What happened?
There is a possibility that India and the United States may agree on an interim trade pact by June 25, with a team of US officials expected to visit India next month for trade talks. India’s chief negotiator, Special Secretary in the Department of Commerce Rajesh Agrawal, recently concluded a four-day visit to Washington, holding talks with his US counterpart. Commerce and Industry Minister Piyush Goyal also visited Washington to provide impetus to trade talks. Both sides are looking for an interim trade deal before the first tranche of the proposed bilateral trade agreement (BTA) as the USA’s 26% reciprocal tariff on India is suspended until July 9. India is pushing for full exemption from this tariff in the interim deal.
Why it matters to India
Concluding an interim trade deal with the US by June 25 is significant for India as it could provide full exemption from the 26% reciprocal tariff, thereby boosting Indian exports. The US remained India’s largest trading partner for the fourth consecutive year, with bilateral trade valued at $131.84 billion in 2024-25. A successful trade agreement would help India achieve its goal of increasing bilateral trade to $500 billion by 2030 and could open new market access for labor-intensive sectors such as textiles, gems and jewellery, and leather goods.