India, US set the stage for trade talks with fresh roadmap in hand

India and the United States have moved a step closer to a comprehensive trade deal after finalising the Terms of Reference (TOR) that will guide upcoming negotiations. The announcement was made in a joint statement after US Vice President JD Vance met Prime Minister Narendra Modi during his visit to India.Ambassador Jamieson Greer, the US Trade Representative, confirmed the development. “I am pleased to confirm that USTR and India’s Ministry of Commerce and Industry have finalised the Terms of Reference to lay down a roadmap for the negotiations on reciprocal trade,” he said in a statement released by the Office of the United States Trade Representative.Greer noted the need for balance in the trade relationship. “There is a serious lack of reciprocity in the trade relationship with India. These ongoing talks will help achieve balance and reciprocity by opening new markets for American goods and addressing unfair practices that harm American workers,” he added.Diplomatic outreach and cultural symbolismThe announcement followed a high-profile diplomatic visit by Vice President Vance, who travelled with his wife Usha Vance and their three children. Usha Vance, whose parents emigrated from southern India in the 1970s, is the first Hindu spouse of a US president or vice president.On X, Vance posted: “It was an honour to see Prime Minister Modi this evening. He's a great leader, and he was incredibly kind to my family. I look forward to working under President Trump's leadership to strengthen our friendship and cooperation with the people of India!”The Vance family visited Akshardham Temple in Delhi before heading to Jaipur. A visit to the Taj Mahal in Agra is also part of the itinerary.Greer welcomed the joint statement from Vance and Modi, calling it a reaffirmation of the India-US COMPACT.The bigger picture: Trade, tariffs and strategic plansThe Bilateral Trade Agreement is part of the broader Catalysing Opportunities for Military Partnership, Accelerated Commerce & Technology (COMPACT) programme, which began in February 2025. It seeks to strengthen both defence ties and economic engagement through coordinated policies on trade, supply chains, and technology transfer.The TOR was finalised following a meeting between President Trump and PM Modi earlier this year. According to the US, the agreement outlines key areas of cooperation including market access, regulatory standards, and a framework to promote supply-chain integration.While there is no timeline yet for a final deal, both governments have signalled urgency. A joint release noted that the BTA “presents an opportunity to negotiate a new and modern trade agreement focused on promoting job creation and citizen well-being in both countries.”It added that the agreement is “guided by their respective visions of ‘Amrit Kaal for India’ and ‘Golden Age for America’” and could “create new opportunities of growth for workers, farmers, and entrepreneurs in both countries.”Rising tariffs and looming deadlinesIndia is facing growing pressure from the Trump administration’s reciprocal tariffs. On 2 April, the United States announced a 26% tariff on Indian imports, as part of its broader trade overhaul. This comes on top of a new 10% baseline tariff on all US imports that took effect on 5 April.Although reports initially suggested a 27% tariff for India, USTR later clarified it would be 26%. Several sectors, including pharmaceuticals, semiconductors, copper, and key energy commodities like oil, coal and LNG, are currently exempt.The backdrop to these negotiations is a $45.7 billion trade deficit that the US recorded with India in 2024—up 5.1% from the previous year. The US government has pointed to this gap, along with restricted market access, as key concerns driving the new tariff regime.Without an agreement, Indian goods face the full 26% tariff starting July. A similar pressure is being applied to other US trade partners, including Japan, South Korea, and the United Kingdom, as part of President Trump’s efforts to renegotiate multiple trade relationships.Speaking at the White House Easter Egg Roll, President Trump told reporters, “I think they’re going very well. We’re going to make a lot of money. We’re already [levying] 25% on cars and aluminium and steel. Taking in a lot of money, more money than this country’s seen. And that’s just the beginning.”While the White House said talks with other countries were also progressing, it offered no timeline for a final India deal. A source close to the administration told The Post, “The spin is out of control… can’t tell what is cope and what is optimism.”Still, officials maintain that India is among the top priorities for a tailored agreement. Negotiations with Japan, South Korea, and Vietnam are also in the pipeline, though none have yet reached a formal conclusion.Personal diplomacy and broader themesVice President Vance’s visit was not just political—it carried personal and cultural significance. The family’s stop in Jaipur and their temple visit were seen as gestures of goodwill. Union minister Ashwini Vaishnaw received them at Delhi airport, underlining the importance of the visit.Talks during the meeting between Modi and Vance also touched on wider strategic issues, including the upcoming Quad summit, which India will host later this year. Modi said he looked forward to welcoming President Trump for the event, although the US readout of the meeting did not mention a confirmed visit.For now, the path ahead remains open, but uncertain. Negotiators on both sides have a framework, a deadline, and mounting political pressure. What they do with it may well shape the next chapter of India-US relations.