India-US trade deal talks may have reached a ‘plateau’, further concessions difficult: Nirmala Sitharaman

Finance Minister Nirmala Sitharaman has indicated that India and the United States may have reached a "plateau" in their ongoing trade pact talks, suggesting further concessions from either side could be challenging. Speaking at the Munich Leaders meeting, Sitharaman stated that negotiations have been rigorous and that both countries might be at a point where additional give-and-take becomes difficult. However, she also noted that progress could still be made if both sides can find room for further negotiations.

The US has been seeking to reduce its trade deficit with India, aiming to compensate for losses incurred over the years, according to Sitharaman. The finance minister explained that the US may view this issue similarly to how it might approach China's trade imbalance. In 2025-26, India's goods trade surplus with the US was approximately $34.4 billion, while its trade deficit with China was around $112-113 billion.

Sitharaman also pointed out that the US is increasingly using tariffs as a means to address its trade imbalance, beyond traditional negotiations. She emphasized that tariff application comes within a certain framework and questioned the extent to which it can be used as a tool for addressing trade imbalances.

Despite ongoing negotiations aimed at finalizing an interim trade agreement, US President Donald Trump signed legislation in recent weeks that allows for the imposition of tariffs up to 100% on countries purchasing substantial amounts of Russian oil, including India. This development adds another layer of complexity to the India-US trade talks.

Sitharaman also touched upon India's successful negotiation of the India-European Union Free Trade Agreement, which is set to be signed in December. She referred to this agreement as the "mother of all deals," given its scope and significance. The finance minister highlighted that the agreement will cover a significant portion of global trade and GDP, demonstrating India's adeptness in negotiating and finalizing trade deals.

Regarding bilateral investment treaties, Sitharaman announced that a new template is ready and expected to receive cabinet approval soon. She emphasized the government's focus on bilateral investment protection, noting that several agreements have been signed in recent years, including one with Saudi Arabia. These agreements incorporate more stringent elements to benefit investors from both parties.

Additionally, negotiations with Canada have commenced, with the hope of concluding similar agreements with Canada and potentially other countries, including Russia, in the near future.