India-US trade talks on track as both sides aim to resolve tariffs, oil purchases, H-1B fees

Trade talks between India and the US are on track and have led to greater understanding between the two countries, but the objective would be to find a comprehensive solution to all issues including tariffs and purchase of Russian crude oil, sources close to the development said. Commerce and Industry Minister Piyush Goyal and a team of senior officials including Rajesh Agrawal, special secretary, department of commerce and chief negotiator, are in the US this week to try and take forward the negotiations for a bilateral trade deal. 
 
Goyal’s visit to the US comes soon after US trade negotiator Brendan Lynch, who is the Assistant US Trade Representative for South and Central Asia, visited New Delhi and held day-long discussions with Agrawal on September 16.
 
Sources have indicated that this is not the sixth round of trade negotiations but both countries are hopeful of concluding the trade deal at the earliest. “These discussions are on at a high level. Negotiator level talks will be held later,” they explained. 

India and the US were hoping to clinch the first tranche of the bilateral trade agreement by fall this year.
 
 For the US, India’s purchase of Russian crude oil continues to be a key concern and sources said that discussions around this are still ongoing. The US has imposed a 25% penalty tariff on India for continuing to purchase crude oil from Russia, which it believes has been a source of financing the war on Ukraine. Along with the 25% reciprocal tariff, this has taken the total tariff on India to 50%, which is the highest on any country apart from Brazil.
 
Addressing the US-India Strategic Partnership Forum, Goyal has indicated that India may purchase more crude oil from the US.
 
Sources, however, underlined that the recent hike in the fee on the H1B visa by the US is not aimed at India alone. “This is a completely unrelated issue and is aimed at the whole world, not just at India. But with 20% of the world’s population, India is the most impacted. The intent of the H1B visa fee hike was not to target India,” the source explained. The US continues to remain open to high level skilled workers.
 
However, Indians accounted for over 70% of H-1B visa recipients in FY24 and the move is seen to impact the country’s IT sector the most.