With Commerce and Trade Minister Piyush Goyal and a crew of senior officers within the US, discussions between the 2 international locations are underway with expectations that it might yield the best way ahead and assist clinch a commerce deal.
Whereas the federal government has shunned any touch upon the continuing go to, sources have indicated that a number of discussions are underway on a number of points in a bid to take ahead the stalled negotiations.
The commerce minister, together with senior officers, together with particular secretary and chief negotiator Rajesh Agrawal, is within the US this week, and the delegation is predicted to return later within the week.
Goyal’s go to to the US comes quickly after US commerce negotiator Brendan Lynch, who’s the Assistant US Commerce Consultant for South and Central Asia visited New Delhi and held day lengthy discussions with Agrawal on September 16.
A key sticking level continues to be the penalty of the extra 25% tariff on Indian exports, which India hopes can be withdrawn by the US. It is usually hoped that the commerce deal would soften the tariff on India and decrease it from the prevailing 25%.
India has additionally remained agency on its stance that it might not open up delicate sectors of agriculture and dairy and GM feed, whereas the brand new US coverage on H1B visas is being seen as one other complication in bilateral relations.
Indian exports are bearing the brunt of the excessive tariffs. As per a current GTRI report, India’s US exports plunged 22.2% between Could and August 2025, falling from $ 8.8 billion to $ 6.9 billion as tariffs climbed from 10% to 50%.
“September would be the first full month the place all Class C exports face 50% tariffs, that means the declines in textiles, gems and jewelry, shrimp, chemical substances, and photo voltaic panels might deepen additional,” it additional famous.
Analysts have additionally warned concerning the impression of the tariffs on the economic system. “Whereas India’s direct items export publicity to the US is modest at about 2% of GDP, increased tariffs might erode
competitiveness and amplify oblique progress impression,” stated a report by CareEdge Rankings.
If 50% US tariffs persist, they might pull India’s FY26 GDP progress all the way down to round 6%, the company additional famous. “We stay cautiously optimistic a couple of decision within the coming months that would convey India’s tariffs nearer to its friends, ultimately easing rupee pressures,” it stated.
India Rankings has additionally stated it expects the present account deficit to extend within the second quarter of the fiscal as a result of US tariff woes to an estimated $ 10 billion (1% of GDP), which might be a three-quarter excessive. The present account deficit was at $ 2.4 billion (0.2% of GDP) within the first quarter of the fiscal.
India Rankings expects the merchandise exports to reasonable to a three-quarter low of round $ 110 billion within the second quarter of the fiscal. Merchandise imports, nevertheless, are anticipated to extend to round $ 189 billion in 2QFY26, as a result of a gentle home demand.
