16th April 2025 (8 Topics)
1
Apr
2
Apr
3
Apr
4
Apr
5
Apr
7
Apr
8
Apr
9
Apr
10
Apr
11
Apr
12
Apr
14
Apr
15
Apr
16
Apr
India–US Trade Talks
Context
India and the US signed the “Terms of Reference” for the initial phase of a new trade deal. This means they’ve agreed on a basic roadmap for talks. The aim is to finalise the first phase by the end of 2025 with a view to reaching bilateral trade worth USD 500 billion by 2030.
What is in the Agreement?
- India and the US signed the “Terms of Reference” for the initial phase of a new trade deal.
- This means they’ve agreed on a basic roadmap for talks.
- The aim is to finalise the first phase by the end of 2025.
- Goal: Both sides want to boost bilateral trade to USD 500 billion by 2030.
(Current India–US trade is around USD 190–200 billion.) - India has officially chosen the path of “trade liberalisation” with the US.
- This implies India is willing to reduce tariffs, open markets, and improve regulatory coordination, but in a phased and careful manner.
- The first round of virtual discussions is scheduled this month (April), and in-person talks are planned for mid-May 2025.
Trade Friction
- India and the United States are strategic partners in areas like defence, energy, Indo-Pacific cooperation, and technology.
- However, on trade issues, relations have frequently faced tensions.
- Key issues over the past few years:
- The US has a trade deficit with India (currently around USD 45.6 billion).
- Former President Trump has often referred to India as the "tariff king", claiming Indian duties on American goods are unfair.
- The US removed India from GSP (Generalised System of Preferences) in 2019, ending tariff-free access for many Indian exports.
- Tariffs were imposed on Indian goods like steel, aluminium, and agricultural products.
- Despite repeated negotiations, a comprehensive trade deal was never finalised in Trump’s first term.
What This Means for India–US Relations?
- This trade engagement offers a fresh opportunity to rebuild economic ties.
- India is trying to:
- Resolve long-standing tariff disputes
- Retain its strategic autonomy
- Ensure fair and balanced access for its exporters
- The trade talks are also important because:
- They can prevent further economic friction under Trump’s protectionist policies.
- A successful deal would strengthen the overall strategic relationship, including cooperation in the Quad and Indo-Pacific.
More Articles
Courses
Study
Notes
Home
Resources
More
