India, US to finalise contours of proposed trade deal: Govt

India and the US will sit together in the next couple of weeks to decide on the nature of the proposed trade agreement and finalise its broad contours, a senior official said on Monday.

During the recent visit of Prime Minister Narendra Modi to Washington, India and the US announced to more than double the two-way commerce to USD 500 billion by 2030 and negotiate the first tranche of a mutually beneficial, multi-sector bilateral trade agreement (BTA) by fall of 2025.

“Give us a couple of weeks to decide what is the level of ambition in the first tranche (of the agreement) that we are looking at and what is the nature of the agreement that we will be arriving at. The two sides will need to sit together and try to finalise the broad contours,” Additional Secretary in the Department of Commerce Rajesh Agrawal told reporters here.

The two countries have also agreed to collaborate to enhance bilateral trade by increasing US exports of industrial goods to India and Indian exports of labour-intensive manufactured products to the US.

The two sides will also work together to increase trade in agricultural goods.

India exports agri goods worth over USD 4 billion to America and that will get a further boost, he said, adding that there is a ‘tough’ timeline of 8-9 months for concluding the first tranche.

FTA-like agreement in tariff war times

Talking about the pact, an official said that the roadmap to increase bilateral from about USD 200 billion at present to USD 500 billion by 2030 will require an agreement like an FTA (free trade agreement). “But it is not akin to FTA because we have to work out the contours. Once their negotiating teams are in place in the US, we will start working together and then we will develop the contours of this mutually beneficial bilateral trade agreement and based on that, we will move forward,” the official said.