India and the US are looking to the early conclusion of an interim trade agreement, with an American delegation expected to travel to New Delhi soon to take forward the process and reach an understanding that serves the national interests of both sides, external affairs minister S Jaishankar and his US counterpart Marco Rubio said on Sunday.
There have been few signs of forward movement since Prime Minister Narendra Modi and US President Donald Trump announced on February 2 that the two sides were close to a trade deal, including the slashing of American tariffs on Indian exports. Though the Trump administration’s attention has been occupied by the West Asia crisis, India and the US have continued talks to conclude a trade deal.
Jaishankar emphasised the importance of an early understanding on the trade deal at a joint news conference with Rubio, and expressed the hope that a US team will come to India soon to move the process along. “On the economic front, we spoke about the value of concluding, at an early date, the final text of the interim agreement regarding reciprocal and mutually beneficial trade,” Jaishankar said.
This, he said, will be an important step towards a comprehensive bilateral trade agreement, as envisaged during Modi’s talks with Trump during a visit to Washington in February 2025. “We had a team recently in Washington and our expectation is that an American team will be visiting India soon for that purpose,” he said.
{{/usCountry}}This, he said, will be an important step towards a comprehensive bilateral trade agreement, as envisaged during Modi’s talks with Trump during a visit to Washington in February 2025. “We had a team recently in Washington and our expectation is that an American team will be visiting India soon for that purpose,” he said.
{{/usCountry}}Rubio added: “We are hopeful that our Trade Representative can visit here very soon. We had an Indian delegation in the US…We’ve made tremendous progress. I think we’re going to wind up with a trade agreement between the US and India that’s going to be enduring and is going to be beneficial to both sides. and sustainable in a way that addresses this national interest that we have.”
Both sides didn’t provide a specific timeline for finalising the interim trade agreement, though Rubio sought to paper over the differences created by Trump’s tariff policies. India-US relations nosedived when Trump hit Indian exports with 50% tariffs, including a 25% levy over Russian energy purchases.
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“This is not about India, this is about the US in terms of trade. The President did not say, let’s figure out a way to create friction with India over trade,” Rubio said, contending that Trump’s actions were aimed at addressing the US’s trade imbalance “from a global perspective” and bringing back manufacturing to the US. “There needed to be a rebalancing of how we approach global trade, not just with India, with the European Union, with countries all over the world,” he said.
The difference in India’s case is the size of its economy and the huge volume of trade with the US. “I think it’s just caught up in that. The good news is that, through this rebalancing, we ultimately…believe we will arrive at trade arrangements around the world that are good for the US, but also good for our trade partners,” Rubio said. “And one of those we hope will be India. In fact, we are on the verge of making that happen.”
Rubio pointed to India’s inclusion in Pax Silica, the US-led initiative for secure global supply chains for AI technology and semiconductors, and investments of more than $20 billion by Indian companies in the US as signs of the growing economic cooperation between the two sides. “I think the relationship continues to be strong and…I believe by the end of this administration, it will be stronger than it’s ever been,” he said.
Jaishankar pointed to the scope for cooperation in critical minerals and AI and said India will encourage its businesses dealing with AI to explore opportunities in the US. “As India’s semiconductor and AI capabilities advance, this cooperation will be even more prominent,” he said.
At the same time, Jaishankar said he had raised with Rubio the Indian side’s “fundamental responsibility” of addressing the energy needs of the country’s 1.4 billion people, including ensuring “accessibility and affordability” of energy. “The secretary and I welcomed the expansion in our energy trade in recent months. Diversified supplies are at the heart of energy security for India,” he said.
The two sides also discussed nuclear energy cooperation and Jaishankar said the passage of India’s Shanti Act has opened up new possibilities in this sector. “An American delegation was recently in India. We hope to realise the potential of cooperation in the nuclear domain and I raised with the secretary some regulatory issues we have on the American side,” he said without giving details.