US Treasury Secretary Scott Bessent has been optimistic that India will be the first nation to seal a trade deal with Washington, pointing to relatively simple issues that ease negotiations.
Quoting at an off-the-record briefing to journalists in Washington during the World Bank and International Monetary Fund's Spring Meetings, Bessent said, "very close" has been the progress in the negotiations. He underscored India's positive trade practices: "fewer non-tariff barriers to trade, of course, no currency manipulation, very, very little government subsidy, so that negotiating with the Indians is much simpler."
As per accounts from the people in attendance at the meeting, Bessent added that India's major sticking point has been its tariff levels.
In the meantime, US Vice President J.D. Vance, who attended India last week and just met with Prime Minister Narendra Modi to discuss trade relations, reported significant progress had been made.
While speaking in Jaipur on Tuesday, Vance stated, “We’re especially excited to formally announce that America and India have officially finalised the terms of reference for the trade negotiations.”
He continued to emphasize the strategic importance of the development: "This is a critical step towards realizing President (Donald) Trump and Prime Minister Modi's vision because it establishes a roadmap towards a final deal between our countries. I believe there is much America and India can achieve together."
Both leaders assured that they had established a foundation to advance the negotiations and prevent the imposition of a 26 percent tariff that former President Trump threatened would take effect in July under his reciprocal tariff policy, if a deal fails to be reached.
As per a press release by the Vice President's office, the talks are "an opportunity to negotiate a new and modern trade agreement centered on promoting job creation and citizen welfare in both nations.
India has already gone some distance toward that goal, lowering tariffs on legendary American exports like Harley-Davidson bikes and bourbon bourbon whiskey—items that are regularly referenced by Trump. India also has committed to increase imports of American defense and energy products.
Finance Minister Nirmala Sitharaman also emphasized the importance of a trade agreement with the US in a speech at Stanford University's Hoover Institution on Monday. "India's largest and highest-order trading partner is the United States of America, and that reality is not lost on today's government in India," she claimed.
When interacting with members of the Indian diaspora, Sitharaman stated that she anticipates the first part of the trade agreement to be concluded by the fall. "The US is our biggest trading partner with whom we must have an agreement," she emphasized, pointing out that bilateral trade totaled $129 billion last year, with India having a trade surplus of $45.7 billion.
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