India and the US are expected to finalise and sign a joint statement on the first tranche of the bilateral trade agreement in 4-5 days, Commerce and Industry Minister Piyush Goyal said on Thursday. After the joint statement is signed, the US will come out with an executive order on reducing tariffs on India to 18 per cent. At present, Indian goods attract a 25 per cent reciprocal tariff and a 25 per cent additional tariff for buying Russian crude oil.
Goyal told reporters that a legal agreement for the first tranche of the pact is expected to be signed by mid-March. The joint statement will be followed by an exhaustive legal agreement, he said.
Goyal also said that there is no investment commitment in this pact. Once the statement is signed, it will be converted into a legal agreement and mid-March, "We are hopeful of signing that legal agreement," Commerce Secretary Rajesh Agrawal said.
The signing of the legal text will lead to a cut in tariffs by India on certain US goods.
Earlier, Trump and Prime Minister Narendra Modi had agreed at a meeting in February last year to finalise the first tranche of a bilateral trade agreement by the autumn.
Though the two sides held several rounds of negotiations, forward movement on the trade deal stalled after Trump imposed 50 per cent tariffs on Indian goods, including the 25 per cent punitive tariffs for India's procurement of Russian crude oil.
The Modi-Trump phone talks came on a day External Affairs Minister S Jaishankar travelled to Washington DC.
India now has a lower tariff compared to competing export economies, officials said.
They cited 19 per cent American tariffs on Indonesia, 20 per cent on Vietnam, 20 per cent on Bangladesh and 34 per cent on China.
Official sources last week said India and the US have made "very significant" progress in the negotiations for the trade deal.
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