India seeks US preferential rate to finalize pact
India‑United States trade pact remains on hold until Washington offers a preferential tariff rate, Commerce and Industry Minister Piyush Goyal said on Thursday.
India Awaits US Tariff Offer Before Signing Trade Pact
Goyal told a workshop on free‑trade agreements that the details of the Bilateral Trade Agreement will be announced only after the United States proposes a rate better than those enjoyed by India’s regional rivals. “And as soon as the US is able to give us the preferential rate, in comparison to our competition, we will finalise the BTA and announce the final details,” he said.
The United States imposed an additional 10% tariff on a range of products, including Indian goods, starting July 24. That move prompted fresh negotiations despite an earlier framework agreement reached in February.
Goyal plans to travel to the United States in late September for the G‑20 Trade Ministerial in Milwaukee, where he will meet USTR Jamieson Greer to discuss the outstanding issues.
Related: Celebrity Food Ads Under Legal Scrutiny
India’s Expanding Web of Free‑Trade Agreements
India already has nine free‑trade agreements covering economies that together account for about $60 trillion of global GDP. Goyal said these pacts give India preferential access to roughly two‑thirds of world trade.
He added that pending agreements with Canada, Mexico, Chile, the Mercosur bloc, the South Africa Customs Union, the Gulf Cooperation Council and Israel, plus reviews of deals with ASEAN, Korea and Japan, will lift India’s market reach to about 75 % of global trade at rates lower than its competitors.
Existing pacts with the United Kingdom, Mauritius, Oman, the United Arab Emirates and Australia are already in force, while a deal with New Zealand is expected to become active soon, followed by the EU agreement.
“The absolute tariff number was immaterial and had to be considered in relation to the competition,” Goyal said, using the textile sector as an example. He noted that Bangladesh and Vietnam have long benefitted from lower duties, but India now enjoys better rates in most developed markets.
Related: Sustainability key to future product design
India exported goods worth about $87 billion to the United States in fiscal year 2025‑26.
Goyal’s push for the US deal comes as India targets a $1 trillion export figure for the current fiscal year. Exports in the first four months reached roughly $317 billion, up from $280 billion in the same period a year earlier.
“The ball is now entirely in our court,” Goyal said, urging manufacturers to focus on scale, quality and reliable delivery.
Goyal will raise the US tariff issue during the two‑day ministerial that starts on September 30, coinciding with the United States’ 2026 G‑20 presidency. The outcome could shape India’s ability to compete with rivals such as Sri Lanka, Bangladesh, Thailand, Cambodia, Vietnam, Indonesia and Malaysia in the American market.
