Sun Feb 16 06:07:50 UTC 2025: ## India and US to Negotiate Trade Deal, Despite Tariff Tensions

**New Delhi/Washington D.C.** – India and the United States announced plans to begin negotiations on a bilateral trade agreement (BTA) this year, aiming to double bilateral trade from $200 billion to $500 billion by 2030. However, the announcement comes amidst rising tensions over tariffs.

While both countries committed to increasing market access and reducing trade barriers, US President Donald Trump simultaneously announced plans to impose reciprocal tariffs on all US trading partners, including India, citing unfair trade practices and imbalances. Trump specifically criticized India’s tariff structure, hindering US product access, particularly automobiles. He highlighted increased oil and gas sales to India as a means to address the trade deficit.

Experts express skepticism about the timing and potential success of the BTA. The US has a history of imposing tariffs despite trade agreements, as evidenced by previous actions against Mexico and Canada. Furthermore, India’s higher average tariffs compared to competitors, and its participation in fewer free trade agreements (FTAs), may limit its negotiating power. Analysts suggest that the agreement would likely require India to make significant tariff concessions.

India’s trade surplus with the US has been growing significantly, reaching $35.33 billion in 2023-24, fueled by increased exports of electronic and engineering goods. However, the US points to India’s high tariffs on agricultural goods and motorcycles as a major point of contention. India’s Foreign Secretary, Vikram Misri, emphasized increased US energy purchases as a potential way to mitigate the trade deficit.

The BTA faces significant hurdles, including existing political sentiment in the US against increased market access for foreign goods and the lack of a strong manufacturing sector in India. The agreement’s success remains uncertain, given the conflicting signals from the US administration and the inherent complexities of negotiating a mutually beneficial trade deal.

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