India-US trade deal likely to happen after completion of USTR probe: Report

A US trade delegation is reportedly expected to visit India for a new round of negotiations, although the dates of the visit have not yet been finalised.

According to sources cited by ANI, the discussions are likely to cover the ongoing Section 301 investigations by the Office of the United States Trade Representative (USTR), adding that an India-US trade agreement is unlikely to take place until the USTR completes its probe.

Talks between India and the United States on a proposed Bilateral Trade Agreement (BTA) have reportedly become more complicated following a February ruling by the US Supreme Court that found reciprocal tariffs unlawful. Following the decision, the Office of the USTR opened Section 301 investigations into India under the Trade Act of 1974, according to The New Indian Express.

The probes focus on what Washington reportedly describes as “structural excess capacity” in labour-intensive industries, including steel, textiles and solar modules. The US has also alleged that Indian producers benefit from overcapacity and the use of forced labour. India has strongly contested these claims, stating that the US has not identified any specific domestic policies or practices that would support such allegations, the report added.

India and the US trade talks in Washington last month

India and the United States made constructive progress during three days of trade negotiations in Washington, DC, in April this year, with both sides agreeing to continue discussions and maintain the momentum, the Indian government said on Friday, as per PTI.

A delegation of around a dozen Indian officials was in Washington from 20 April to 22 April to work with US counterparts on finalising the details of the first phase of the proposed BTA.

According to a statement from India’s Ministry of Commerce and Industry, the talks covered a wide range of issues, including market access, non-tariff measures, technical barriers to trade, customs and trade facilitation, investment promotion, economic security cooperation and digital trade.

“The meetings were conducted in a constructive and positive spirit, with meaningful and forward-looking discussions enabling progress on key matters. Both sides agreed to remain engaged to maintain this momentum as they move forward,” it stated.

US Trade Representative Jamieson Greer has described India as a “tough nut to crack” in trade negotiations.

India and the US framework for an Interim Trade Agreement (ITA)

After the US Supreme Court struck down President Donald Trump’s broad reciprocal tariffs, which had been imposed under the International Emergency Economic Powers Act (IEEPA) of 1977, the Trump administration introduced a temporary 10% tariff on imports from all countries for a 150-day period beginning 24 February.

Before the court ruling, Washington and New Delhi had worked out a framework under which US tariffs on Indian goods would be reduced from 50% to 18%. The arrangement also envisaged removing a 25% duty imposed on Indian exports in relation to India’s purchases of Russian oil and lowering the remaining tariffs to 18%.

In return, India proposed eliminating or cutting tariffs on all US industrial goods and on a broad range of agricultural and food products, including dried distillers’ grains (DDGs), red sorghum used in animal feed, tree nuts, fresh and processed fruits, soybean oil, wine and spirits, among other items.

New Delhi also indicated that it was prepared to buy $500 billion worth of US products over the next five years, including energy supplies, aircraft and aircraft parts, precious metals, technology products and coking coal.

Meanwhile, China surpassed the US to become India’s largest trading partner in 2025–26. The US had held that position for four straight years through 2024–25.

India’s exports to the United States rose modestly by 0.92% to $87.3 billion in the last fiscal year, while imports from the US increased 15.95% to $52.9 billion. As a result, India’s trade surplus with the United States narrowed to $34.4 billion in 2025–26, down from $40.89 billion in the previous fiscal year.