Indian and US negotiators have made progress in their latest round of talks in New Delhi on Tuesday on a bilateral trade deal, having focused on market access for industrial and some agricultural goods, tariff cuts and non-tariff barriers, Reuters reported citing Indian government sources.

"The negotiations held with the U.S. side were productive and helped in making progress towards crafting a mutually beneficial and balanced agreement including through achievement of early wins," one of the sources said.

The U.S. delegation, led by senior officials from the Office of the U.S. Trade Representative, held closed-door negotiations with Indian trade ministry officials headed by chief negotiator Rajesh Agrawal. 

Among the preliminary agreements reached, both sides discussed increasing bilateral digital trade, by improving customs and trade facilitation measures, the sources said, adding that "negotiations will continue" for early conclusion of the initial tranche of the trade pact.

U.S. President Donald Trump and Indian Prime Minister Narendra Modi had agreed in February to conclude a bilateral trade agreement by fall 2025 and to more than double bilateral trade to $500 billion by 2030.

Here are some of the highlights of the preliminary agreement:

According to Reuters, the potential 26% tariff on India would be devastating to Indian goods - including rice, shrimp, textiles and footwear, which together comprise nearly one-fifth of India's merchandise exports - and could severely hit exports and dampen foreign investment inflows.

India has pledged to increase purchases of American goods, including energy products like liquefied natural gas, crude oil, coal and defence equipment.

India’s exports to the U.S. rose 28% to $37.7 billion in the first four months of 2025, while imports increased to $14.4 billion, widening India’s trade surplus, according to U.S. government data.