US President Donald Trump expressed confidence on Wednesday, January 21, that the United States and India are “going to have a good deal” on their proposed Bilateral Trade Agreement (BTA). Speaking to Moneycontrol after addressing the 56th Annual Meeting of the World Economic Forum in Davos, Trump praised Prime Minister Narendra Modi as a close friend and a respected global leader.
The comments come at a time when India and the US are in tough negotiations over tariffs. Economic tensions have grown in recent months, and geopolitical issues have only added to the pressure.
Trump optimistic about India-US trade deal, praises PM Modi
“I have great respect for your Prime Minister. He’s a fantastic man and a friend of mine, and we are going to have a good deal,” Trump said when asked about the progress of trade talks.
The proposed Bilateral Trade Agreement was first discussed during PM Modi’s visit to Washington in February 2025. The proposal aims for more than double trade between the two countries, from around USD 191 billion now to USD 500 billion by 2030.
Trump previously linked India’s trade stance to its purchases of Russian oil. “They wanted to make me happy,” he said, adding, “Basically, Modi is a very good man. He knew I was not happy, and it was important to make me happy.” He also warned that the US could raise tariffs on Indian goods if India did not align with Washington’s position on Russian energy. India currently faces the steepest tariff of 50 percent.
New Delhi, however, has maintained that its energy decisions are based on national interests and price stability, not outside pressure.
India-US trade ties under strain
The US currently imposes tariffs upto 50% on many Indian exports, including measures tied to India’s engagement with Russia and participation in BRICS. India has responded with selective retaliatory duties on US agricultural imports.
Despite the 50% US tariffs, India’s exports to the US have remained resilient. In December, merchandise exports were $6.89 billion, only slightly below last year’s $7.01 billion and November’s $6.98 billion.
Commerce Secretary Rajesh Agrawal emphasised that the negotiations have never broken down and both sides remain engaged. He added that in the last week of December, Commerce Minister Piyush Goyal held a virtual meeting with US Trade Representative Jamieson Greer to discuss pending issues.
A US delegation visited New Delhi in December, and the new US ambassador, Sergio Gor, presented his credentials on January 14. On January 13, External Affairs Minister S. Jaishankar spoke to US Secretary of State Marco Rubio about trade, critical minerals, nuclear cooperation, defense, and energy.
Earlier this month, US Commerce Secretary Howard Lutnick suggested that a trade deal stalled because PM Modi did not call Trump within a three-week window. The Ministry of External Affairs (MEA) rejected this claim as inaccurate. MEA spokesperson Randhir Jaiswal said, “India and the US were committed to negotiating a bilateral trade agreement since February 13 last year… On several occasions, we have been close to a deal… We remain interested in a mutually beneficial trade deal between two complementary economies and look forward to concluding it.”