India-US Trade Deal Talks Reach a Plateau: Market Access and Agriculture Remain the Sticking Points
Talks between India and the United States on a trade deal have run into a few hard sticking points, mainly market access (how open each side keeps its market to the other's goods) and agriculture.
A research unit of the Fitch group said both sides still have "stubborn cards to play", meaning neither side is ready to give up its key demands yet.
The United States Trade Representative (USTR), the US official who leads trade talks, said both sides have now identified all the key issues that still need to be solved.
India's Finance Ministry said the negotiations have reached a plateau (a flat stage), where there is little room left for either side to give more concessions.
India wants more preferential access (lower tariffs than other countries get) for its exports to the US. The US wants more access to the Indian market, especially for its farm products.
The talks are part of the India-US Bilateral Trade Agreement process launched in February 2025. An interim framework was announced in February 2026, but the full deal is still not signed.
India-US Bilateral Trade Agreement (BTA)
The India-US Bilateral Trade Agreement is a trade deal that India and the United States are negotiating with each other. Its aim is to make it cheaper and easier for each country to sell goods and services to the other. It does this by cutting import taxes (tariffs), removing other trade hurdles and setting common rules. The US is one of India's largest trading partners and its largest export market for goods, so the deal matters a lot for Indian exporters.
The present deadlock is about the core of any trade deal: who opens how much of its market. India wants lower US tariffs for its exports, while the US wants India to open its farm sector further. Since India has drawn firm red lines on farm and dairy products, both sides find it hard to give more.
WTO Agreement on Agriculture (AoA)
The Agreement on Agriculture, or AoA, is the World Trade Organization's rulebook for farm trade. It limits how much a country can protect its farmers through import taxes, through subsidies paid at home, and through subsidies paid to push exports. It came into force with the WTO on 1 January 1995, as a result of the Uruguay Round of trade talks. Every WTO member, including India and the US, must follow it, and its rules shape what each side can ask for in a bilateral farm deal.
The US demand for greater access to India's agricultural market is exactly the "market access" pillar of farm trade. India's caution comes from the same concerns it raises at the WTO: protecting small farmers, food security and its MSP system. This is why agriculture remains one of the hardest issues in the India-US talks.
Free Trade Agreements: Concept and WTO Framework
A Free Trade Agreement (FTA) is a deal between two or more countries to remove or sharply cut import taxes (tariffs) on most of the goods they trade with each other. Each country still keeps its own tariffs for countries outside the deal. Many modern FTAs also cover services, investment, digital trade and rules on standards. The India-US BTA, once signed, would be one such preferential deal.
India is asking for "preferential access", which is the core benefit of an FTA: lower tariffs than other countries pay. The disagreement on how much each side should open shows why bilateral deals often take years and are first signed as interim or "early harvest" agreements.
- India-US BTA talks launched: 13 February 2025
- "Mission 500": target of USD 500 billion two-way trade by 2030
- Interim trade framework joint statement: 7 February 2026; US reciprocal tariff on Indian goods set at 18% under it
- US Supreme Court ruling against IEEPA tariffs: 20 February 2026 (6 to 3)
- Section 122 (US Trade Act of 1974) tariffs: capped at 15%, maximum 150 days
- Main sticking points (October 2026): market access and agriculture
- WTO AoA: in force 1 January 1995; de minimis 10% (developing), 5% (developed)
- Bali Peace Clause: 2013
- GATT Article XXIV: legal basis for FTAs and customs unions