India, US expected to finalise interim trade deal by June 25: Report

With momentum building around India-US trade talks, an interim trade agreement between the two countries may be finalised by June 25, according to a PTI report.

"Talks are moving. Things are on track," PTI quoted people aware of the matter as saying, ahead of a planned visit by a team of US officials to India next month.

India’s chief negotiator, Rajesh Agrawal, Special Secretary in the Department of Commerce, concluded a four-day visit to Washington last week, during which he held discussions with his US counterpart on the contours of the proposed agreement.

Commerce and Industry Minister Piyush Goyal was also in Washington last week to give a fresh push to the talks. He met US Commerce Secretary Howard Lutnick twice during the visit.

Both sides are looking to strike an interim trade pact ahead of a bilateral trade agreement (BTA), especially as the United States’ 26% reciprocal tariff on Indian goods remains suspended until July 9.

A US delegation is expected in India in the coming weeks for the next round of discussions, reported PTI.

“Negotiations are moving at a faster pace,” PTI quoted a source as saying.

On April 2, the US imposed a 26% additional tariff on Indian goods but suspended it for 90 days. Indian exports, however, continue to face the standard 10% baseline US tariff.

India is pushing for full exemption from the 26% reciprocal duty in the interim deal.

Both sides have set a tentative deadline to conclude the first phase of the BTA by the fall (September-October) of 2025. While the US administration currently requires Congressional approval to reduce tariffs below the Most Favoured Nation (MFN) levels, it retains executive authority to revoke reciprocal duties applied to certain countries, including India.

Trade figures and outlook

The US retained its position as India’s largest trading partner for the fourth consecutive year in 2024-25, with bilateral trade valued at USD 131.84 billion. The US accounted for around 18% of India’s goods exports, 6.22% of imports, and 10.73% of total merchandise trade.

India posted a trade surplus of USD 41.18 billion with the US in 2024-25, up from USD 35.32 billion in 2023-24, USD 27.7 billion in 2022-23, USD 32.85 billion in 2021-22, and USD 22.73 billion in 2020-21. Washington has flagged concerns over the widening trade imbalance.

The two countries aim to double bilateral trade to USD 500 billion by 2030.

According to a finance ministry report, a successful BTA could shift existing headwinds into tailwinds, opening up new markets and spurring Indian exports.

Sectoral expectations

In the proposed trade deal, India is seeking duty relief for labour-intensive sectors such as textiles, gems and jewellery, leather goods, garments, plastics, chemicals, shrimp, oilseeds, grapes, and bananas.

The US, in turn, is pushing for lower Indian tariffs on items including certain industrial goods, automobiles (particularly electric vehicles), wines, petrochemical products, dairy, and select agricultural goods such as apples, tree nuts, and genetically modified (GM) crops.

While India's regulatory stance continues to bar GM crop imports, officials indicated openness to importing non-GM products such as alfalfa hay, a type of cattle feed.