US says trade deal with India is 'very, very close'. What's holding it up? | WION Decodes

US Deputy Assistant Secretary in the Bureau of South and Central Asian Affairs Bethany Poulos Morrison on Tuesday (Jun 23) said that Washington was "very, very close" to concluding the historic trade agreement with India. Speaking at an event, Morrison said, "Looking at trade, in February 2026, we announced the intention to finally conclude the historic trade deal. We are very, very close." This comes after months of negotiations.

But if a deal is so close, why hasn't it been signed yet? And what exactly are India and the US negotiating? WION Decodes.

What is the deal being discussed between India and the US?

The talks between the two allies revolve around an interim trade agreement that could eventually pave the way for a broader Bilateral Trade Agreement (BTA). Both countries have set a target of reaching $500 billion in bilateral trade by 2030, a goal often referred to as "Mission 500".

For Washington, the deal is about gaining greater access to India's vast consumer market. For New Delhi, it is about securing market access, reducing trade frictions and strengthening economic ties with its largest trading partner.

Why does the US say the deal is important?

According to Morrison, the agreement would open India's market of 1.4 billion people to American goods on what Washington calls "reciprocal and mutually beneficial" terms. "The administration is driving towards the goal of Mission 500, 500 billion in trade by 2030, with a real sense of urgency," she added.

What are the sticking points?

The US has long argued that India maintains high tariffs and regulatory barriers on several imported products, ranging from agricultural goods to manufactured products.

Successive American administrations, including the current Donald Trump administration, have pushed for greater market access, but negotiations have often stalled over disagreements on tariffs, digital trade rules and market protections.

While neither side has publicly disclosed the final negotiating text, several issues have repeatedly emerged during trade discussions.

These include:

• Tariffs on agricultural and industrial products
• Market access for American goods
• Digital trade and data regulations
• Rules affecting pharmaceutical and medical products
• Investment protections
• Non-tariff barriers affecting exporters

India has traditionally sought to protect sensitive sectors such as agriculture, while the US has pushed for broader access for its companies.

Why is there a sense of urgency now?

The timing is significant. The US is trying to diversify supply chains away from China while deepening economic partnerships with trusted partners in the Indo-Pacific.

India, meanwhile, is positioning itself as an alternative manufacturing hub and a key destination for global investment.

The economic relationship is already expanding rapidly. According to Morrison, 2025 was a "historic year" for India-US trade. "We raised bilateral trade for goods to 149 billion. That's more than a 20 million increase from 2024. US exports to India alone rose by 9.8 per cent," she said.

What happens next?

US Trade Representative Jamieson Greer and Commerce Minister Piyush Goyal met in New Delhi on Tuesday to advance discussions on both the interim agreement, which was originally launched by President Trump and Prime Minister Modi, and the larger trade framework.

In a statement on X, the official account of the US Embassy in India on X said that it remains focused on securing a fair, reciprocal trade deal that opens markets for American exporters and delivers benefits to both nations.

"USTradeRep Jamieson Greer and Indian Minister of Commerce and Industry Piyush Goyal met in New Delhi today to advance negotiations on the Interim Agreement launched by President Trump and Prime Minister Modi. The United States remains focused on securing a fair, reciprocal trade deal that opens markets for American exporters and delivers benefits to both nations," the post read.