With the US finalising a new trade deal with Vietnam, Indian exporters are hopeful that a similar agreement with India could follow soon. Experts believe India stands to gain from a favourable tariff gap—if it can close negotiations quickly and address sensitive areas, such as agriculture and transshipped goods.

A trade deal offering zero-tariff access could give Indian exporters a 10–20% cost edge over Vietnam in key sectors such as electronics, textiles, furniture, auto parts, and machinery. Even if some tariffs remain in place, India could still benefit significantly.

However, concerns remain. One major risk is the US imposing punitive tariffs—up to 40%—on Indian goods that include components imported from China. This could particularly impact electronics and pharma exports.

Agriculture is another sticking point. The US is urging India to reduce non-tariff barriers, particularly in the dairy sector. A possible solution could be allowing limited imports under lower tariffs using Tariff Rate Quotas (TRQs).

There’s also a long-term opportunity. The Vietnam deal could encourage global companies to shift manufacturing to India as they diversify beyond China and Vietnam.

Experts suggest that India must act swiftly—ideally before 13th July—to lock in a deal and avoid falling behind in the US market.

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