US-India Trade Deal 'Not Too Distant' US Commerce Secretary Lutnick expressed optimism about a forthcoming trade deal, citing strong ties between President Trump and PM Modi.

Washington, June 7 — The long-awaited trade agreement between the United States and India appears to be edging closer to finalization, with US Commerce Secretary Howard Lutnick expressing optimism on Thursday. Speaking at an industry summit, Lutnick noted that a comprehensive trade deal is “not too distant,” pointing to the robust personal relationship between former President Donald Trump and Indian Prime Minister Narendra Modi as a significant catalyst for progress.

Strengthening Economic Ties

Lutnick's remarks come at a time when bilateral trade between the two nations has reached record highs. “There’s tremendous goodwill between the US and India, both at the political level and within the business community. I firmly believe we’re approaching a historic deal that will benefit both sides,” Lutnick said during the annual US-India Business Council (USIBC) forum.

The US and India have seen their economic relationship deepen substantially over the last decade. In 2024, bilateral trade surpassed $200 billion for the first time, reflecting strong demand across sectors including technology, defense, pharmaceuticals, and clean energy.

Historical Context and Roadblocks

Despite multiple rounds of negotiations in recent years, a comprehensive trade pact has remained elusive. Differences have lingered over tariffs, market access for agricultural goods, intellectual property rights, and digital data regulations.

However, Lutnick suggested that much of the heavy lifting had already been done. “The frameworks are largely in place. What’s left are technical details — and the political will is clearly present,” he stated.

An unnamed Indian official echoed Lutnick’s sentiment, telling The Economic Mirror, “We are hopeful. The tone from Washington is encouraging, and we are seeing a convergence on many fronts.”

Analyst Reactions and Market Context

Market analysts reacted positively to the renewed trade optimism. Neil Patel, Senior Economist at TradeTrack Global, said, “This could be a game-changer, especially for sectors like defense manufacturing, semiconductor exports, and green energy. A comprehensive deal would unlock new growth avenues and reduce trade friction.”

US tech giants like Apple, Amazon, and Google have already been expanding their India operations in anticipation of regulatory easing. Likewise, Indian IT firms, such as Infosys and TCS, stand to gain from relaxed visa norms and greater market access.

Stock markets also responded mildly to the news. The Dow Jones Industrial Average ticked up by 0.3% while the BSE Sensex gained 112 points, with traders citing geopolitical stability and improving investor sentiment as key factors.

Strategic Implications

Beyond economic interests, the US-India trade deal has broader geopolitical implications. Both countries are key players in the Indo-Pacific strategy aimed at counterbalancing China’s rising influence. A robust trade relationship is seen as a foundational pillar for deeper military and strategic cooperation.

“The timing couldn’t be more important,” said Dr. Meera Chand, geopolitical analyst at the Institute for Strategic Affairs. “With elections concluded in India and a potential Trump re-election campaign looming, both governments are motivated to secure a landmark deal.”

What’s on the Table

According to trade insiders, the proposed deal may include:

• Reduction of US tariffs on Indian steel and aluminum.

• Greater market access for US dairy and agricultural exports.

• Expanded H-1B visa quotas for Indian professionals.

• Joint investments in AI, green tech, and semiconductor production.

• Easing of India’s data localization policies in exchange for digital trade cooperation.

While no firm timeline has been announced, Lutnick’s comments suggest that the groundwork is nearly complete. “We may be just months away,” he hinted, adding that both nations are working with a sense of urgency.

Investor Outlook

Investors are increasingly bullish on the India-US growth story. “Any trade agreement will serve as a strong signal to global investors that India is serious about market reforms and that the US sees India as a strategic economic partner,” said Tanvi Khanna, an emerging markets strategist at JPMorgan Asia.

Sectors expected to benefit include:

• Technology: More cross-border collaboration and smoother data regulations.

• Defense: Increased US arms exports and joint production projects.

• Pharmaceuticals: Streamlined regulatory approvals and access to US healthcare markets.

• Renewable Energy: Boost in solar and hydrogen partnerships.

Khanna added, “This deal could become a cornerstone of India’s aspiration to become a $5 trillion economy.”

While final hurdles remain, the optimism from Washington is a welcome signal for stakeholders on both sides. As the global economic order continues to shift, a strong and enduring US-India trade partnership could offer a stabilizing influence, unlocking mutual prosperity and reinforcing democratic alliances.

As Lutnick concluded in his address: “The US and India are natural partners. Our destinies are linked—not just economically, but strategically. Let’s seize this moment.”