India–US Interim Trade Pact Nearing Final Stage Amid High-Level Talks in Washington

The United States reaffirmed India’s position as a “strategic ally” in the Indo-Pacific region and announced that the much-anticipated interim trade agreement between the two nations is on the verge of being finalised.

White House Press Secretary Karoline Leavitt, addressing reporters, confirmed the development and noted that both President Donald Trump and Prime Minister Narendra Modi continue to share a “very good relationship,” which has accelerated progress on bilateral economic ties.

“Yes, the President said that last week, and it remains true,” Leavitt said when asked about the status of the trade talks. “I just spoke to our Secretary of Commerce about it. He was in the Oval Office with the President. They are finalising these agreements, and you’ll hear from the President and his trade team very soon.”

The interim deal is expected to be announced ahead of July 9, when the suspension of additional tariffs imposed by the US is set to expire. The Trump administration had imposed a 26% reciprocal tariff on Indian exports on April 2, which was temporarily suspended for 90 days. However, a 10% baseline tariff remains in place. India is actively negotiating for complete relief from the additional duty.

Negotiations are currently underway in Washington, led by Special Secretary in India’s Department of Commerce, Rajesh Agrawal. Originally scheduled for two days, the visit has been extended by three more days—until June 30—indicating the advanced stage of discussions. The aim is to close the interim agreement before the tariff suspension ends.

The deal is expected to cover a range of sectors, although agriculture and dairy remain contentious. India has traditionally protected its dairy industry and has not offered concessions in this sector in any of its previous free trade agreements. US officials have pushed for broader access to these markets, but Indian negotiators are treading cautiously.

Beyond the interim arrangement, both countries are targeting a more comprehensive Bilateral Trade Agreement (BTA) by the fall of 2025, with the ambitious goal of expanding annual bilateral trade from the current $191 billion to $500 billion by 2030.

Trump had earlier described the potential deal with India as “very big” and emphasized the need for “full trade barrier dropping” and wider access to Indian markets, though he admitted that such ambitions could take longer to materialise.

As both sides race against the deadline, the negotiations reflect a broader strategic and economic realignment in the Indo-Pacific. The White House has reaffirmed India’s critical role in balancing regional power dynamics, particularly amid growing concerns over China’s influence.

The outcome of these trade talks is expected to significantly shape the trajectory of India–US relations in the coming years, both economically and geopolitically.