President Donald Trump has hinted at a significant trade agreement with India, describing it as a "very big" deal that will follow soon after the United States signed a new trade pact with China. The announcement came during a White House event on Thursday, marking a potential shift in America's trade relationships with major Asian economies.

China Deal Sets Stage for India Negotiations

Trump made the announcement while speaking at an event for the Big Beautiful Bill, confirming that the US has already concluded negotiations with China. According to him, India will be the next partner — negotiations are already underway, with the President expressing optimism about reaching a comprehensive agreement.

The timing of Trump's announcement is particularly significant as it comes amid ongoing trade tensions and tariff discussions between Washington and New Delhi. The President's comments suggest that the administration is pursuing a sequential approach to trade negotiations, first securing deals with China before moving to finalize terms with India.

India's Strategic Position in US Trade Policy

India has been actively positioning itself as a key trading partner for the United States, with recent reports suggesting significant concessions from New Delhi. India has offered to slash its tariff gap with the U.S. to less than 4% from nearly 13% now, in exchange for an exemption from President Donald Trump's "current and potential" tariff hikes, according to sources familiar with the negotiations.

The potential agreement represents a major diplomatic and economic opportunity for both nations. "PM Modi and US President Trump met in February 2025... Both our leaders have decided to enter into a bilateral trade agreement which will be mutually beneficial for both the economies, businesses on both sides and the people of both countries," Goyal said.

Multi-Phase Approach to Trade Agreement

According to Bloomberg reports, India is discussing a US trade deal structured in three tranches and expects to reach an interim agreement before July, when President Donald Trump's reciprocal tariffs are set to kick in. This phased approach could allow both countries to gradually implement trade reforms while managing domestic economic concerns.

The structured timeline is crucial given the looming tariff deadlines and the need for both countries to secure legislative and regulatory approvals for any comprehensive trade agreement.

Economic Implications and Market Response

The prospect of a US-India trade deal has significant implications for global trade dynamics. Both economies stand to benefit from reduced trade barriers, increased market access, and enhanced economic cooperation across multiple sectors including technology, pharmaceuticals, and manufacturing.

Industry analysts view the potential agreement as part of Trump's broader strategy to reshape international trade relationships through bilateral deals rather than multilateral frameworks. The approach mirrors similar negotiations the administration has pursued with other major trading partners.

Looking Ahead: Timeline and Expectations

While specific details of the proposed India deal remain under wraps, the President's public commitment to a "very big" agreement suggests substantial scope and ambition. The administration appears confident in its ability to conclude negotiations in the near term, building on the momentum from the recently signed China agreement.

The success of these trade negotiations could set a precedent for future US trade policy in Asia and potentially influence relationships with other regional partners. Both American and Indian officials have expressed optimism about reaching a mutually beneficial agreement that addresses longstanding trade imbalances and creates new opportunities for economic growth.

As negotiations continue, businesses and investors in both countries are closely monitoring developments, anticipating that a successful agreement could unlock significant new opportunities for bilateral trade and investment flows.