Trade negotiations with the US are expected to conclude this year, says Economic Survey of 2025-26

The recently tabled economic survey of 2026 touched several points which affect the economic well being of the nation. Out of which the most crucial aspect remains on the external headwinds the economy is facing by way of tariffs. India and European Union recently concluded a FTA (free trade agreement), which is expected to bolster the trade relations between two crucial economic partners. After EU, the only looming question remains on the India-US trade deal, which one of the significant anchor holding back the resurgence of Indian economy in the global trade.

India currently is subjected to 50% tariffs on the US exports and also highest amongst major trading partners of the US. The tariffs have had wider impact on the economy by sharp decline in exports from Gems & Jewellery, marine, auto components and other products.

While commenting on the impact of tariffs, the survey highlighted that the negotiations are expected to conclude sooner than later. The report said that ongoing negotiations for a trade agreement with the US are expected to conclude during the year, a development that could help reduce uncertainty on the external front, according to Economic Survey 2025-26.

For India, it said, the global conditions translate into external uncertainties rather than immediate macroeconomic stress.

Slower growth in key trading partners, tariff-induced disruptions to trade and volatility in capital flows could intermittently weigh on exports and investor sentiment, the Survey said.

"At the same time, ongoing trade negotiations with the United States are expected to conclude during the year, which could help reduce uncertainty on the external front," it said.

India and the US are negotiating a bilateral trade agreement since March last year. So far, six rounds of negotiations have been held. Talks are going slow as the Trump-administration has imposed a steep 50 per cent tariffs on Indian goods from August last year.

A delegation from the office of the US Trade Representative, led by Deputy US Trade Representative Ambassador Rick Switzer, was here in December 2025 for trade talks.

The visit of US officials marks their second trip since the imposition of a 25 per cent tariff and an additional 25 per cent penalty on Indian goods entering the American market due to the purchase of Russian crude oil.