Archive · 3 Sep 2026
India-US Trade Pact Awaits Preferential Tariff Terms from Washington
India and the United States are trying to make a trade agreement.
India wants its businesses to pay tariffs that are better than the tariffs paid by businesses from competing countries.
Tariffs are extra charges on goods brought into a country.
Piyush Goyal said India will complete the agreement after the United States offers this advantage.
The countries are also discussing digital trade, market access, supply chains and other trade rules.
Exporters say uncertainty about tariffs is causing American buyers to place smaller orders and avoid long contracts.
India and the United States announced a framework for the agreement’s first phase in February.
Their negotiating teams later reported substantial progress, but changes in US tariff policy led to more discussions.
India is also trying to use other trade agreements to expand exports and reach more businesses.
Piyush Goyal said India will finalize and announce the US trade agreement after Washington offers Indian exporters better tariff terms than competitors.
India and the United States are negotiating market access, digital trade, non-tariff barriers, supply-chain cooperation and strategic-sector issues.
India faces US-market competition from Bangladesh, Vietnam, Thailand, Sri Lanka, Cambodia, Indonesia and Malaysia.
Exporters said tariff uncertainty has reduced order volumes, discouraged large or long-term commitments and prompted US buyers to diversify suppliers.
India reported $140.76 billion in bilateral trade during fiscal 2025-26, while a separate 2025 figure put goods trade at $149.42 billion.
- Who
- India, represented by Commerce and Industry Minister Piyush Goyal, and the United States, with US Trade Representative Jamieson Greer involved in the talks.
- What
- The countries are negotiating a Bilateral Trade Agreement, which India says will be finalized after Washington offers preferential tariff terms compared with competitors.
- When
- Goyal made the statement on Thursday, September 3, 2026; the first-phase framework was announced in February, and Greer visited New Delhi from June 22 to 24.
- Where
- The negotiations concern access to the US market; Goyal is expected to discuss the pact in Milwaukee and Chicago during a late-September US visit.
- Why
- India wants its exporters to remain competitive against rival suppliers, while businesses want tariff uncertainty and market-access concerns reduced.
Government and Negotiators
Exporters and Industry
Timing of the agreement
Government and Negotiators
Goyal said India will finalize the BTA once the United States provides preferential tariff terms compared with competing countries.
Exporters and Industry
Exporters urged the government to conclude the pact quickly to reduce uncertainty over US market access and orders.
Effect of tariff uncertainty
Government and Negotiators
The Commerce Ministry is reviewing trade patterns, sector performance and industry concerns for discussions with US authorities.
Exporters and Industry
Industry representatives said US order books appeared stable but volumes had declined, while buyers avoided large or long-term commitments and diversified suppliers.
What determines export success
Government and Negotiators
The government says tariff advantages should be used to expand scale, improve quality, ensure reliable delivery and bring more businesses into international trade.
Exporters and Industry
Industry groups also want specific concerns, including US safeguard measures affecting quartz surface products, addressed in discussions with Washington.
- Condition for finalization
- India says it will finalize and announce the BTA after the United States provides tariff terms better than those available to competitors.
- Negotiation subjects
- Market access, digital trade, supply-chain resilience or cooperation, non-tariff barriers and strategic-sector cooperation.
- US tariff change
- The United States imposed an additional 10% tariff on several countries, including India, beginning July 24, according to the reports.
- Fiscal 2025-26 trade
- India-US bilateral trade totaled $140.76 billion, compared with $132.2 billion in fiscal 2024-25.
- Fiscal 2025-26 balance
- India exported $87.31 billion to the United States, imported $53.45 billion and recorded a $33.9 billion trade surplus.
- Calendar-year 2025 trade
- A separate report cited $149.42 billion in goods trade, comprising $103.82 billion in Indian exports and approximately $45.6 billion in US exports.
- India’s export targets
- India is targeting $1 trillion in exports in the current year and $2 trillion by 2030, according to Goyal.
Sources
India-US trade deal hinges on preferential terms from Washington, says Piyush Goyal
‘As Soon As Washington Offers Preferential Terms’: Piyush Goyal Tells When India-US Trade Pact Will Be Finalised
US trade deal finalisation hinges on tariff edge over competitors: Piyush Goyal
India-US Bilateral Trade Agreement: Piyush Goyal reveals what US should announce to finalize deal
