US president Donald Trump spoke with Prime Minister Narendra Modi on Thursday, even as negotiators from both countries wrapped up two-day talks here to finalise the contours of the initial tranche of an elusive bilateral trade agreement (BTA).
Modi described the conversation with Trump as “warm and engaging.” He said he and the US President “reviewed the progress in our bilateral relations and discussed regional and international developments,” without an explicit reference to the BTA or the punitive US tariff being levied on Indian exports. “India and the US will continue to work together for global peace, stability and prosperity,” the prime minister posted on X.
Optimism on Timeline
Earlier in the day, Chief Economic Adviser V Anantha Nageswaran told Bloomberg in an interview that he would be surprised if the trade deal with the US isn’t signed by March, as most trade-related issues have been resolved. “I was hoping something would be done by the end of November, but it has turned out to be elusive,” Nageswaran said. “That’s why it is difficult to give a timeline on this. However, I would be surprised if we don’t have it sealed by the end of the financial year.”
The US team to New Delhi was led by Deputy USTR Rick Switzer and included Assistant USTR for South and Central Asia and chief negotiator for the BTA from the US side.
Apart from meeting with commerce secretary Rajesh Agrawal over the past two days, Switzer also met Foreign Secretary Vikram Misri on Wednesday and discussed ongoing trade negotiations and opportunities to boost two-way trade and resilient supply chains.
The meetings over the past two days were termed as a “familiarisation visit”and have not been labelled as a formal round. Both sides have held six rounds of negotiations and other meetings since March 2025 when they finalised Terms Of Reference of their BTA.
Modi’s short statement assumes greater significance as it followed a perceived breakthrough in the bilateral talks that have been on a roller coaster ride for months. Even as the US team was in India, US Trade Representative Jamieson Greer told the Congress that his country received an offer from India that was “the best we’ve ever received as a country,” and that the Indian side had been “quite forward leaning.”
“There is resistance in India to certain row crops and meat and products. They have been very difficult to crack…The kind of offers that (they) have been talking to us have been the best we have ever received as a country, so I think that (India) is a viable alternate market,” Greer said, while testifying before the Senate Appropriations Committee.
Addressing Tariffs
India and the US are engaged on two fronts regarding a trade agreement. The first part is a package that can address reciprocal and penal tariffs on India that total to 50% The second part of trade talks is for a more comprehensive BTA. The US has imposed 25% reciprocal tariffs on Indian imports to bridge the trade gap and another 25% over India’s crude oil purchases from Russia. The deal on additional tariffs will be in the nature of an initial pact which will then be a launchpad for a more ambitious BTA.
The additional tariffs have already led to sharp decline in the Indian shipments to the US of traditional goods like clothing, marine products, engineering goods and leather. Overall merchandise exports to the US fell 8.59% on year to $ 6.30 billion.
The exporters are waiting for an early conclusion of the deal as the US is India’s biggest export market. The US goods and services trade with India totaled an estimated $212.3 billion in 2024, up 8.3 percent ($16.3 billion) from 2023, according to the office of US Trade Representative. India’s goods exports to the US stood at $ 87.3 billion and imports were $41.5 billion. Total services trade was at an estimated $83.4 billion in 2024. India exported $ 41,6 billion services to the US and imported $41.8 billion.