India-US trade negotiations have reached an advanced stage, with sources in the Ministry of External Affairs indicating that a bilateral trade agreement could be finalised imminently.

This development follows closely on the heels of India's landmark Free Trade Agreement with the European Union, described as the 'mother of all deals'. Officials describe the remaining tasks as merely 'dotting the Is and crossing the Ts', underscoring the robustness of recent talks.

Even as diplomats wrapped up the EU pact, parallel discussions with the United States progressed significantly. The momentum suggests that New Delhi and Washington are poised for a swift closure, potentially marking another major win for India's trade diplomacy.

US President Donald Trump voiced optimism about the deal during the World Economic Forum in Davos on 21 January. Speaking to Moneycontrol after his address at the 56th Annual Summit, he praised Prime Minister Narendra Modi as a 'fantastic man and a friend', adding that the two nations are 'going to have a good deal'.

India's Commerce Secretary Rajesh Agrawal echoed this sentiment earlier, stating that the first tranche of the Bilateral Trade Agreement (BTA) is 'very near', though he refrained from specifying a timeline. The BTA was formally proposed in February 2025, following directives from the leadership of both countries.

The agreement aims to more than double bilateral trade, expanding from the current USD 191 billion to USD 500 billion by 2030. Talks were first announced during Prime Minister Modi's visit to Washington in February 2025, building on longstanding economic ties.

The Ministry of External Affairs confirmed on 9 January that both sides have held multiple rounds of negotiations since 13 February last year. These efforts have focused on crafting a balanced and mutually beneficial pact.

US Trade Representative Jamieson Greer commented positively on India's EU deal during a Fox News interview on Tuesday. He noted that India appears to have emerged on top, gaining enhanced market access to Europe and potentially expanded mobility provisions for its workers.

Greer highlighted India's competitive edges, including low-cost labour and a burgeoning manufacturing base. He suggested that provisions discussed by EU Commission President Ursula von der Leyen could facilitate greater mobility for Indian professionals into European markets, positioning India for a 'heyday'.

On the sensitive issue of India's purchases of Russian oil, Greer acknowledged progress but urged further reductions. He mentioned frequent contact with his Indian counterpart and recent US Treasury sanctions, expressing expectation that India will continue to wind down these imports despite the discounts involved.

Greer's remarks reflect broader US pressures on global trade partners amid geopolitical tensions. Nonetheless, the constructive tone indicates that the oil issue has not derailed the BTA talks.

With the EU agreement now concluded, the India-US BTA looms as the next potential blockbuster announcement. This dual success could bolster India's position in global trade architecture, enhancing its leverage in South Asia and beyond.

The timing aligns with India's strategic push for indigenous manufacturing and defence modernisation, areas where deeper US ties could unlock technology transfers and supply chain integrations. For the defence sector, in particular, reduced tariffs might ease access to critical components for aerospace and missile systems.

Observers anticipate that the BTA will address key sticking points such as intellectual property, digital trade, and agricultural barriers. India's recent EU negotiations, which navigated similar hurdles, may have honed strategies applicable here.

Prime Minister Modi's personal rapport with President Trump, evident in Davos, has evidently greased the wheels. This relationship, forged through prior summits, underscores the leadership-driven nature of these high-stakes pacts.

For US businesses, the deal promises greater entry into India's vast consumer market, spanning electronics, pharmaceuticals, and energy. Reciprocally, Indian exporters stand to benefit from eased US tariffs on textiles, gems, and IT services.

Geopolitically, the BTA reinforces the Indo-US strategic partnership amid rising tensions with China. It complements initiatives like the Quad and iCET, potentially accelerating collaborations in semiconductors and defence tech.

Challenges remain, including US concerns over non-tariff barriers and data localisation. Yet, sources emphasise the 'robustness' of recent rounds, suggesting compromises are in place.

India's deft handling of the EU deal—securing market access while safeguarding sensitive sectors—serves as a blueprint. US Trade Representative Greer's candid praise validates this approach.

As final tweaks occur, all eyes are on New Delhi for the announcement. A breakthrough would cap a transformative month for Indian commerce, signalling resilience in multilateral negotiations.

The BTA's scale, targeting USD 500 billion in trade, dwarfs many existing pacts. Achieving this by 2030 would require sustained momentum in investment and services trade.

In the defence and aerospace realms, where India prioritises self-reliance via Atmanirbhar Bharat, the deal could streamline procurement from US firms like Boeing and Lockheed Martin. This aligns with ongoing indigenisation efforts at HAL and DRDO-linked entities.

Broader implications extend to energy security, with US nudges on Russian oil potentially pivoting India towards American LNG supplies. This shift supports New Delhi's diversification strategy.

The impending deal exemplifies India's multi-alignment in trade, balancing Western partnerships with strategic autonomy. Sources predict closure 'any day now', heralding a new era of economic synergy.

Agencies