US-India Trade Deal AT A STANDSTILL? India Awaits Crucial Response as Key Issues Spark Tensions!

India is nearing the conclusion of its bilateral trade agreement (BTA) negotiations with the United States and is currently awaiting the US response to its latest proposal. Government sources indicate that India has safeguarded its sensitive sectors within this proposal and anticipates that another round of talks may not be required. U.S. President Donald Trump has previously acknowledged significant progress, aiming for a fair and balanced agreement.

However, a major obstacle remains India's continued purchase of oil from Russia, a move the US wants India to cease, citing its role in fueling the war in Ukraine. India counters that it must not be singled out and prioritizes its energy security, highlighting its strong historical relationship with Russia. The US has imposed a 50% duty on certain Indian goods, with 25% attributed as a penalty for Russian oil purchases; India seeks a complete rollback of this penalty and reciprocal tariff reductions to gain a competitive edge against countries like Vietnam and Bangladesh, which face lower duties.

Another point of contention is the US demand for increased market access in India's agriculture and dairy sectors, particularly for genetically modified soya and corn, which India currently restricts.

Impact: This trade negotiation's outcome could significantly influence India's trade balance, import/export dynamics, and the competitiveness of its key sectors like agriculture, dairy, and energy in the US market. Investor sentiment towards Indian companies involved in these sectors may also be affected. Rating: 7/10

Difficult Terms: Bilateral Trade Agreement (BTA): An agreement on trade signed between two countries. Genetically Modified (GM): Organisms whose genetic material has been altered using genetic engineering techniques.