India-US Trade Deal: First Phase Finalised, and How India Signs Trade Agreements

The India-US Bilateral Trade Agreement (BTA) is a trade deal that India and the United States are negotiating to make it cheaper and easier to sell goods and services to each other. It works by cutting import taxes (tariffs), removing other trade hurdles and strengthening supply chains. It is being built in stages, called tranches, and the first tranche is an interim agreement on the way to the full BTA.

Treaty-making power is the power of a country to enter into binding agreements with other countries, such as trade deals, border agreements, tax treaties and climate agreements. In India, this power belongs to the Union executive: the Union government, acting in the name of the President, negotiates, signs and ratifies treaties. Parliament's approval is not required to sign or ratify a treaty. But if a treaty needs a change in Indian law to be carried out, only Parliament can make that law.

A Free Trade Agreement (FTA) is a deal between two or more countries to remove or sharply cut import taxes on most of the goods they trade with each other, while each keeps its own taxes for countries outside the deal. Because it treats partners better than others, it is an exception to the WTO's basic rule of equal treatment. Countries often sign a smaller interim or early harvest deal first, and then move to the full agreement.