Piyush Goyal Begins US Visit to Discuss Bilateral Trade Agreement
Union Commerce and Industry Minister Piyush Goyal initiated his visit to Washington on Monday with an intent to take negotiations for a pending bilateral trade pact between India and the United States forward. Goyal is to meet US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick, according to official sources, in preparation for future discussions.
This visit follows Prime Minister Narendra Modi’s recent trip to Washington, where both nations pledged to more than double bilateral trade to USD 500 billion by 2030. They also committed to negotiating the initial phase of a comprehensive Bilateral Trade Agreement (BTA) by fall 2025. Goyal had earlier indicated that the two countries aim to finalize a robust trade agreement within the next 6-8 months.
The visit is timely, coming when US President Donald Trump said he would hike tariffs on Indian imports. Tariffs, or government-imposed import duties, could affect Indian exporters, so Goyal's negotiations are important in mitigating possible trade tensions.
India and the US have traditionally complementary economies, where scope exists for bilateral concessions and reduction of duties. Free trade agreements generally consist of the phase-out or reduction of customs tariffs, in addition to steps aimed at facilitating services trade and investment.
In Trump's first term, the two countries negotiated a mini-trade deal, but the Biden administration pushed it aside, opting for larger trade negotiations. Nonetheless, bilateral trade relations have remained robust. In 2023, two-way trade in merchandise and services reached USD 190.08 billion with India registering a trade surplus. Merchandise exports from India to the US were worth USD 83.77 billion and imports were at USD 40.12 billion, resulting in a trade gap of USD 43.65 billion in favour of India.
During the same year, India's exports of services to the US were USD 36.33 billion, while imports were USD 29.86 billion, giving a surplus of USD 6.47 billion. Interestingly, the US has been India's largest trading partner since 2021-2024, with bilateral goods trade being USD 119.71 billion during 2023-24, with India having a surplus of USD 35.31 billion.
Additionally, India has garnered USD 67.8 billion in US foreign direct investment from April 2000 to September 2024, which signifies the long-standing robustness of the economic alliance.
As the talks progress, Goyal's visit may turn out to be the turning point in balancing the trade dynamics, bringing closer the economic relationship, and creating a strong trade setup for both the countries in the future.
