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The article details India's Finance Minister Nirmala Sitharaman's statements regarding the progress of a bilateral trade agreement with the United States. Speaking in San Francisco during an official visit to the US to attend the Spring Meetings of the International Monetary Fund (IMF) and World Bank, Sitharaman expressed optimism about finalizing the first tranche of the agreement by the end of the American autumn season, which spans from mid-September to mid-December. This timeframe suggests a concerted effort to expedite negotiations and reach a preliminary agreement within a relatively short period. The minister emphasized that discussions are proceeding steadily, with both sides actively working to address outstanding issues and establish a strong foundation for a more comprehensive trade partnership in the future. The commitment from both nations to resolve these issues underscores the importance placed on strengthening economic ties and fostering mutually beneficial trade relations. Sitharaman's presence at the IMF-World Bank meetings provided an opportunity to engage with key US officials, including the Treasury Secretary, further demonstrating the high-level attention being given to the trade negotiations. The article highlights the engagement between the Indian and US governments, citing Prime Minister Narendra Modi's visit to the United States in February and the subsequent visit by the Indian Commerce Minister. These high-level engagements signal the political will to prioritize the trade agreement and foster stronger bilateral relations. Additionally, the visit of the additional USTR (junior trade minister) to India indicates the ongoing technical discussions and negotiations focused on tariff-related matters and the overall framework of the trade agreement. This multi-layered approach, involving political leaders, cabinet ministers, and trade negotiators, demonstrates a comprehensive strategy aimed at achieving a successful outcome. Furthermore, the article references a prior agreement in February where India and the US agreed to pursue the first phase of a trade deal in 2025, with the ambitious goal of boosting bilateral trade to $500 billion by 2030. This long-term vision underscores the strategic importance of the trade agreement in driving economic growth and fostering deeper commercial ties between the two nations. The target of $500 billion in bilateral trade represents a significant increase from current levels and highlights the potential for enhanced economic cooperation. However, the article also acknowledges challenges in the form of the US announcement of a 26% reciprocal tariff on Indian exports, citing India's average 52% import duty on American goods. This move, part of President Donald Trump's ‘Liberation Day’ tariff plan, which included a standard 10% duty on imports and higher rates for countries with large trade surpluses with the US, reflects a more protectionist stance from the US side. The implementation of these tariffs was temporarily put on hold for 90 days, until 9 July, providing a window for nations to negotiate a trade deal with the US and potentially avoid the imposition of higher tariffs. This temporary reprieve underscores the urgency for India and the US to reach a mutually agreeable trade deal before the deadline. In addition to the trade agreement, the article touches upon India's economic performance and its progress in reducing its fiscal deficit and debt-to-GDP ratio. Sitharaman stated that India is firmly on track to reducing its fiscal deficit, adhering to a consolidation roadmap established in 2021 following a pandemic-induced spike in spending. The commitment to bringing the deficit below 4.5% by 2026 demonstrates a focus on fiscal discipline and sustainable economic growth. The reduction in the debt-to-GDP ratio, from over 62% after the pandemic to 57.4% within four years, further highlights India's efforts to strengthen its macroeconomic fundamentals. This information provides a broader context for the trade negotiations, showcasing India's commitment to sound economic management and its attractiveness as a trading partner. The article effectively conveys the current state of negotiations between India and the US regarding a bilateral trade agreement, highlighting the progress made, the challenges faced, and the long-term goals. It also provides insights into India's economic outlook and its efforts to maintain fiscal stability.
Source: India, US progressing on bilateral trade agreement; first tranche expected by autumn: Sitharaman