By Shruti Srivastava and Sudhi Ranjan Sen
India is discussing a US trade deal structured in three tranches and expects to reach an interim agreement before July, when President Donald Trump’s reciprocal tariffs are set to kick in, according to officials in New Delhi familiar with the matter.
The interim deal will likely cover areas including market access for industrial goods, some farm products and addressing some non-tariff barriers, such as quality control requirements, the people said, asking not to be identified because the discussions are private.
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The talks are still ongoing and there’s no clarity if the Trump administration has agreed to a three-stage process for a trade deal. India’s Commerce Minister Piyush Goyal is currently in Washington on a four-day trip that ends Tuesday. In a post on X, Goyal said he had “good discussions” with US Commerce Secretary Howard Lutnick to advance the first tranche of the trade agreement. The Indian minister is also expected to meet US Trade Representative Jamieson Greer during the trip.
Good discussions with Secretary @HowardLutnick towards expediting the first tranche of India-US Bilateral Trade Agreement. pic.twitter.com/8JjklXyEjl
— Piyush Goyal (@PiyushGoyal) May 19, 2025
India’s Ministry of Commerce and Industry and Ministry of External Affairs didn’t immediately respond to requests for further information. The USTR and Commerce Department also didn’t immediately respond to questions.
The second stage of an India-US deal may be a broader and more detailed agreement timed for around September to November, Indian officials familiar with the matter said, likely covering the 19 areas outlined in the terms of reference agreed by the two sides in April. The timing for this part of the deal may be aligned with an expected visit by Trump to India for the Quad leaders’ summit, one of the people said.
The final leg of the deal will likely be a comprehensive agreement that would follow once there’s approval from the US Congress, possibly concluded only next year, Indian officials familiar with the matter said.
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India was one of the first countries to begin trade negotiations with the US following Prime Minister Narendra Modi’s visit to the White House in February shortly after Trump took office. Both leaders agreed to boost trade and work toward concluding the first tranche of the bilateral deal by fall of this year. Since then, New Delhi has signaled the possibility of “early mutual wins” before the fall deadline.
While Indian officials say talks remain on track, there have been signs of tension in recent days. New Delhi appears to be adopting a tougher stance in negotiations, threatening retaliatory tariffs on US goods last week. Trump has also claimed that India offered to slash tariffs on US goods to zero, while downplaying any sense of urgency to reach a trade deal.
The US leader’s comments about his involvement in negotiating a ceasefire between India and Pakistan have also been a source of frustration in New Delhi. Trump has repeatedly said he used trade as a bargaining tool to secure a truce between India and Pakistan after four days of military conflict that had brought the two South Asian rivals close to an all-out war. Indian officials have denied Trump’s assertions.
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Chairman of the Sixteenth Finance Commission Dr. Arvind Panagariya on Monday said the commission will submit its report to the central government by October 31.
Panagariya said this in a meeting of the commission held here with Chief Minister Pushkar Singh Dhami.
The chairman praised Uttarakhand for moving ahead rapidly on the development front and said that in view of the difficult geographical conditions, extensive discussions will be held to find solutions to the challenges being faced by other hill states, including Uttarakhand.
Earlier in the meeting, CM Dhami presented his views on the financial situation, challenges and development needs of the state.
He requested the Finance Commission to provide suitable compensation in keeping with the spirit of 'environmental federalism' in view of Uttarakhand's 'eco service cost', increase the weightage of forest cover in 'tax-devolution' to 20 per cent and consider special grants for proper management and conservation of forests in the state.
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The Chief Minister said that in the last 25 years, Uttarakhand has made remarkable progress in the field of financial management like other areas.
The size of the state budget has crossed Rs 1 lakh crore, while in the SDG Index Report of the year 2023-24 released by NITI Aayog, Uttarakhand has emerged as the leading state in the country among the states achieving the goals of sustainable development, he said.
Referring to the two main challenges being faced by the state due to more than 70 per cent of the total geographical area of Uttarakhand being covered by forests, Dhami said that on one hand this leads to more expenditure for the conservation of forests, while on the other hand, due to the prohibition of any other development activity in the forest area, 'eco service cost' also has to be borne.
In this regard, he requested for appropriate compensation to the State in accordance with the spirit of 'Environmental Federalism', increasing the weight prescribed for forest cover in 'Tax-Transfer' by 20 percent and special grant for proper management and conservation of forests in the State.
He said that since the state's industrial package ended in 2010, the locational disadvantage is not being met, while special budget provisions have to be made in the hilly regions of the state due to difficult geographical conditions and other practical difficulties as the private sector participation in important sectors like education and health is very limited.
Describing Uttarakhand as very sensitive to natural disasters, the CM said that the state needs continuous financial support to effectively deal with disasters and for relief and rehabilitation work.
Dhami, referring to the limited possibilities of hydropower generation in Uttarakhand due to the rules implemented after the Ganges was declared a national river, said that due to this the hydropower sector is not able to make the expected contribution and there is a huge loss in the field of employment along with revenue.
He also requested the Finance Commission to provide special assistance in view of the higher cost involved in developing additional infrastructure for transport, drinking water, health, waste management and other services in view of the 'floating population' visiting pilgrimage sites.
A delegation of the party led by State Congress Vice-President Suryakant Dhasmana also met Dr. Panagariya and requested for a green bonus for the state and economic package to stop migration and consider the special geographical conditions of the state.
Dhasmana demanded that the state should be given a green bonus as compensation for its environmental services, protection of water, forest and biodiversity for the country.
He said that there should also be a provision of a special package for the state for long-term disaster management preparedness.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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