India, US Hold Positive Talks on Bilateral Trade Agreement, Says Commerce Department

Delegations discuss trade in goods and non-tariff measures as negotiations on interim and broader trade arrangements continue

India and the United States conducted what the Commerce Department described as “constructive and positive discussions” on a range of issues, including trade in goods and non-tariff measures, while reaffirming their commitment to concluding a mutually beneficial Bilateral Trade Agreement (BTA) aimed at strengthening trade and economic ties between the two countries.

A US trade delegation led by chief negotiator Brendan Lynch met with the Indian negotiating team from June 1–4 to continue discussions on the proposed BTA and move the process closer to conclusion.

According to a statement issued by the Commerce Department, the discussions were marked by cooperation and pragmatism, with both sides reiterating their commitment to reaching an agreement that enhances bilateral trade and economic relations.

While the statement did not specify a timeline for completing the negotiations, sources indicated that efforts are underway to finalize an agreement at the earliest possible stage.

Interim Agreement Framework

The Commerce Department noted that the discussions build upon the India-US joint statement issued on February 7, 2026, under which both countries agreed to establish a framework for an interim reciprocal trade arrangement.

Under that framework, India had agreed to additional US tariffs of 18 per cent at a time when it faced reciprocal US tariffs of 25 per cent, along with another 25 per cent penalty tariff linked to purchases of Russian oil.

Subsequently, the Donald Trump administration rolled back the penalty tariffs after the US Supreme Court invalidated the reciprocal tariff structure. The measure was replaced by a 90-day global tariff of 10 per cent, which is scheduled to expire on July 24.

Section 301 Tariff Concerns

India is also facing a potential Section 301 tariff of 12.5 per cent related to forced labour findings. The tariff burden could increase further following the release of the second Section 301 investigation report concerning excess capacity.

“There is a possibility that the US will agree to cap the tariffs under the BTA at 18 per cent or so. That is what is being negotiated. India has demanded more market access than its competing countries such as Vietnam, Bangladesh and Indonesia,” a source said.

The ongoing negotiations are expected to address tariff-related issues alongside broader market access discussions as both countries work toward finalizing the trade arrangement.