As over 75 countries rush to secure trade deals with the United States during its 90-day pause window to avoid reciprocal tariffs, India is strategically positioning itself to bridge the trade gap with Washington by replacing third-country imports, a senior Indian government official has confirmed.
Key Points:
- Virtual discussions between India and the US are beginning this week.
- A broad framework for duty concessions is expected to be outlined by end of May.
- A Bilateral Trade Agreement (BTA) is targeted for Fall 2025, though an interim deal could be signed earlier if significant progress is made within the 90-day window.
India’s Strategic Leverage
The official noted that while countries like Vietnam may benefit from concessions under separate US deals, India is uniquely positioned due to:
- Its ability to absorb more US imports, replacing other nations’ goods.
- Potential to increase exports to the US, helping bring bilateral trade to $500 billion.
“Replacing imports from other countries with US goods is not a difficult proposition. That could be one of the outcomes of the BTA,” the official emphasized.
The US has flagged tariffs and trade deficits in its talks with India, while raising subsidies and currency manipulation concerns with other nations. India believes it can narrow the deficit while still securing preferential access to US markets.
Goyal: “No Negotiation Under Pressure”
Commerce Minister Piyush Goyal firmly stated on Friday:
“India will not negotiate with a gun to its head… Our national interest remains paramount.”
Goyal’s stance reinforces India’s intention to prioritize substance over speed, despite pressure to meet the 90-day deadline.
Positive Outlook from Washington
The senior official also highlighted:
- Encouraging signals from US Treasury Secretary and USTR (United States Trade Representative).
- Acknowledgment that some rule-based aspects of the deal will extend beyond six months.
- Assurance that the agreement will be WTO-compliant, amid criticism of US trade moves under Trump.
What’s Next?
In the coming weeks:
- Negotiating teams will identify mutually acceptable tariff reductions.
- Sensitive sectors such as agriculture, digital trade, and market access will be examined closely.
- Stakeholder feedback from both sides will shape the final contours of the BTA.
