India and the US have tightened their positions on several key issues in the negotiations to sign a new trade agreement, The Economic Times reports, citing its sources.
The two countries have faced difficulties that, if not resolved, could complicate the conclusion of the deal. At a round of consultations held in New Delhi from June 5 to 10, India pressed for exemption from existing US sectoral tariffs on its steel and automobile exports and from rising duties on pharmaceuticals. The US, in turn, has demanded that India open its market to genetically modified crops, ease price controls on pharmaceuticals and relax rules on data localization on its local servers. India is nevertheless making major concessions in the negotiations in its willingness to reduce its most-favoured-nation tariffs, while the US is not proposing similar steps and insists on maintaining the US base tariff of 10% for all countries, according to Ajay Srivattava, head of the Delhi-based think tank Global Trade Research Institute. New Delhi intends to sign a comprehensive trade agreement with the US no later than from July 9, when the reprieve granted by President Donald Trump to increase US tariffs by 26% expires. It is expected to come into effect in 2026 after approval by the US Congress. India expects the first phase of this deal to come into effect this fall. The agreement envisages increasing the volume of trade between the two countries to USD 500 billion by 2030.