India and US finalize trade deal terms amid tariff discussions

India and the United States have recently finalized the terms of reference for negotiating the first phase of a bilateral trade agreement. This announcement came from an Indian trade official on April 11, 2025. The completed terms are seen as a crucial step towards achieving a potential 'win-win' agreement within the next 90 days. This development follows US President Donald Trump’s announcement on April 9, 2025, regarding a 90-day pause on most tariff increases for significant trading partners, which notably includes India. Such a pause has been welcomed by Indian exporters, giving them temporary relief amidst the ongoing trade tensions worldwide. In February 2025, India and the US had agreed to work on this initial phase of the trade deal, which aims to culminate in a substantial bilateral trade of USD 500 billion by the year 2030. This is part of India's broader strategy to solidify its position in global trade, especially after facing tariffs from other major trading partners. The Indian official expressed confidence in India's progress in negotiations, stating that they are significantly ahead compared to other countries, and pointing out the numerous possibilities available in the coming three months. The continued trade discussions between the two nations are expected to take place virtually and regularly. There might also be delegation-level visits from both sides to facilitate face-to-face discussions that could further push the talks forward. Speculations suggest that US Vice President JD Vance may be visiting India soon to engage in these talks, signifying the importance both nations place on enhancing their trade relationship. India’s trade ties with the US have historically been strong, with bilateral trade reaching around USD 129 billion in 2024, favoring India with a surplus of USD 45.7 billion. In light of the recent tariff hikes announced by the Trump administration, which involved a significant 26% tariff on Indian goods, India has proactively asked its customs authorities to closely scrutinize exports and imports. This step is intended to ensure that India's trade channels are not misused as conduits for goods intended for the US and that it actively counters any potential trade diversions as businesses might attempt to reroute goods through India to evade higher tariffs imposed on China. India's Ministry of Commerce has also initiated a global tariff and trade helpdesk to assist stakeholders in navigating import and export challenges efficiently, thus reinforcing India’s role as a reliable trading partner in the global market.