India’s hopes of an early trade deal with the US have dimmed, with Finance Minister Nirmala Sitharaman saying negotiations have reached a “plateau” and further concessions are becoming increasingly difficult. The stalemate comes as Washington steps up tariff pressure over India’s purchases of Russian oil, raising fresh concerns for Indian exporters.
The two countries have been negotiating a bilateral trade agreement since February 2025, but differences over tariffs, market access, the trade imbalance and energy policy continue to block a breakthrough.
Nirmala Sitharaman's remarks signal that a final trade agreement may still be some distance away despite months of negotiations.
Sitharaman said the negotiations had reached a point where additional give-and-take would be “very, very difficult” for both sides. She added that the agreement had already been negotiated intensively, though talks were continuing.
The scope for compromise has narrowed after US President Donald Trump signed legislation allowing tariffs of up to 100% on countries buying significant quantities of Russian oil.
India remains one of the world’s largest buyers of Russian crude. Cutting imports sharply could raise domestic fuel costs and strain government finances, while continuing purchases could expose Indian exports to higher US tariffs.
US Trade Representative Jamieson Greer said last week that an India-US trade agreement was not imminent after meeting Commerce and Industry Minister Piyush Goyal.
Earlier rounds of talks had also failed to deliver a breakthrough, with Washington seeking more concessions and New Delhi pushing for better terms.
The US remains India’s largest export market. India’s goods exports to the US rose to $42.79 billion during April-August from $40.39 billion in the same period a year earlier.
Sitharaman said the bilateral trade balance remained in India’s favour and that Washington was seeking to reduce its deficit.
She also criticised the growing use of tariffs to address trade imbalances, arguing that such measures were increasingly being used as a strategic weapon rather than simply as a negotiating tool.
With both sides signalling limited flexibility, progress on the trade deal will now depend largely on whether they can bridge differences over tariffs, market access and Russian oil purchases.