India has started working on a potential trade deal following a meeting between Prime Minister Narendra Modi and President Donald Trump, with negotiations focusing on tariff reductions and market access.
The Indian government has started working on the proposed trade deal with the United States after Prime Minister Narendra Modi met President Donald Trump in Washington, The Times of India reported, citing sources. The Modi-led government is showing its willingness to engage in tariff reduction with the Trump administration on a bilateral basis. The Indian side argued that, with an “aggressive neighbourhood” in China, duties cannot be lowered significantly for all trading partners.
However, it hopes to secure a good deal on services and visas for businesses and professionals. Sources told The Times of India that India’s average tariff of around 17 per cent (which has since decreased) is well within its WTO commitment to keep customs duty around 50 per cent. The development comes amid remarks by US President Donald Trump about India’s “high tariffs.”
The commerce department is consulting other government ministries and departments but is waiting for the Trump trade team to be in place. It is closely monitoring the issue of reciprocal tariffs and has dismissed reports and estimates, including those from major global banks, as “speculation.”
Although the government has already reduced tariffs on bourbon whisky and bikes, benefiting brands like Harley Davidson, the US is pushing for further cuts. However, officials are keeping their strategy confidential to avoid revealing their negotiation plans.
During Modi’s visit, both leaders agreed to initiate discussions aimed at reaching a trade deal and resolving tariff issues, with plans to complete an initial segment by fall 2025 and a comprehensive agreement within seven months.
