India and US Trade Talks Making Strides, Says Minister

Minister Piyush Goyal expressed optimism about trade discussions with the US, highlighting progress made despite previous delays, indicating a potential resolution in the near future.

India's Commerce Minister Piyush Goyal recently announced that the country is making "fantastic progress" in its ongoing trade deal negotiations with the United States. His remarks came in London following the signing of a significant free trade agreement with the United Kingdom this past Thursday. Goyal's positive assessment is framed against a backdrop of missed deadlines between Washington and New Delhi for finalizing the trade deal, with US President Donald Trump imposing a deadline of August 1 for countries including India to establish agreements or face increased tariffs.

The tough measures trace back to Trump's announcement of a 26% tariff on Indian imports on April 2, which was originally suspended until July 9 but later extended to August 1. Indian officials have undertaken several trips to the US to negotiate the terms of the potential agreement.

Last week, Trump indicated a degree of optimism as well, stating that the two nations were "very close" to reaching an interim resolution. Goyal stated to Reuters, "I do hope we'll be able to conclude a very consequential partnership," embodying a confident outlook on the upcoming negotiations.

When queried about the challenges India faces, particularly concerning the tariffs on agricultural and dairy products, Goyal stressed that "negotiations happen in the negotiation room." He remains hopeful that India can still work toward a comprehensive trade deal even if smaller sector-specific agreements can be achieved first.

Goyal conveyed similar sentiments to Bloomberg, affirming his belief that an agreement would be reached before the impending deadline. However, several critical issues lingering from prior negotiations could still hinder progress. For years, the US has sought to gain expanded access to India's agricultural market, which it views as a significant untapped sector. Conversely, India has staunchly defended its agricultural framework, citing necessities for food security and the livelihoods of millions of small farmers.

Previously, the US held the title of India's largest trading partner, with bilateral commerce amounting to around $190 billion. Both Trump and India's Prime Minister Modi aim to significantly increase this figure, aspiring to achieve $500 billion in trade. India has already taken steps to lower tariffs on various imports such as motorcycles and Bourbon whiskey; however, the US still grapples with a substantial $45 billion trade deficit with India, a situation Trump is eager to rectify.