America The first phase of the trade agreement (BTA) between India and America can be finalized only after the investigation under Section 301 is completed. A government official gave this information on Monday. The official said that if America wants to impose any additional tariff on India, then it will have to complete the investigation process started under Section 301. It is important to complete this process by July 24, because after that the 10 percent temporary additional tariff imposed by the US will end and only ‘Most Favored Nation’ (MFN) tariffs will remain in effect.
USTR had started investigation against many countries including India in March
In March, the US Trade Representative (USTR) had initiated a unilateral investigation under Section 301 in two cases against several countries, including India. These investigations focus on issues related to alleged forced labor and ‘excessive production capacity’ in global supply chains. On June 2, the US Trade Representative had proposed to impose 12.5 percent tariff on 54 countries including India. These tariffs were said to be imposed for failing to effectively ban the import of products made from forced labour. However, the report of the second investigation related to ‘excessive production capacity’ is yet to come.
The first phase may be finalized by mid-July
Meanwhile, India is seeking to impose lower tariffs than its competitor countries such as the ASEAN group, Sri Lanka and Bangladesh. Last week, Commerce and Industry Minister Piyush Goyal had said that both the countries are moving towards resolving the pending issues of the interim trade agreement and the first phase could be finalized by mid-July. An American team visited India between June 2 and 4 to discuss the trade deal.
America to be India’s second largest trading partner in 2025-26
A high-level US delegation led by Jameson Greer is also likely to visit India later this month. America was India’s second largest trading partner in the financial year 2025-26. During this period, India’s exports to America increased by 0.92 percent to $87.3 billion, while imports increased by 15.95 percent to $52.9 billion.
