India, US Say "A Lot of Work" Done as Interim Trade Deal Talks Continue

India and the United States are still negotiating the terms of their long-pending interim trade agreement, with the Ministry of External Affairs confirming on Tuesday that substantial progress has been made but that key issues remain unresolved.

WHAT WAS SAID

Briefing reporters in New Delhi, MEA spokesperson Randhir Jaiswal said the conversation between the two countries on the proposed bilateral trade agreement is ongoing and that {{both sides have done "a lot of work" toward finalisation}}. He added that a few issues still need to be settled before the interim agreement can be concluded, without specifying which ones.

The remarks came in response to questions about a fresh complication: a coalition of 25 US states, led by California Attorney General Rob Bonta, has filed a lawsuit in the [[US Court of International Trade|https://www.newkerala.com/news/a/conversation-between-india-us-interim-bilateral-trade-agreement-ongoing-477.htm]] challenging the Trump administration's latest round of Section 301 tariffs on the European Union and nearly 60 other countries, arguing the measures exceed the administration's legal authority. India was placed in a 10 percent tariff bracket under those July measures — lower than several other economies, but a reminder that Washington's tariff architecture keeps shifting even as the India-specific deal is being finalised.

HOW WE GOT HERE

The interim agreement traces back to a [[joint statement|https://www.whitehouse.gov/briefings-statements/2026/02/united-states-india-joint-statement]] issued on February 7, 2026, under which the US agreed to cut its reciprocal tariff on Indian goods from 50 percent to 18 percent, in exchange for India halting purchases of Russian crude and committing to reduce tariffs on US industrial and agricultural goods. India also pledged to purchase $500 billion worth of US energy, aircraft, technology and other products over five years, part of a broader "Mission 500" push to double bilateral trade by 2030.

What followed was meant to be a quick translation of that framework into a signed legal text. It has not been quick. Indian officials travelled to Washington in late February to begin drafting. A USTR delegation visited New Delhi from June 1–4 for further talks on goods, non-tariff measures and customs facilitation. USTR chief Jamieson Greer followed with his own visit from June 22–24, meeting Finance Minister Nirmala Sitharaman and Commerce Minister Piyush Goyal. By late June, US Ambassador to India Sergio Gor was telling reporters that only "1 percent" of the deal remained open.

That optimism didn't hold. In July, Greer returned to Delhi for what both sides had described as near-final talks — with some reports putting the deal at 99 percent complete — only for India to unexpectedly pull back before signing. The US delegation left without an agreement. Commerce Minister Goyal has maintained that India will not sign until terms are "fair, equitable and balanced," and has repeatedly ruled out concessions on agriculture, dairy and other politically sensitive sectors — a red line Indian negotiators have held since talks began.

WHAT'S STILL UNRESOLVED

The sticking points, according to reporting through the negotiation, have clustered around a handful of issues: US access to India's agriculture and dairy markets, which India has kept off the table to protect farmer livelihoods; India's continued oil purchases from Russia, which by mid-2026 had climbed to record volumes rather than fallen as the February framework anticipated; and India's reported interest in an automatic review clause or sunset provision that would let it revisit tariff concessions if US trade policy shifts again — a hedge against exactly the kind of unpredictability the Section 301 tariffs and the states' lawsuit now illustrate.

WHAT COMES NEXT

Neither government has set a new public deadline. The MEA's Tuesday briefing was notably short on specifics — confirming momentum without confirming a timeline, a pattern that has held since the February framework was first announced. For now, the interim agreement remains what it has been for months: close, according to both sides, but not yet closed.