No future tariffs, fair rates, end 'forced labour' probe: What India wants from US trade deal

India has outlined key demands in its ongoing trade negotiations with the United States, including preferential tariff treatment and assurances against future tariff hikes, as both countries work towards finalising an interim trade agreement, a trade official said on Monday.

A proposed bilateral trade agreement between India and the United States may only be finalised after Washington concludes its Section 301 investigations that alleged unfair trade practices, including concerns related to forced labour and excess industrial capacity in sectors such as textiles, the Indian trade official said. This centres around the Office of the United States Trade Representative (USTR) having named India among countries it believes follow unfair trade practices and has proposed additional tariffs of 10 to 12.5 per cent on imports.





India is also seeking clarity on proposed US tariff measures arising from these investigations, which Washington says are aimed at addressing practices it views as harmful to American industry. The official added that New Delhi is further seeking assurances that any deal would shield it from future additional tariff measures by the US. “Once we have that tariff, we can finalise a trade deal with the US. But obviously the rate has to be competitive with direct competitors,” the official, who spoke on condition of anonymity, told Reuters.

This comes amid efforts by New Delhi and Washington to conclude the first tranche of a bilateral trade agreement, which Commerce and Industry Minister Piyush Goyal last week said could be finalised by mid-July.

India and the US had reached an initial understanding on a trade deal in February. However, negotiations slowed after US President Donald Trump's sweeping tariff measures were struck down by the US Supreme Court.

According to the official, the US has since proposed an additional 12.5 per cent tariff on imports from India and several other countries over concerns related to the use of forced labour. Washington is also considering a separate tariff on Indian exports, citing excess capacity in industries such as textiles and alleging that Indian shipments are adversely affecting domestic US manufacturers.

Bilateral trade talks gathered pace last week when a US delegation led by Assistant US Trade Representative for South and Central Asia Brendan Lynch held three days of discussions with Indian trade officials in New Delhi.

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