Commerce Secretary Rajesh Agrawal is slated to join the Indian delegation in the United States tomorrow for pivotal trade discussions, signaling India’s strong interest in increasing its energy imports from America.
Over the past seven to eight years, India’s energy imports from the U.S., primarily crude oil, have seen a substantial decline, dropping from an estimated $25 billion to roughly $12-13 billion.
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Addressing reporters in New Delhi, Mr. Agrawal highlighted a potential “headroom” of approximately $12-15 billion in energy purchases that India could make without necessitating changes to its refinery infrastructure.
He further elaborated on a mutual commitment between the two nations, stating that India has expressed a strong desire to diversify its energy import portfolio. This diversification, he noted, represents the most strategic approach for a major energy consumer like India.
These statements hold significant weight, as increasing crude oil imports from the U.S. would directly address Washington’s concerns regarding its merchandise trade deficit with India, which reached $45.8 billion in the fiscal year 2024-25.
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“As a nation, we would be delighted to procure more energy from the U.S., provided it is available at a competitive price,” Mr. Agrawal affirmed.
The Indian negotiating delegation is currently in Washington for trade discussions, and Mr. Agrawal is expected to join them soon.
He added, “Our negotiation team is already in the U.S., actively seeking a mutually beneficial resolution that can effectively address current tariff-related issues between both countries.”
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When questioned about the formality of these negotiations, the Commerce Secretary clarified that due to a government shutdown in the U.S., staffing levels are reduced, impacting their operational capacity.
He explained, “While it’s not an ideal time for comprehensive negotiations, both sides are making progress in exploring avenues to tackle existing trade challenges and find viable solutions.”
Earlier this year in February, leaders from both nations mandated officials to negotiate a proposed Bilateral Trade Agreement (BTA), setting a target to finalize its initial phase by the autumn of 2025.
To date, five rounds of these crucial negotiations have been successfully concluded.
Last month, Commerce and Industry Minister Piyush Goyal spearheaded an official delegation to New York for trade talks.
These discussions are particularly vital given the strained relations between the two countries, which began after the administration of U.S. President Donald Trump levied a substantial 50% tariff on Indian goods, alongside an additional 25% import duty on Russian crude oil purchases.
India has consistently characterized these tariffs as “unfair, unjustified, and unreasonable.”
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Nevertheless, recent phone conversations between Prime Minister Narendra Modi and President Trump have sparked renewed optimism for a favorable resolution in the ongoing trade deal negotiations.
Following a short hiatus, Assistant U.S. Trade Representative for South and Central Asia, Brendan Lynch, met with Indian officials in New Delhi on September 16. During this meeting, both parties reiterated their commitment to achieving an expedited and mutually advantageous agreement.
Just last week, U.S. Ambassador-designate to India, Sergio Gor, engaged in discussions with the Commerce Secretary to further strengthen India-U.S. economic ties.
This ambitious pact aims to more than double the current bilateral trade volume of $191 billion, targeting an impressive $500 billion by 2030.
For the fourth consecutive year in 2024-25, the U.S. maintained its position as India’s leading trading partner, with bilateral trade reaching a significant $131.84 billion, including $86.5 billion in exports from India.
Overall, trade with the U.S. accounts for approximately 18% of India’s total goods exports, 6.22% of its imports, and 10.73% of the nation’s total merchandise trade.