Commerce and Industry Minister Piyush Goyal will lead a team of senior Indian officials to Washington starting May 17 for crucial discussions with U.S. counterparts on the proposed bilateral trade agreement (BTA). The visit aims to advance negotiations on key issues including market access, rules of origin, and non-tariff barriers that affect trade flows between the two countries.

During the four-day talks scheduled from May 17 to 20, Mr. Goyal will hold meetings with U.S. Trade Representative Jamieson Greer and U.S. Commerce Secretary Howard Lutnick. The chief negotiators from both nations will also conduct meetings from May 19 to 22, aiming to build momentum for an interim trade arrangement on goods that would deliver early mutual benefits. The goal is to finalise the first phase of the trade pact by fall 2025, between September and October.

A significant backdrop to these talks is the recent U.S. suspension of additional tariffs on Indian goods, specifically the 26 percent duties on steel and aluminium, until July 9, as part of a 90-day tariff pause window intended to ease trade tensions. However, the baseline 10 percent tariff remains in place. India has also proposed retaliatory duties on certain U.S. products in response to these tariffs, which will be part of the dialogue.

The trade negotiations cover a broad spectrum of sectors. India is seeking duty concessions on labour-intensive exports like textiles, gems and jewellery, leather goods, garments, plastics, chemicals, shrimp, oil seeds, grapes, and bananas. The U.S., in return, is pushing for concessions in industrial goods, electric vehicles, wines, petrochemicals, dairy, and agricultural products such as apples and tree nuts.

The finalized terms of reference for the BTA encompass approximately 19 chapters addressing tariffs, goods, services, rules of origin, non-tariff barriers, and customs facilitation. The U.S. has repeatedly expressed concerns about non-tariff barriers that hinder American goods’ access to the Indian market.

In 2024-25, the U.S. remained India's largest trading partner for the fourth consecutive year, with bilateral trade valued at $131.84 billion. The U.S. accounted for about 18 percent of India’s goods exports, 6.22 percent of imports, and 10.73 percent of total merchandise trade. India maintained a goods trade surplus with the U.S., which grew to $41.18 billion in 2024-25, up from $35.32 billion the previous year, a development that has drawn U.S. attention.

A key provision under discussion is the ‘rules of origin’ clause, which requires that products exported to India under the trade pact have a minimum percentage of their value added within the exporting country. This rule is designed to prevent countries from circumventing tariffs by re-labeling goods imported from third countries.

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