A big update has come out regarding the bilateral trade agreement between India and America. Union Commerce Minister Piyush Goyal has said that both the countries can sign a joint statement in the next 4 to 5 days.
First phase of trade agreement almost ready
The government said that the first phase of the India-US trade agreement is almost ready. He said that this agreement will be formalized after the joint statement and the formal agreement is expected to be signed by mid-March. The minister also clarified that after the release of the joint statement, the Trump government will issue an executive order to reduce US tariffs to 18 percent.
India and GCC signed TOR
India’s orders for American aircraft, engines and other products alone will exceed $100 billion as part of growing trade engagement with the US, the Industry Minister said on Thursday during the signing ceremony of the Terms of Reference for the Free Trade Agreement (FTA) between India and the Gulf Cooperation Council (GCC).
Goyal said trade relations between India and the GCC date back 5,000 years and the agreement will promote free flow of goods and services. He said that the government is actively working on FTAs with developed countries.
According to the minister, this agreement will provide huge benefits to MSMEs, farmers, fishermen, youth and manufacturing sector. Food processing, infrastructure and petrochemical sectors in particular are expected to benefit significantly from this.
India and America complement each other
He said that India and America are complementary economies of each other and the proposed trade agreement between the two countries will be beneficial for both the parties. Giving technical clarity on the process of the agreement, Commerce Secretary Rajesh Aggarwal said the US tariffs are executive tariffs, while India’s tariffs fall in the MFN (Most Favored Nation) category. In such a situation, reduction in MFN tariff in India will be possible only after the signing of a legal agreement.
Goyal said in the Lok Sabha that after Prime Minister Modi’s visit to America in February 2025, both the countries are continuously negotiating bilateral trade agreements. This trade deal was formally announced after the phone conversation between Prime Minister Modi and US President Trump on February 2.
The minister also clarified in the House that during the talks that lasted for almost a year, both sides ensured the security of their sensitive areas. India especially gave protection to sectors like agriculture and dairy, while a balance was also created on sectors important to America.
This bilateral trade agreement was formally proposed in 2025, with the aim of increasing India-US trade from $191 billion to $500 billion by 2030.
