India and the United States are closely negotiating a discrete package of trade issues and also expected to close the deal in the next few weeks in order to remove long-standing trade irritants, with Indian farmers and US manufacturers of medical devices being amongst the main winners in a trade package under negotiation. The two countries began discussions in June that also cover India’s concerns over US steel tariffs and US problems with Indian tariffs on imported IT equipment.
The discussions are not aimed at creating a bilateral free trade agreement, but are focused on removing outstanding sources of friction. US President Donald Trump had previously called out India for unfair trade practices, having already waded into clashes with China and the European Union. At an estimated $126 billion, US goods and services trade with India last year was less than a fifth of its trade with China.
India failed to be given a waiver after the Trump administration imposed new import duties on steel and aluminium imports in March, unlike some other nations. The country retaliated by raising tariffs on several US goods but has held back from implementing them while it negotiates a package to soothe ties. The tariffs were to go into effect from Monday midnight but the government issued an order saying these had been deferred until November 2.