Daijiworld Media Network – Washington
Washington, May 22: In a major step towards strengthening bilateral trade ties, India and the United States are poised to announce an early harvest trade deal by next month, aimed at boosting market access for goods on both sides and diffusing looming tariff tensions.
Officials privy to the negotiations said the agreement would address tariff and non-tariff barriers on a wide range of goods including agricultural produce, while safeguarding sensitive sectors through quota restrictions and a negative list.
The early-stage pact, focusing on low-hanging fruits like automobiles and farm products, comes as part of a broader effort to finalize a comprehensive Bilateral Trade Agreement (BTA) by September-October 2025, as jointly proposed by Prime Minister Narendra Modi and US President Donald Trump during their February summit in Washington.
Under the initial deal, India is expected to slash tariffs on select US agricultural items such as maize, almonds, soyabean, pistachio, poultry, and meat, but will maintain restrictions on genetically modified (GM) foods, officials clarified.
In return, the US is likely to withdraw the 10% baseline tariff currently applied to Indian goods and halt plans for a 16% India-specific additional tariff set to take effect from July 9, thus averting a potential trade row.
The US is also expected to provide greater access to Indian labour-intensive exports such as textiles, gems, and jewellery, and ease non-tariff restrictions.
Commerce Minister Piyush Goyal, currently on a week-long US visit, has been leading the Indian side’s efforts. On Tuesday, he held crucial discussions with US Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer. Goyal hinted at positive progress in a post on X, saying, “Good discussions with Secretary @HowardLutnick towards expediting the first tranche of India-US Bilateral Trade Agreement.”
Chief negotiators Brendan Lynch for the US and Rajesh Agrawal, India’s commerce secretary-designate, are currently concluding a fresh round of intense negotiations, expected to wrap up on Thursday.
Sources said both sides have reached near consensus on granting duty-free access to over 90% of goods, contingent upon Washington granting preferential treatment to Indian exports by eliminating non-tariff hurdles.
The proposed deal is seen as a strategic move to deepen economic cooperation while heading off a new round of retaliatory tariffs that could hamper trade valued at billions of dollars.