India’s External Affairs Minister S. Jaishankar announced that the country is engaged in intense trade discussions with the U.S., anticipating a bilateral trade agreement. The dialogue follows a meeting between Prime Minister Modi and President Trump, with negotiations to begin by fall 2025. Jaishankar emphasized the strong business case for the agreement despite tariff challenges and highlighted India’s ongoing efforts to establish trade pacts with other nations.
India and the U.S. are currently engaged in “very active” and “intense” discussions on trade, as stated by External Affairs Minister S. Jaishankar. These talks come as the world anticipates U.S. President Donald Trump’s upcoming reciprocal tariff set to take effect on April 2. Jaishankar emphasized the existence of a strong business case for a bilateral trade agreement (BTA) between the nations without revealing any immediate outcomes from the negotiations.
Following a recent meeting in Washington D.C. between Prime Minister Narendra Modi and President Trump, it was announced that negotiations for the first tranche of the BTA are expected to begin by fall 2025. Jaishankar noted, “There’s a very active and intense trade discussion going on at this point of time,” underscoring the ongoing diplomatic efforts. Brendan Lynch, the assistant U.S. trade representative for South and Central Asia, has started a five-day visit to India to further discussions.
Mr. Jaishankar hinted at the possibility of discussions regarding waivers for India as the new tariffs approach. He mentioned the productive dialogue regarding trade, mapping it back to the commitment made by Modi and Trump towards establishing a bilateral agreement this year. While acknowledging concerns regarding India’s protected agricultural market, he suggested such issues should not block progress, as there remains a compelling business case for the BTA.
Additionally, Jaishankar revealed that India is in talks regarding separate free trade agreements with the European Union and the United Kingdom, noting these negotiations are serious and advanced. In terms of the defense relationship, he indicated expectations for a “more substantial” partnership with the U.S. under the Trump administration, which is perceived as more willing to share American technologies.
The External Affairs Minister also emphasized the importance of enhancing energy ties with the U.S., ensuring that India has a stable and diverse energy supply to support long-term growth. Notably, India has a history of importing LNG from the U.S., and there is an expressed interest in increasing these imports due to the stability of the U.S. as a supplier.
On assessing Trump’s policies, Jaishankar stated, “Overall, our assessment was that we saw many changes which suited us or which in some way formed convergence on which we could build upon.” The current tariff policies have raised concerns over a potential global trade war, alongside measures by various nations to address the economic implications.
In alignment with the “America First” policy, Trump introduced reciprocal tariffs affecting countries imposing higher tariffs on U.S. imports, which includes India. India has made recent strides in reducing tariffs for developed nations as part of bilateral agreements, further highlighting the context of ongoing discussions with the U.S.
The Indian government’s recent budgetary decisions for 2025-26 included reducing tariffs on specific sectors such as Bourbon whiskey and electronic vehicles to signal openness to negotiation. The U.S. is advocating for increased purchases of American oil, gas, and military platforms to mitigate the trade deficit, which currently stands at $45 billion in India’s favor. For 2023, the U.S. emerged as India’s largest trading partner, with bilateral trade reaching $190 billion. Furthermore, it accounts for approximately $4.99 billion of the foreign direct investment in India for the fiscal year 2023-24, representing a notable share of total equity inflows.
The discussions between India and the U.S. about trade reflect a crucial period for economic diplomacy, as both countries aim for a bilateral trade agreement. Jaishankar’s remarks highlight a positive outlook for negotiations amid unfolding tariff changes and underscore the ongoing commitment to expand trade relations. India’s trade strategy includes negotiations with both the U.S. and other global partners, aiming for economic growth in a complex international trade landscape.
Original Source: www.thehindu.com
