India–US Trade Deal Likely to Be Finalised This Year, Says Economic Survey 2026 — External Risks Remain

New Delhi: The Indian government has indicated that the long-awaited India–United States trade agreement could be finalised within the current year, according to the Economic Survey 2026 tabled in Parliament by Finance Minister Nirmala Sitharaman on Thursday.

The Survey noted that while India faces certain external challenges, there is no immediate threat of a major economic disruption. It cautioned, however, that slower growth among key trading partners, higher trade tariffs, and volatility in global capital flows could periodically impact India’s exports and investor confidence.

Importantly, the Survey stated that ongoing trade negotiations with the United States are expected to conclude this year, which could help reduce uncertainty on the external front. India and the US have been negotiating a bilateral trade deal since March last year, with six rounds of talks completed so far. The pace of negotiations slowed after Washington imposed steep tariffs on Indian goods in August 2025.

Impact of US Tariffs

The United States imposed a 25% tariff along with an additional 25% penalty on certain Indian products, citing India’s continued purchase of crude oil from Russia. In December 2025, a delegation from the Office of the US Trade Representative, led by Deputy USTR Ambassador Rick Switzer, visited India. This was the second such visit by US officials after the tariffs were announced.

Global Outlook and Growth Projections

Global financial institutions remain cautious. Goldman Sachs Group has projected that despite expectations of an India–US trade deal by March, India’s economic growth could moderate to 6.8% in the next financial year. Meanwhile, the United Nations has suggested that stronger demand from markets such as Europe and West Asia may partially offset the impact of US tariffs.

The Economic Survey also highlighted India’s broader trade diversification efforts, pointing to progress in finalising a trade agreement with the European Union, reflecting shifting global economic alignments.

GDP Growth Outlook

According to the Survey, India’s real GDP growth is expected to remain between 6.8% and 7.2% through FY2027, supported by robust domestic demand and macroeconomic stability, even as global uncertainties persist. The government expressed confidence that India is entering the coming years with strong economic fundamentals and is likely to sustain around 7% real growth in the near term.