As India navigates escalating trade tensions with the United States, Union Commerce Minister Piyush Goyal remains hopeful about finalising a long-awaited Bilateral Trade Agreement (BTA) with the US by November 2025, despite recent setbacks and tariff hikes.
In a global investor conference this week, Goyal emphasised that discussions are ongoing. However, a scheduled US trade delegation visit on August 25 was postponed, and neither side has announced a fresh negotiation timeline.
📊 Impact of US Tariffs on Key Indian Export Sectors (FY2025)
| S. No. | Product Group | Exports to USA ($ bn) | US Share in India’s Exports (%) | US MFN Tariff (%) | New Trump Tariff (%) | Total Tariff Payable (%) | Impact on India |
|---|---|---|---|---|---|---|---|
| 1 | Shrimps | 2.0 | 32.4 | 0 | 50 | 60 | Very High (incl. 10% CVD) |
| 2 | Petroleum products | 4.1 | 4.3 | 6.9 | 0 | 6.9 | Low |
| 3 | Organic chemicals | 2.7 | 13.2 | 4 | 50 | 54 | Very High |
| 4 | Pharmaceuticals | 9.8 | 39.8 | 0 | 0 | 0 | Low |
| 5 | Carpets | 1.2 | 58.6 | 2.9 | 50 | 52.9 | Very High |
| 6 | Apparel: Knitted | 2.7 | 34.5 | 13.9 | 50 | 63.9 | Very High |
| 7 | Apparel: Woven | 2.7 | 32.2 | 10.3 | 50 | 59 | Very High |
| 8 | Textiles: Made-up articles | 3.0 | 48.4 | 9 | 50 | 59 | Very High |
| 9 | Diamonds, gold, and products | 10.0 | 40.0 | 2.1 | 50 | 52.1 | Very High |
| 10 | Steel, Aluminium, Copper | 4.7 | 16.6 | 1 | 50 | 51.7 | High |
| 11 | Machinery & Mechanical Equip. | 6.7 | 20.1 | 1.3 | 50 | 51.3 | Very High |
| 12 | Smartphones | 10.6 | 43.9 | 0 | 0 | 0 | Low |
| 13 | Vehicles & Parts (HS87) | 2.6 | 11.4 | 1 | 25 | 26 | Medium |
| 14 | Furniture & Bedding | 1.1 | 44.8 | 2.3 | 50 | 52.3 | Very High |
Total Goods Exports Affected: $86.5 billion (19.8% of India’s exports to the USA)
Source: GTRI Analysis of DGCI&S data and US tariff notifications
🧀 Dairy Sector Becomes a Cultural and Economic Flashpoint
Among all trade issues, dairy product access has become the most sensitive. The United States wants to export dairy items—milk, cheese, and ghee—to India, but the Indian government strongly resists:
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India requires certification that imported dairy is from 100% vegetarian sources
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US dairy often involves animal-derived enzymes like rennet, not accepted in India
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India fears these imports will devastate local small dairy farmers
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Cultural and religious objections further complicate approvals
On Independence Day, PM Modi reiterated: “India will not compromise the interests of its farmers, fishermen, and livestock producers.”
🎯 $500 Billion Trade Goal May Be at Risk
Despite the discord, both governments have pledged to double bilateral trade to $500 billion by 2030. Current figures show strong momentum:
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Exports to US (Apr–Jul 2025): $33.53 billion (↑21.64%)
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Imports from US: $17.41 billion (↑12.33%)
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TotalTrade: $12.56 billion (US remains top trading partner)
Yet, unless the tariff tensions and the dairy import dispute are resolved soon, progress toward this goal could be severely delayed.