India, US have finalised terms of reference for proposed bilateral trade agreement: USTR

New Delhi: India and the US have finalised the terms of reference outlining the roadmap for negotiations of the proposed Bilateral Trade Agreement (BTA), according to a statement issued by the US.

US Trade Representative (USTR) Jamieson Greer said that these ongoing talks will help achieve balance and reciprocity by opening new markets for American goods and addressing unfair practices that harm US workers.

"India's constructive engagement so far has been welcomed, and I look forward to creating new opportunities for workers, farmers, and entrepreneurs in both countries," he said in a statement.

"I am pleased to confirm that USTR and India's Ministry of Commerce and Industry have finalised the Terms of Reference to lay down a roadmap for the negotiations on reciprocal trade," Ambassador Greer said.

He claimed that there is a "serious" lack of reciprocity in the trade relationship with India.

India and the US on Monday said that they made "significant progress" in negotiations for a mutually beneficial bilateral trade pact as Prime Minister Narendra Modi and US Vice President JD Vance held wide-ranging talks here.

Vance is the first US vice president to visit India in 12 years after Joe Biden visited New Delhi in 2013.

On February 13, the two countries announced to negotiate the BTA. It was decided to finalise the first phase of the pact by the fall (September-October) this year.

According to the USTR, the United States is looking at increasing market access, reducing tariffs and non-tariff barriers, and negotiating a robust set of additional commitments to ensure long-term benefits.

The US has long recognised significant trade barriers with India and as a result, the US ran a USD 45.7 billion goods trade deficit with India in 2024, a 5.1 per cent (USD 2.2 billion) increase over 2023, the statement said.

"The US welcomed the tariff reductions India implemented during the Prime Minister's (Narendra Modi) meeting with President (Donald) Trump in February and its willingness to further reduce tariffs on US products as part of the BTA," it added.

The US total goods trade with India was estimated at USD 129.2 billion in 2024. According to the US, India's average applied tariff is 17 per cent, among the highest of the world's largest economies, while America's average applied tariff is 3.3 per cent.

India's average applied tariff rate on agricultural products is 39 per cent while the USA's is just 5 per cent.

"In addition to tariffs, technical barriers to trade, regulatory barriers, and restrictions on access to the market in the services, industrial, and agricultural sectors also reduce US exports to India," it said.

On April 2, President Trump imposed a 10 per cent tariff on all countries and individualised reciprocal higher tariffs on nations with which the US has the largest trade deficits in order to level the playing field.

"The ToR (Terms of Reference) announcement with India is a critical step forward in negotiations with India to achieve reciprocal trade with one of our most strategic partners and deliver results to the American People," the statement said.

ToRs include issues such as tariffs, non-tariff barriers, rules of origin, and customs facilitation. PTI RR DR