India will proceed with signing a bilateral trade agreement with the United States only after Washington finalises its revised tariff structure, Commerce Secretary Rajesh Agrawal said on Monday, signalling a delay in the anticipated timeline for the deal.
Speaking at a press briefing, Agrawal indicated that negotiations between the two sides remain ongoing, but any formal signing would depend on the completion of the United States’ new tariff architecture. He clarified that there was no impasse in discussions, noting that the agreement would move forward once the revised framework is in place.
The delay follows a ruling by the Supreme Court of the United States earlier this year, which struck down certain executive powers used by Donald Trump to impose tariffs. Agrawal explained that the decision effectively invalidated previous tariff measures, compelling the US administration to formulate a fresh tariff regime for global trade.
In the interim, tariffs are being levied under Section 122, a temporary provision expected to remain in effect for up to five months, adding an element of uncertainty to trade negotiations.
Agrawal also highlighted that ongoing geopolitical tensions in West Asia, particularly involving the United States, Israel and Iran, could disrupt India’s trade flows with the region. He noted that logistical challenges—especially in maritime shipping and air cargo—are already affecting the movement of goods, with implications for both exports and imports.
He further stated that while some impact on trade volumes is anticipated, it is unlikely to result in a significant decline, as diplomatic efforts to stabilise the situation are ongoing.
The government is currently evaluating potential support measures for exporters affected by disruptions in West Asia, with announcements expected in the coming days. Despite near-term challenges, Agrawal said India remains on track to achieve total goods and services exports of approximately US $860 billion.
He added that authorities would seek to offset any decline in shipments to West Asia by expanding exports to alternative markets, with the aim of maintaining positive growth in merchandise exports compared to the previous fiscal year.
