Union Minister of Commerce and Industry Piyush Goyal with U.S. Secretary of Commerce Howard Lutnick during a meeting in the USA. File
| Photo Credit: X/@piyushgoyal
Commerce and Industry Minister Piyush Goyal on Friday (May 23, 2025) held his second meeting with U.S. Commerce Secretary Howard Lutnick in Washington to discuss the proposed bilateral trade agreement currently under negotiation between the two countries.
On May 20, 2025, Mr. Goyal held a meeting with Secretary Howard Lutnick to expedite the talks on the first phase of the trade pact.
“Held a constructive meeting with Secretary @HowardLutnick for a mutually beneficial trade agreement. Committed to enhancing opportunities for our businesses and people,” Mr. Goyal said in a post on X.
The meeting assumes significance, as both the countries are looking at finalising an interim trade pact by July 8, 2025. The four-day discussions between the chief negotiators have also concluded in Washington on May 22, 2025. In the interim trade deal, New Delhi is pushing for full exemption from the 26% reciprocal tariff on Indian goods.
The U.S. on April 2, 2025, imposed an additional 26% reciprocal tariff on Indian goods but suspended it for 90 days till July 9, 2025. However, the 10% baseline tariff imposed by America remains in place.
Owing to the 90-day suspension of the 26% additional import duty, Indian exporters are at present paying just 10% baseline tariffs, instead of 26% earlier proposed.
At present, the Trump administration requires approval from the U.S. Congress to bring tariffs below the MFN (most favoured nation) rates. But the administration has the authority to remove the reciprocal tariffs imposed on a number of countries, including India.
India may look at certain commitments from the U.S. on the duty concessions for its labour-intensive sector in the first tranche of the proposed Bilateral Trade Agreement (BTA). Both countries have fixed a deadline to conclude the first phase of the pact by fall (September-October) of this year to more than double bilateral trade to $500 billion by 2030.
To boost bilateral trade, India is seeking duty concessions for labour-intensive sectors like textiles, gems and jewellery, leather goods, garments, plastics, chemicals, shrimp, oil seeds, chemicals, grapes, and bananas in the proposed pact with America.
On the other hand, the U.S. wants duty concessions in sectors such as certain industrial goods, automobiles (electric vehicles in particular), wines, petrochemical products, dairy, and agriculture items such as apples, tree nuts, and GM (genetically modified) crops.
While the import of GM crops from the U.S. continues to remain a non-starter owing to regulatory norms in India, New Delhi is open to the import of non-GM products such as Alpha alpha hay (a kind of cattle feed).
The U.S. remained India’s largest trading partner for the fourth consecutive year in 2024-25, with bilateral trade valued at $131.84 billion. The U.S. accounts for about 18% of India’s total goods exports, 6.22% of imports, and 10.73% of the country’s total merchandise trade.
With America, India had a trade surplus (the difference between imports and exports) of $41.18 billion in goods in 2024-25. It was $35.32 billion in 2023-24, $27.7 billion in 2022-23, $32.85 billion in 2021-22, and $22.73 billion in 2020-21. The U.S. has raised concerns over this widening trade deficit.
Published – May 23, 2025 12:19 pm IST