Bilateral goods trade between India and the United States reached a record $140.79 billion in FY26, with a $33.82 billion surplus for India.
NEW DELHI: India says its first-tranche trade agreement with the United States is close to done. At HTLS 2026 in New Delhi on 14 November, External Affairs Minister S. Jaishankar said talks had “sorted out the bulk of the issues”. Notably, no signed text, tariff schedule or customs notification exists yet, and the US side has made no public response.
What New Delhi is asking for
India’s stated condition is a deal that gives it a comparative advantage over comparable economies. Jaishankar said the remaining issues sit more at the American end, because changes have come more from Washington. Meanwhile, Commerce and Industry Minister Piyush Goyal said India would secure “one of the best deals”. He added that India would enjoy the “most preferred market access” in products of its interest. Furthermore, he said on 13 November that an announcement could come “quite soon”. However, he cautioned that the US will take some time before the deal comes into effect.
Goods first, services later
A senior official said the first tranche covers goods only, with services moving to a second phase. Digital trade rules are also directed to the broader agreement. The target is conclusion by the end of FY27, on 31 March 2027. Notably, a US team visited Delhi on 2 and 3 November to work on the customs and trade facilitation chapter. Commerce Secretary Rajesh Agrawal reported considerable convergence. The official also said the US has assured India of a comparative advantage over competitors. Moreover, the text lets India modify its concessions if a future US tariff goes beyond the commitment. Consequently, India has built a safeguard against another round of unilateral tariff changes.
Red lines stay in place
Farm livelihoods remain ring-fenced. Goyal said on 3 November that India has never opened its dairy sector and will not allow GM products. He added that dairy products must be strictly certified and free of calf rennet. Likewise, the February framework keeps access within existing import levels for tree nuts, soybean oil and lentils. Meanwhile, $1.36 billion of Indian spice, tea, coffee, fruit and nut exports would face no added US duty under that framework.
Where exporters stand
The stakes are large. The United States is India’s biggest export market. FY26 bilateral goods trade reached a record $140.79 billion, with a $33.82 billion surplus for India. Electronics lead India’s US exports at $24.41 billion, followed by engineering goods at $19.61 billion and pharmaceuticals at $9.47 billion. Indian merchandise exports to the US touched $59 billion between April and October 2026. Furthermore, October’s merchandise exports hit a record $49.47 billion, and Goyal has set a $1 trillion export goal for FY27. Today, a 10% Section 301 forced-labour duty applies to about 55% of Indian exports. Smartphones and generic drugs are exempt. Vietnam faces 12.5% under the same order. Consequently, textiles, garments and gems could gain if the deal widens India’s margin.
What Washington still has to deliver
India’s optimism rests on decisions in the United States. First, the Office of the US Trade Representative (USTR) has yet to publish findings from its Section 301 investigation into industrial overcapacity, which will set the wider tariff structure. Second, the US Supreme Court struck down emergency reciprocal tariffs in February, so Washington needs another legal route for a preferential India rate. Likewise, a waiver on penalties linked to Russian oil purchases is temporary. Consequently, Goyal’s caution on timing carries weight. Indian officials say no further negotiating rounds are scheduled, though that could change.
What to watch
Several dates will test the optimism. First, diplomatic reporting points to a possible Modi-Trump meeting at the Manila summits on 16 and 17 November. Second, the G20 Leaders’ Summit in Miami on 14 and 15 December offers a natural stage for any announcement. Likewise, entry into force needs legal scrubbing, Cabinet clearance and CBIC customs notifications. Furthermore, India is scheduled to sign its EU free trade agreement on 16 December, one day after the Miami G20 ends.
For India, the direction is encouraging. Talks that hit a plateau in October now have an agreed scope, resolved customs language and a safeguard clause. Encouragingly, the deal is built around goods, where India’s manufacturers compete most directly for US orders. It also preserves the red lines that protect farmers and dairy producers. Meanwhile, trade pacts with the UK, EFTA and New Zealand are already in operation, so a US deal would extend a widening network. If Washington publishes its tariff baseline and codifies the promised margin, Indian exporters would gain the certainty they have lacked since 2025. Until then, ministers’ confidence is a signal rather than a schedule. Ultimately, relief on the factory floor will arrive only when tariff schedules, rules of origin and customs notifications are published.
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