows Union Commerce Minister Piyush Goyal's recent trip to Washington and aims to finalise an interim trade deal by July 9, the deadline set by US President Donald Trump following a 90-day pause on new tariffs. What is India seeking? India has proposed significant tariff reductions, potentially lowering average duties from 13 per cent to 4 per cent, in exchange for exemptions from US tariff hikes imposed during the Trump administration. These concessions mirror those offered to the United Kingdom in a recent free trade agreement. India is also seeking preferential market access for its industrial and agricultural products in the US market. Dairy sector remains a sensitive issue The US, whose dairy exports reached $8.22 billion last year, is pushing for greater access to India's dairy market, which is currently protected by high import duties and non-tariff barriers. India's dairy industry, comprising over 80 million small-scale farmers, has expressed concerns over potential market disruptions from increased US imports, according to a Reuters report. Cultural and dietary considerations, such as the vegetarian feed requirement for dairy cattle, further complicate negotiations. Steel and aluminium tariffs: A point of contention Recently, the US doubled safeguard duties on steel and aluminium imports to 50 per cent, affecting Indian exporters. India is considering three options in response: imposing retaliatory tariffs, initiating a dispute at the World Trade Organization (WTO), or continuing bilateral discussions to reach a resolution. The US maintains that these tariffs are national security measures under Section 232, not safeguard actions, a position India disputes. Mission 500: Doubling bilateral trade by 2030 Trade between India and the US reached $129 billion in 2024, with New Delhi recording a trade surplus of $45.7 billion. In February, Prime Minister Narendra Modi and Trump launched 'Mission 500', an initiative aiming to double bilateral trade to $500 billion by 2030. Both nations are working diligently to finalise the first phase of the BTA by July 9, with further negotiations expected to continue through September.
NDTV
03-06-2025
- Business
- NDTV
As India, US Close In On Mega Trade Deal, A Look At Its Immediate Impact
Quick Read Summary is AI generated, newsroom reviewed. India and the US are nearing a trade agreement aimed at boosting bilateral trade significantly. Current annual trade is valued at $190 billion, targeted to reach $500 billion by 2030. American products may become more affordable for Indian consumers due to expected duty cuts. New Delhi: India and the United States are on a cusp of an agreement that will reshape commerce between the two largest democracies in the world. Negotiations for the pact, that are at an advanced stage, aim to take the annual bilateral trade between the two countries from the current $190 billion to a massive $500 billion by 2030 - and hence aptly titled 'Mission 500'. After his recent meeting with India's trade minister Piyush Goyal, US commerce secretary Howard Lutnick said "India has one of the most extraordinary economies". "The key that makes an extraordinary economy is the determination of the people. How much do your people care about being in business? How entrepreneurial are they? How much do they drive to be better for their families?" he said, adding that "From what I know about India, the core population of India has that drive and ambition, and that's why the Indian economy will always continue to grow and thrive because it has that from the underpinning and so you can do things in India that many other countries, you just can't get done." CLOSE TO A DEAL He went on to say that India and the United States are close to finalising a trade pact. "I think to be in a very, very good place, you should expect a deal between the United States and India in the not-too-distant future because I think we found a place that really works for both countries." His comments - that a deal is on the anvil is indicative of the rapid progress the two countries have made in negotiations that witnessed many roadblocks, including punitive reciprocal tariffs imposed by President Trump. Though it has been many years in the making, the deal could prove to be a game changer for India. Several sectors like pharmaceuticals and agriculture which have high exposure in the US market are set to be impacted significantly. Experts believe there is a significant upside for India's agricultural exports, which are currently valued at $4 billion. 'MISSION 500' 'Mission 500' is being viewed by stakeholders as more than just a trade pact. It is being seen as a vision for greater bilateral investment in both countries, as policymakers streamline processes allowing for easier movement of capital. Greater flow of capital and investments, coupled with higher access to American markets will create important avenues of growth for Indian businesses. While goods from sectors like engineering - which is one of the largest in terms of export to the US - will benefit, the true potential for growth lies in labour intensive sectors like footwear, garments, textiles, and electronics that will act as a catalyst for broad-based growth. IMMEDIATE IMPACT For Indian consumers, the pact will allow American products including high-end fashion brands to become more affordable. Duty cuts are likely to make several American FMCG or fast-moving consumer goods cheaper as well. This includes dairy products from brands like Danone and Land O'Lakes. The US alcobev industry will also gain significantly, with Bourbon whiskey brands like Jack Daniels and Jim Beam seeing a drop in prices in the Indian market. Once the deal fructifies, it will likely lead to greater opportunities for India and the US to align with global supply chains. More so since China tariffs remain high, affecting investor sentiment and global businesses. While the broad outlook for the trade pact remains positive, for Indian policymakers twin concerns remain. Free flow of labour and data remains a challenge due to the divergent views of New Delhi and Washington partly because of the present political climate in America. After concluding a crucial trade pact with the UK, India is now giving priority to having trade agreements with both the US and the European Union - the two largest trading partners for New Delhi. Speaking about this, trade minister Piyush Goyal said last week that "We are well on track in our bilateral trade agreement with the US and making fast progress with EU." India's economic forecast has said that a successful trade pact with the US will "turn the current headwinds into tailwinds".
