Boosting Commerce: US-India Trade Pact Poised to Reverse Headwinds

The potential for a successful US-India bilateral trade agreement is on the horizon, as highlighted by a finance ministry report on Tuesday. The agreement could transform current economic headwinds into tailwinds, broadening market access and invigorating exports.

Negotiations are underway, with a tentative interim agreement anticipated before July 8. India is advocating for full exemption from the 26% reciprocal tariff imposed on its goods by the US, which, although suspended for 90 days, remains a point of contention alongside a persistent 10% baseline tariff.

According to the report, India retains its status as a promising investment destination, buoyed by strong domestic fundamentals and macroeconomic management. The IMF projects India's 2025-26 GDP growth at 6.2%, underscoring its resilience amid global uncertainties and trade tensions. Consumption and government capital expenditure play critical roles in this economic fortitude.

(With inputs from agencies.)