As in-person trade negotiations between India and the U.S. began on Wednesday, U.S. Treasury Secretary Scott Bessent expressed optimism that India would be the first to finalize a bilateral trade agreement, helping to avoid President Donald Trump's planned reciprocal tariffs. According to the New York Post, Bessent told a group of reporters that talks with India are nearing a successful conclusion, citing India’s relatively low tariffs, minimal non-tariff barriers, no currency manipulation, and limited government subsidies as key reasons why a deal is more achievable.

Meanwhile, President Trump, during a White House event where he signed executive orders, remarked that India is expected to reduce its high tariffs as part of the ongoing trade deal. He criticized India for imposing some of the highest tariffs globally, which he said limits U.S. business opportunities in the country. Referring to Harley Davidson, Trump noted the company had to set up a manufacturing plant in India due to the steep import duties, which he believes should have been avoided.

Leading the Indian delegation in Washington, Commerce Secretary-designate Rajesh Agrawal is working to finalize the first phase of the agreement, potentially before the current pause on reciprocal tariffs ends on July 8. The two sides are aiming to complete this initial stage by fall. U.S. Trade Representative Jamieson Greer acknowledged India’s proactive approach but stressed that a lack of reciprocity still hinders progress. He emphasized that ongoing discussions aim to open new markets for American goods and rectify trade imbalances.

Greer also welcomed the recently finalized terms of reference for the trade deal, which were announced by U.S. Vice President JD Vance and Indian Prime Minister Narendra Modi. During his visit, Vance called on India to eliminate non-tariff barriers and allow broader access to American products.

According to a USTR factsheet, India’s average tariff rate stands at 17%, one of the highest among major economies, compared to the U.S. average of 3.3%. The document also pointed to regulatory and technical hurdles in India that continue to limit U.S. exports, especially in services, industrial, and agricultural sectors. The agreement on the TOR is seen as a key milestone in achieving a balanced and mutually beneficial trade partnership.