India is actively accelerating discussions toward finalizing a comprehensive trade agreement with the United States, as both nations seek to capitalize on changing global trade dynamics and growing economic synergy. The renewed urgency follows U.S. President Donald Trump’s recent decision to temporarily halt reciprocal tariffs on multiple trading partners while dramatically increasing import duties on Chinese goods—a move that has disrupted global trade flows and raised hopes for alternate, stable partnerships.
According to a senior Indian government official, who spoke to Reuters on the condition of anonymity, India was among the first countries to initiate formal negotiations for a bilateral trade deal with the United States following Washington’s recalibration of its tariff policy. The official emphasized that both countries have not only entered into preliminary talks but have also jointly agreed to a firm deadline for the conclusion of the first phase of the agreement, which they aim to finalize by the end of the calendar year.
The groundwork for this trade pact was laid earlier in February, during a series of high-level meetings that signaled a strategic alignment between New Delhi and Washington. The envisioned trade agreement is expected to unfold in phases, with an initial focus on resolving tariff-related issues and trade imbalances. In the long term, the goal is significantly more ambitious: to scale bilateral trade to an impressive $500 billion by the year 2030, a target that would represent a substantial leap from current trade volumes and reflect the growing strength of the Indo-U.S. economic partnership.
While India’s Ministry of Commerce and Industry, which is spearheading the negotiation process on behalf of the Indian government, has not issued any official statement or responded to media queries, officials close to the matter have confirmed that the momentum is building steadily behind the scenes.
Addressing an industry gathering in New Delhi earlier this week, India’s Union Minister for Commerce highlighted the adverse impact of China’s trade practices on global manufacturers, particularly those in the United States and India. He emphasized the need for strategic cooperation between the two democratic economies to counter unfair competition and promote fair, transparent, and mutually beneficial trade.
The Indian government is reportedly also planning to intensify inspection and monitoring of imported goods, with a particular focus on goods originating from China. This step is aimed at curbing the practice of dumping—when manufacturers export goods at prices lower than the domestic market or below cost—in order to protect Indian industries from market distortion and unfair pricing.
On the international front, President Trump’s administration made headlines on Wednesday after announcing a 90-day suspension of reciprocal tariffs on a wide range of countries. The abrupt change came after a previous announcement of sweeping tariffs, which had spooked global markets and prompted fears of a full-scale trade war. While this reprieve has eased immediate tensions, it has also clarified Washington’s intention to focus its trade enforcement specifically on China.
In line with this approach, the Trump administration has now imposed sharply higher tariffs on Chinese imports, raising duties to a staggering 125 percent to pressure Beijing into revising its trade policies. In contrast, India’s reciprocal tariff has been maintained at a relatively modest rate of 10 percent, leaving room for continued negotiations and potentially favorable outcomes for Indian exporters.
Among the sectors expected to benefit most immediately from the U.S. tariff pause is India’s seafood industry—especially shrimp exports. The trade official noted that Indian shrimp exporters have faced intense competition from low-cost suppliers such as Ecuador in recent years. The current freeze on additional tariffs, therefore, offers a much-needed respite and could help Indian exporters regain lost ground in the American market.
Other major sectors that were previously affected by tariff escalations include electronics and the gems and jewellery industry. Combined, these two sectors account for over $23 billion in Indian exports—$14 billion in electronics and around $9 billion in gems and jewellery—placing them among the hardest hit during earlier rounds of tariff increases.
Ajay Sahai, Director General of the Federation of Indian Export Organisations (FIEO), an apex body representing over 37,000 Indian exporters, described the 90-day tariff suspension as a pivotal opportunity. According to Sahai, the U.S. administration appears resolute in its aim to economically isolate China while maintaining a steady flow of goods to its domestic consumers. In this scenario, India stands out as one of the most dependable and scalable supply sources.
“If the United States wants to minimize disruptions in its supply chain and keep consumer inflation under control, India remains a reliable, long-term partner capable of meeting demand across various sectors,” Sahai told Reuters.
As the world’s two largest democracies strengthen trade ties, both strategic and economic factors appear to be aligning in favor of a landmark deal. With political will on both sides, complementary economic structures, and a shared interest in maintaining supply chain resilience, the India-U.S. trade agreement could mark a new chapter in bilateral relations, one that offers mutual gains in a volatile global trade environment.