On Friday, Commerce and Industry Minister Piyush Goyal met for the second time with US Commerce Secretary Howard Lutnick in Washington to advance discussions on a proposed bilateral trade agreement currently being negotiated between India and the United States. Their earlier meeting took place on May 20, aimed at accelerating progress on the first phase of the trade pact.

Following the latest meeting, Goyal shared on social media, stating it was a "constructive meeting" focused on achieving a trade agreement that benefits both nations, and reaffirmed their commitment to expanding business and employment opportunities. This round of talks is especially significant, as both countries aim to finalize an interim trade agreement by July 8. The chief negotiators concluded four days of discussions in Washington on May 22.

As part of the interim deal, India is advocating for complete exemption from a 26% reciprocal tariff imposed by the US on Indian exports. Although this additional tariff was enacted on April 2, it has been temporarily suspended for 90 days, until July 9. During this suspension, Indian exporters are subject only to the 10% baseline tariff instead of the full 26%.

While the US administration needs Congressional approval to lower tariffs below the most-favoured-nation (MFN) rates, it does have the power to eliminate the reciprocal tariffs currently applied to countries like India. India is seeking US commitments for duty reductions in key labour-intensive sectors in the initial phase of the deal. The two nations are targeting completion of this first phase by the fall (September–October) to help scale up bilateral trade to $500 billion by 2030.

India’s focus areas for tariff concessions include textiles, leather, garments, gems and jewellery, plastics, chemicals, seafood, oilseeds, grapes, and bananas. The US, meanwhile, is interested in reduced duties on industrial goods, electric vehicles, wines, dairy, petrochemicals, and agricultural products like apples, tree nuts, and genetically modified (GM) crops. Although India has regulatory restrictions on importing GM crops, it has expressed willingness to allow imports of non-GM items such as Alpha alpha hay, used as cattle feed.

The US has remained India’s largest trading partner for the fourth consecutive year (2024–25), with total trade reaching $131.84 billion. The US makes up about 18% of India’s exports, 6.22% of imports, and over 10% of total merchandise trade. India enjoyed a trade surplus of $41.18 billion with the US in 2024–25, continuing a growing trend in its favour over the past several years. However, the US has voiced concerns about this widening trade gap.