India US BTA: India’s preparations for trade agreement intensified, may demand relaxation in technology sector from America

New Delhi| India has intensified preparations for talks on the ongoing Bilateral Trade Agreement (BTA) with the US. It is being told that India may demand export control from America and equal relaxation in the technical field under the proposed Bilateral Trade Agreement (BTA) with major American allies like Australia, UK and Japan. Sources claim that India may seek relaxation for sectors like telecom equipment, biotechnology, AI (artificial intelligence), pharmaceuticals, quantum computing and semiconductors.

Sources reveal that under the agreement, India is also demanding duty concession for sectors like textiles, gems and jewellery, leather goods, apparel, plastics, chemicals, shrimp, oilseeds, chemicals, grapes and bananas. While the US wants duty concessions in sectors such as industrial goods, automobiles (electric vehicles), wine, petrochemical products, dairy, agricultural commodities such as apples and tree nuts.

The US has eased export controls to strengthen technology partnerships with close allies such as Australia, the UK and Japan, according to think tank GTRI. These changes have been made to ease cooperation in important areas. The US has simplified rules for sharing defense and dual-use technologies with Australia and the UK. As of one September 2024, nearly 80 percent of defense-related exports to these countries no longer require individual licenses under revised U.S. weapons regulations.

GTRI founder Ajay Srivastava said the US is keen to strengthen technical ties with India. This may be less than offering complete equality. US officials may point to ongoing concerns about India’s export controls, intellectual property protection, cyber security standards and military ties with Russia. The US may suggest mechanisms such as reliable partner programs, project-specific licenses or extended licensing exceptions for select Indian entities rather than blanket exemptions.

America is India’s largest trading partner
The U.S. remained India’s largest trading partner for the fourth consecutive year in 2024-25. Its bilateral trade stood at US$ 131.84 billion. The US accounts for about 18 per cent of India’s total commodity exports, 6.22 per cent of imports and 10.73 per cent of the country’s total commodity trade. India, along with the US, had a trade surplus in goods of $41.18 billion in 2024-25. It was $35.32 billion in 2023-24, $27.7 billion in 2022-23, $32.85 billion in 2021-22, and $22.73 billion in 2020-21. America has expressed concern over this increasing trade deficit.