India Targets U.S. Trade Deal by November Despite Tariff Setback

Union Commerce and Industry Minister Piyush Goyal on Tuesday expressed optimism that India and the United States could finalise a bilateral trade agreement (BTA) by November, even as Washington has sharply raised tariffs on Indian exports.

Speaking at the Annual Global Investor Conference 2025, Goyal said he expected negotiations to “get back on track soon,” adding that both nations had earlier agreed on a timeline for concluding the pact by autumn. His remarks come at a time when talks remain suspended after U.S. officials postponed a scheduled August 25 visit to New Delhi.

Rising Tariff Pressures

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The trade discussions have been overshadowed by the Trump administration’s decision to double duties on Indian exports, pushing tariff levels to 50% from August 27. This makes Indian goods among the most heavily taxed globally, on par with Brazil.

The additional 25% levy was announced after President Donald Trump criticised India’s reliance on Russian oil and defence imports. Posting on Truth Social, Trump called trade relations with India “totally one-sided” and argued that American companies had been locked out of the Indian market for too long.

“They have now offered to cut their tariffs to nothing, but it’s getting late. They should have done so years ago,” Trump wrote, describing India’s Russian purchases as a “deal breaker” for negotiations.

According to government sources cited by The Indian Express, fresh talks are unlikely to resume until Washington reconsiders the higher tariff structure.

India’s Response and Export Measures

In response to the U.S. decision, Goyal will meet with leading exporters and representatives from export promotion councils (EPCs) and the Federation of Indian Export Organisations (FIEO) on Wednesday. The discussions will centre on strategies to safeguard Indian exporters facing higher duties in their largest market.

Officials have indicated that the Commerce Ministry is preparing a three-pronged plan—short, medium and long-term—to mitigate the impact. Immediate steps may include easing operational rules for special economic zone (SEZ) units, creating a flexible inventory model for e-commerce exports, and ensuring adequate liquidity to prevent insolvencies.

Medium-term measures will involve leveraging free trade agreements, expanding buyer-seller linkages, and reinforcing GST reforms. Over the longer horizon, the government is exploring targeted import substitution to reduce external dependence and strengthen domestic supply chains.

Trade Outlook

Despite recent tensions, India’s export sector showed resilience in July 2025, with outbound shipments rising 7.29% year-on-year to $37.24 billion, snapping a two-month decline. However, imports grew at a faster pace, pushing the trade deficit to $27.35 billion—an eight-month high.

During the April–July period of FY26, exports expanded by 3.07% to $149.2 billion, while imports climbed 5.36% to $244.01 billion, resulting in a cumulative deficit of $94.81 billion.

Conclusion

While tariff barriers have cast a shadow over India–U.S. trade ties, New Delhi remains hopeful of reviving negotiations in the coming months. A successful deal by November could ease pressures on exporters, restore momentum in bilateral trade, and provide clarity to businesses navigating a volatile global environment.