What Has Been Agreed So Far

India and the United States issued a joint statement on February 7, 2026, finalising the framework of the first phase of the Bilateral Trade Agreement, also referred to as an interim trade agreement. Under this framework, President Trump agreed to reduce the reciprocal tariff on India from 25 percent to 18 percent, in recognition of India’s commitment to stop purchasing Russian Federation oil and to align with the US on addressing systemic trade imbalances.

The February framework included India’s commitment to eliminate or reduce tariffs on all US industrial goods and a wide range of agricultural products, including dried distillers’ grains, red sorghum, tree nuts, fresh and processed fruits, soybean oil, wine and spirits, and additional products. In return, the US agreed to work with India on resolving remaining tariff and non-tariff barriers through the broader BTA framework.

Commerce Minister Goyal stated on June 1 that “large parts” of the proposed trade agreement have been finalised, with both sides working through a few remaining details. He added that the deal would take into account the legal changes in the US tariff structure — a reference to the various tariff actions and modifications that the Trump administration has implemented since the February framework was agreed.

The Negotiating Teams

India’s delegation is being led by Darpan Jain, Additional Secretary in the Department of Commerce, who has served as New Delhi’s chief negotiator for the bilateral trade talks. The US team is led by Brendan Lynch, the designated chief negotiator for the India trade file. The four-day session is expected to cover the detailed legal text of the interim agreement, specific tariff reduction schedules, rules of origin provisions, and implementation timelines.

The two sides are also expected to advance discussions on the broader Bilateral Trade Agreement, which would go beyond the interim pact to cover areas including non-tariff measures, customs and trade facilitation, investment promotion, services, intellectual property, labour and environment standards, government procurement, and trade-distorting practices by state-owned enterprises.

Complications from New Tariff Proposals

The trade talks are taking place against the backdrop of a significant new development — the USTR’s proposal to impose additional 12.5 percent tariffs on India and 59 other countries over alleged failures to enforce forced labour import bans. This proposal, which emerged on June 3, could complicate the ongoing negotiations by introducing demands that go beyond the scope of the original trade framework.

Indian officials have privately expressed concern that the forced labour tariff proposal may be used as a negotiating tactic to extract additional concessions in the trade talks. The timing — announced just as negotiators from both sides are sitting across the table — has been seen by some trade analysts as a deliberate pressure tactic by the US side. However, it could also backfire by creating a hostile negotiating environment that makes it harder to close the remaining gaps in the interim agreement.

What the Deal Would Mean for Indian Businesses

If finalised, the interim trade agreement would be the first comprehensive trade pact between India and the United States, two economies whose bilateral trade exceeds $200 billion annually. For Indian businesses, the primary benefit would be more predictable and lower tariff rates for exports to the US, which is India’s largest export market. Key sectors that stand to gain include pharmaceuticals, information technology services, textiles, gems and jewellery, and chemicals.

For American companies, the deal would provide improved market access for agricultural products, manufactured goods, and potentially services in a market of 1.4 billion consumers. The agricultural provisions are particularly important for US farm interests, which have long sought greater access to the Indian market for products ranging from almonds and apples to dairy and poultry.

Industry bodies on both sides have urged their governments to move quickly toward finalisation. The Confederation of Indian Industry noted that “regulatory certainty and predictable trade rules are essential for businesses planning long-term investments” and that the interim agreement would provide a foundation for deeper economic integration. US business groups, including the US-India Business Council, have similarly advocated for a swift conclusion to the talks.

Timeline and Next Steps

If the current round of negotiations is successful in resolving the remaining details, the legal text of the interim agreement would need to undergo review by legal teams on both sides before it can be formally signed. On the Indian side, the agreement would require approval from the Union Cabinet. On the US side, the administration’s authority to implement tariff changes has been the subject of legal challenges, though the Supreme Court has largely upheld the executive branch’s trade authority.

Trade observers suggest that both sides have strong incentives to finalise the deal before the end of the current US political cycle, as bilateral trade agreements are often among the first casualties of changes in political leadership. The interim agreement would also serve as a confidence-building measure that could pave the way for the more ambitious comprehensive BTA, which is expected to take several years to negotiate fully.

The economic relationship between India and the US has deepened significantly in recent years, driven by growing technology partnerships, defence cooperation, and people-to-people ties. A successful trade agreement would add an economic foundation to this multidimensional relationship and potentially position India as a key partner in US efforts to diversify supply chains away from China.

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India and Canada have agreed to conclude the long-awaited Comprehensive Economic Partnership Agreement by November 2026, marking a significant thaw in bilateral relations that had been strained over the past three years. The announcement came after Canadian Prime Minister Mark Carney described the proposed CEPA as a game changer for both nations following his meeting with Indian Commerce and Industry Minister Piyush Goyal on the sidelines of a bilateral trade and investment forum in Ottawa.

Minister Goyal, who is in Canada for a series of bilateral meetings and investor outreach sessions, said both sides had made substantial progress on key chapters of the agreement, including market access for goods, services trade, investment protection, digital commerce and intellectual property rights. The minister indicated that the political will to conclude the deal exists on both sides and that negotiators have been tasked with resolving remaining contentious issues within the agreed timeline.

What the CEPA Covers and Why It Matters

The India-Canada CEPA is envisioned as a comprehensive trade agreement covering goods, services, investment, government procurement, competition policy and sustainable development. Bilateral trade between India and Canada stood at approximately 8.3 billion US dollars in the fiscal year 2025-26, a figure that both governments believe can be tripled within five years of the agreement coming into force.

For India, the CEPA opens significant opportunities in Canada’s services sector, particularly in information technology, professional services and education. Indian IT companies have been seeking improved market access in Canada, and the CEPA is expected to include provisions for temporary movement of professionals, mutual recognition of qualifications and simplified visa procedures for business travellers. The agreement could also boost Indian pharmaceutical exports to Canada, which currently face regulatory barriers that limit market penetration.

Canada stands to benefit from improved access to India’s large and growing consumer market, particularly in sectors such as clean energy technology, agricultural products, mining equipment and financial services. Canadian investors have been keen to participate in India’s renewable energy expansion, and the CEPA is expected to include robust investment protection provisions that would encourage greater Canadian foreign direct investment in Indian clean energy projects.

Goyal Woos Canadian Investors in Clean Energy and AI

During his visit, Minister Goyal held a series of bilateral meetings with Canadian business leaders to discuss investment opportunities in India across multiple sectors. The minister specifically invited Canadian companies to partner with India in clean energy, artificial intelligence, critical minerals processing and advanced manufacturing, highlighting the Indian government’s Production Linked Incentive schemes and the newly expanded National Green Hydrogen Mission as key investment attractors.

The clean energy pitch is particularly timely given the global push for energy transition and India’s ambitious target of achieving 500 gigawatts of non-fossil fuel energy capacity by 2030. Canada, which possesses significant reserves of critical minerals essential for battery production and renewable energy equipment, could become a key supply chain partner for India’s green industrialisation agenda.

On the artificial intelligence front, Goyal highlighted India’s emergence as a global AI talent hub and invited Canadian tech companies to establish research and development centres in India. The minister pointed to the recent announcement of global conversations around AI governance as evidence that India and Canada could collaborate on developing ethical AI frameworks that balance innovation with responsible deployment.

Diplomatic Reset After Years of Tension

The acceleration of CEPA negotiations represents a broader diplomatic reset between India and Canada, which saw relations deteriorate sharply in 2023 over allegations by Canada regarding Indian government involvement in the killing of a Sikh separatist leader on Canadian soil. India denied the allegations and expelled Canadian diplomats, leading to a significant downgrade in bilateral engagement that affected trade talks, educational exchanges and people-to-people contact.

The election of Mark Carney as Canadian Prime Minister earlier in 2026 provided an opportunity for both sides to recalibrate the relationship. Carney, a former Governor of the Bank of Canada and the Bank of England, has taken a more pragmatic approach to India relations, emphasising economic engagement and mutual interests over political disputes. His description of the CEPA as a game changer signals a clear intention to prioritise the trade relationship as the centrepiece of the bilateral reset.

Indian diplomatic sources indicate that while sensitive political issues have not been entirely resolved, both governments have agreed to compartmentalise these matters and allow the economic relationship to move forward independently. The Quad Foreign Ministers’ meeting in New Delhi earlier this week, which included discussions on supply chain resilience and critical minerals, also provided a multilateral backdrop for the India-Canada bilateral engagement.

Industry Reactions and Market Impact

Indian industry bodies have welcomed the CEPA timeline, with the Confederation of Indian Industry describing the agreement as potentially transformative for small and medium enterprises seeking to expand into the North American market. The Federation of Indian Export Organisations said the CEPA could add 3 to 4 billion US dollars in annual merchandise exports to Canada within the first three years, particularly in textiles, gems and jewellery, automotive components and processed food products.

The Indian stock markets, which have been navigating global uncertainties related to the Iran situation and crude oil price volatility, could receive a positive boost from the CEPA announcement as it signals diversification of India’s trade partnerships beyond traditional partners.

However, some domestic industry groups have expressed concerns about the impact of increased Canadian agricultural imports, particularly pulses and oilseeds, on Indian farmers. The government has indicated that the CEPA will include appropriate safeguards and transition periods for sensitive agricultural products to ensure that Indian farming interests are protected.

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