Highlights:
India’s external affairs minister S. Jaishankar has said the long-awaited India-US trade agreement is now close to completion, offering a cautiously positive update after months of tariff tensions between New Delhi and Washington.
Speaking at an Asia Society event in New York attended by Indian Americans, diaspora representatives and policy experts, Jaishankar said the two sides had reached “more or less an understanding” on the agreement. He also acknowledged that the negotiations had taken longer than expected because of the complexity of India’s economy and the changing US tariff framework.
India's commerce and industry minister Piyush Goyal is now travelling to the US from Tuesday (29) to Monday (5), where he is expected to hold talks with US Trade Representative Jamieson Greer on advancing an interim trade agreement.
Jaishankar said that "today, we have reached a situation where there is more or less an understanding on the trade agreement." He spoke at a special conversation hosted by the Asia Society, attended by prominent members of the Indian American and diaspora community and policy experts, as the high-level week of the 81st UN General Assembly wrapped up in New York.
His optimism echoed Commerce and Industry Minister Piyush Goyal, who said last week that the pact was "done and dusted." Goyal said it would be executed once Washington gives India the right competitive advantage over rivals in the American market, including ASEAN countries, China and Bangladesh.
For Indian Americans who have watched ties between their two countries strain over the past year, closing the deal could mark a turning point. "So presumably, if that agreement is closed out, that would be one point which would contribute to a better relationship," Jaishankar said.
India and the US announced a framework for the first phase of the agreement in February. Talks were reopened after the US Supreme Court struck down President Donald Trump's reciprocal tariffs imposed under emergency powers, prompting Washington to adopt a new tariff framework. In July, the US imposed an additional 10 percent tariff on Indian imports under Section 301 of the Trade Act, following a probe into Indian measures on goods produced with forced labor.
Jaishankar said India was now weighing how that process affects the deal. "The 301 process is still in the works, it's still unfolding. So the issue for us is at what point do you close out an agreement which is very, very far advanced," he said.
He acknowledged that reaching this point took longer than many hoped, citing the nature of India's economy. "Bear in mind, India is a society of small producers, small agriculture producers, small factories," he said. "A trade negotiation required a certain amount of ... patience and detailing to see it through… The expectation that it could rapidly move forward, I think, was tested against a ground reality which was much more complex."
Jaishankar also placed the past year's friction in a wider context. "Well, I think if I stand back and look at the relationship,... I note that much of the world has had a more difficult relationship with the US. I mean that may not be a consolation, but that's a reality," he said.
During the conversation, moderated by former American diplomat Daniel Russel, Jaishankar also touched on migration and the growing role of public opinion in diplomacy. Still, he struck an upbeat note on where ties are headed.
"So yes, we would certainly hope for and expect the relationship to move on an upward trajectory. But I have to be real about the issues that we confront, and to the extent we are able to move ahead on some of these issues, I think we'll have a better relationship," he said.
The next step comes quickly. Goyal is visiting the US from September 29 to October 5 for a G20 meeting in Milwaukee and will hold talks with US Trade Representative Jamieson Greer on advancing the agreement.
