The Indian government is poised to finalise an interim trade agreement with the United States by July 8, 2025, ahead of the expiration of a 90-day suspension on a proposed 26% reciprocal tariff on Indian goods. This development follows Commerce and Industry Minister Piyush Goyal’s recent visit to Washington, D.C., aimed at advancing trade discussions.
The proposed deal seeks to eliminate the additional 26% duty and potentially the existing 10% baseline tariff on Indian exports. India is advocating for concessions in labour-intensive sectors such as textiles and leather, while the U.S. is requesting reduced tariffs on industrial and agricultural products.
An Indian official stated, “Talks are progressing positively. We aim to conclude an interim deal before the first tranche of tariffs takes effect on July 8. It will cover goods, non-tariff barriers, and select areas of services, including digital trade. We are working to ensure that the 26% additional duty and possibly the 10% baseline tariff do not apply to India.”
10% Baseline
However, some officials speculate that the 10% baseline tariffs are likely to remain, as the U.S. may choose to maintain them under its trade agreement with the U.K.
During his visit, Minister Goyal met with U.S. Trade Representative Jamieson Greer and U.S. Commerce Secretary Howard Lutnick. Following the meetings, Goyal reported productive discussions aimed at expediting the first tranche of the bilateral trade agreements.
Earlier, on May 15, U.S. President Donald Trump claimed that India had offered to drop all tariffs on U.S. goods. External Affairs Minister S. Jaishankar later clarified that discussions are ongoing and complex, emphasizing that no aspect of the proposed Bilateral Trade Agreement is finalized until all aspects are agreed upon.
President Trump also expressed concerns regarding Apple’s manufacturing operations in India. He stated that he had told Apple CEO Tim Cook that he does not want the company to expand its manufacturing operations within India unless its output is intended for the domestic market.
