Phase one of the proposed India–US bilateral trade agreement (BTA) is close to being finalised and is expected to address Donald Trump’s 50 percent duties on Indian exports and several long-pending market access issues, Union commerce secretary Rajesh Agarwal says.
Agarwal told reporters that negotiations are progressing steadily and that the first tranche of the agreement is “nearly closure.” The package under final review covers the steep 50 percent tariff burden—split between 25 percent reciprocal duties and an additional 25 percent levy imposed as “punishment” for India purchasing Russian crude. Market access concerns raised by both sides will also be part of the phase-one announcement.
The final dates for the announcement will be decided jointly, he added.
The development comes days after President Trump said Washington was “pretty close” to securing a “fair trade deal” with India, and that tariff reductions on Indian goods would be taken up “at some point”.
Agarwal clarified that the BTA is being negotiated in two phases. While the package dealing with reciprocal tariffs is almost complete, the second set of negotiations will require more time.
“We are engaged with the US on the BTA. It has two parts. One part will take time. The other part is a package which can address reciprocal tariffs. We are working on both aspects. The package that can address reciprocal tariffs is more or less near closure,” he said.
One unresolved matter relates to a proposal for Indian oil companies to sign a year-long contract to import LPG from the US in 2026. Agarwal said the move is not part of the BTA itself but fits into India’s broader efforts to maintain a balanced trade relationship with Washington.
The US, meanwhile, is seeking wider access for several agricultural and commodity products, including almonds, pistachios, apples, ethanol and genetically modified items.
The proposed annual LPG supply deal is also being viewed as a potential contributor to narrowing India’s trade surplus with the US. So far, six official rounds of negotiations have taken place, with both sides aiming to announce the first tranche of the agreement in 2025.
Indian officials, including Agarwal, travelled to Washington from October 15 to 17 for the latest round of discussions. The BTA aims to more than double bilateral trade to $500 billion by 2030, from the current level of around $191 billion.
The US remained India’s largest trading partner for the fourth straight year in FY25, recording bilateral trade worth $131.84 billion, including $86.5 billion in exports. It accounts for about 18 percent of India’s goods exports and over 10 percent of total merchandise trade.
However, India’s exports to the US fell 11.93 percent to $5.46 billion in September 2025 due to high US tariffs, while imports rose 11.78 percent to $3.98 billion, commerce ministry data showed.
