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Marco Rubio's India visit comes amid efforts to resolve outstanding issues in the proposed bilateral trade agreement. (Images: X)
Washington DC/New Delhi: The United States is nearing a trade agreement with India, Secretary of State Marco Rubio has indicated, raising expectations of a breakthrough in bilateral economic negotiations ahead of his visit to New Delhi. Speaking during his visit to Central Asia on Monday, Rubio said Washington was close to finalising an agreement with India. He also linked broader trade negotiations to US decisions on sanctions waivers, highlighting the complex balance between economic interests, energy security and foreign policy.
“We are trying to finalise a trade deal with India right now. We are very close to doing that,” Rubio said ahead of his India visit scheduled for Tuesday. His remarks come as both countries work towards completing the initial phase of a broader trade agreement, with disagreements over market access, particularly in the dairy sector, remaining a key challenge.
The proposed agreement seeks to improve market access for businesses in both countries by reducing or adjusting tariffs on selected goods. Under a framework announced in February, the US reduced its reciprocal tariff on Indian goods from 25% to 18% and removed an additional 25% duty associated with India's purchases of Russian oil.
In return, India committed to eliminating or lowering tariffs on a range of American industrial and agricultural products. These include tree nuts, fruit, soybean oil, wine and spirits. The negotiations are aimed at creating more predictable trading conditions while expanding commercial opportunities for companies on both sides. However, reaching a final understanding will require both governments to resolve outstanding differences over sensitive sectors and the precise terms of market access.
Despite signs of progress, dairy market access remains one of the most significant outstanding issues in the negotiations. India's agricultural sector involves millions of farmers and dairy producers, making decisions on imports particularly sensitive. Any agreement involving these products must balance opportunities for trade with domestic economic and policy considerations.
Commerce and Industry Minister Piyush Goyal has previously indicated that the first tranche of the agreement had been finalised and was undergoing legal drafting. He also stressed the importance of ensuring clarity on India's competitive advantage before implementation. External Affairs Minister S Jaishankar has described the negotiations as approaching a “landing point”, suggesting that the two sides are moving closer to a possible understanding. However, the US Trade Representative, Jamieson Greer, said on October 2 that an agreement was not imminent, underlining the uncertainty surrounding the timeline.
Rubio's latest comments also brought India's energy requirements and purchases of Russian oil into focus. The US Secretary of State said Washington had issued sanctions waivers in recent months because of concerns about the effects on global energy supplies and prices. He explained that foreign policy decisions must account for different countries' circumstances, including geography and the availability of alternative energy sources. Rubio acknowledged that some countries face greater difficulties than others in replacing existing energy supplies, adding that these factors must be balanced when decisions involving national security waivers are made.
His remarks indicate that trade negotiations, energy security and sanctions policy are being considered within a wider strategic framework. US President Donald Trump has also signed an order implementing the Lindsey O. Graham Sanctioning Russia and Iran Act and waiving tariffs on buyers of Russian oil, according to the details provided in the report. For India, energy security remains an important consideration as it manages its relationships with major global powers while seeking stable and affordable supplies.
At its core, the proposed trade agreement involves reciprocal concessions. Washington is seeking improved access for American goods in India, while New Delhi wants more predictable tariff conditions for Indian exports to the US market. A successful agreement could help businesses plan exports and imports with greater certainty and potentially expand trade in selected sectors.
For Indian exporters, US tariff policy is especially important because the American market represents a major destination for merchandise shipments. For American companies, reduced Indian tariffs could create new opportunities in industrial goods and agriculture. The precise impact, however, will depend on the final terms, the products covered and the implementation schedule agreed upon by both governments. Neither Rubio's remarks nor the earlier negotiating statements, by themselves, establish that the agreement has been formally concluded.
The negotiations are unfolding against a changing trade backdrop. India's merchandise exports increased by 23% to $44.4 billion in September 2026, while the country's trade deficit narrowed, according to the figures provided. The export performance highlights the importance of international demand and market access for Indian businesses.
A trade agreement with the US could become an important element of India's broader efforts to strengthen exports, improve commercial ties and manage tariff-related uncertainties. For Washington, the negotiations offer an opportunity to expand access for American products in one of the world's major markets.
Rubio's statement has raised expectations that the two countries could be approaching an important stage in their trade negotiations. His upcoming visit to New Delhi adds further significance to the diplomatic engagement. Yet important questions remain over dairy access, tariff commitments, legal drafting and the relationship between trade policy and energy-related sanctions.
The coming discussions could provide greater clarity on whether the first phase of the agreement is ready for completion or whether further negotiations will be necessary. For now, the US has signalled that a deal is within reach. Whether that optimism translates into a signed agreement will depend on the final terms accepted by both sides.
