The first tranche of the India-United States bilateral trade deal is near closure, government sources told NDTV Profit on Monday.
"The trade deal has two parts, one part will take its own time, other part is the first tranche which can address all kinds of tariffs. We remain engaged, the discussions are on and part of agreement that covers reciprocal tariffs should happen sooner rather than later," an official said. The source declined to place a deadline for the agreement.
The two countries have publicly announced their intent to sign a deal by the end of this year.
Washington imposed a 50% tariff on most Indian goods in August, half of which is a penalty for purchase of Russian oil. New Delhi has called the punitive tariff "unjustified".
The Trump administration recently granted exemption from tariffs for 254 products, including 229 agricultural items. These products cover $1 billion of US imports from India.
"India stands to gain in fruits and nuts, processed foods, spices, tea and coffee. The overall agri exports to US is at $2.5 billion in 2024, roughly $1 billion now stands exempted," Commerce Secretary Rajesh Agrawal said during a press briefing.
Earlier this month, President Donald Trump said the tariffs on India will be brought down as New Delhi has “substantially” reduced Russian oil purchases.
Responding to a question on whether he would consider lowering the current tariff rate on India, Trump said, “Well, right now the tariffs are very high on India because of the Russian oil and they have stopped doing the Russian Oil. It's been reduced very substantially. Yeah, we are gonna be bringing the tariffs down, at some point we are gonna be bringing them down.”
Earlier, while discussing the broader trade negotiations, Trump said the US and India are “making a deal… a much different deal than we had in the past.”
“So right now, they don't love me, but they'll love us again. We're getting a fair deal, just a fair trade deal. We had pretty unfair trade deals... But we're getting close. Scott, I think we're pretty close to doing a deal that's good for everybody, right?...” he added.
In February this year, Modi and Trump directed officials to negotiate a proposed Bilateral Trade Agreement (BTA).
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