India and the United States are set to finalize a joint statement on the first phase of their bilateral trade agreement within the next four to five days, Commerce Minister Piyush Goyal announced on Thursday, according to The Hindu.
Speaking to reporters, Mr. Goyal said the U.S. will reduce tariffs on Indian goods from 50% to 18% through a presidential executive order following the issuance of the joint statement. However, India will only be able to lower tariffs on American imports after a formal legal agreement is signed, which is expected by mid-March 2026.
"Meaningful talks are going on between India and the U.S. on the decisions that were announced by the leaders of the two countries," Mr. Goyal stated, as reported by The Hindu. "The first tranche of the Bilateral Trade Agreement is nearly ready."
Commerce Secretary Rajesh Agrawal, who served as the chief negotiator for the deal until his appointment in October 2025, explained the procedural differences between the two nations. "Their tariffs are executive tariffs [and so can be amended by executive orders]," Mr. Agrawal said. "Our tariffs are Most-Favoured Nation (MFN) tariffs that can only be cut after the legal agreement has been signed."
MFN tariffs are standard rates that World Trade Organisation members apply to goods from other member countries.
Regarding India's commitment to purchase $500 billion worth of goods from the U.S. over five years, Mr. Goyal outlined the country's anticipated needs. "When we estimated what we would need from the U.S., we came to a figure of at least $500 billion, which we can clearly see before our eyes as potential that we can import from the U.S. over the next 5 years," he said, according to The Hindu.
The minister highlighted that India's growth trajectory would require substantial imports of energy, data center equipment, information and communication technology products, and aircraft. Current and upcoming orders with Boeing alone are valued at approximately $70-80 billion, which could exceed $100 billion when engines and spare parts are included.
Mr. Agrawal added that India's current global imports of these critical items exceed $300 billion and are projected to reach over $2 trillion in the next five years. "If we are able to buy $500 billion from the U.S., this will only add to our diversification," he noted.
The announcements indicate significant progress in India-U.S. trade relations, with the phased approach allowing the U.S. to implement tariff reductions more quickly while India follows its domestic legal requirements for tariff modifications.