Trade Negotiations Underway
India and the United States commenced two days of trade talks in New Delhi on Wednesday, with both governments aiming to finalize a long-delayed pact and reduce the 50% import duties that continue to affect Indian exports.
The meetings involve US Deputy Trade Representative Rick Switzer engaging with India’s Foreign Secretary Vikram Misri and Commerce Secretary Rajesh Agrawal.
According to the Indian Ministry of External Affairs, the discussions encompassed trade, technology, and supply chains, as both nations sought progress before the end of the year. Spokesperson Randhir Jaiswal stated that the meetings focused on the robust India-US economic and technology partnership, ongoing negotiations, and opportunities to enhance bilateral trade and construct resilient supply chains.
Rick Switzer and Brendan Lynch, the chief US trade negotiator, are in India from December 9 to 11 to advance the broader agreement that has been under quiet negotiation since March.
The objective for both sides is to secure the initial phase of the agreement before the end of December, thereby avoiding another public delay that has previously caused concern.
US Seeks Tariff Reduction, Faces Rice Dumping Concerns
Washington and New Delhi are structuring the agreement in phases, with the initial stage designed to eliminate the retaliatory duties imposed by Donald Trump on Indian goods. The 50% tariff also reflects penalties associated with India's continued purchases of Russian oil.
In November, Trump indicated he would reduce tariffs at some point, but recently he warned of potential action against India over allegations of Indian rice being dumped into the US market if the dispute escalates.
The two governments had initially planned to complete the first tariff-focused portion of the deal by the fall, but the deadline passed. In recent weeks, Indian officials have expressed optimism about finalizing this initial section before the end of December.
One official noted that the talks also addressed broader economic and trade relations, in addition to the effort to finalize an agreement that both sides consider mutually beneficial after several rounds of negotiations failed to resolve differences.
Indian Refiners Purchase Discounted Russian Crude, Reliance Abstains
Four of India's seven largest refiners are currently sourcing Russian crude oil due to significant discounts, which are attracting buyers to barrels that avoid sanctions. Reliance Industries, however, is not participating in these purchases.
Indian Oil Corp. and Bharat Petroleum Corp. have acquired approximately 10 cargoes of unsanctioned crude, including Urals, in recent days. Hindustan Petroleum Corp. is actively seeking supply for January delivery.
When combined with Nayara Energy, which continues to accept Russian crude despite European blacklisting, these four refiners accounted for over 60% of India's oil imports this year, according to data from tracking firm Kpler.
None of the mentioned companies responded to emailed inquiries. One major buyer is notably absent from this group. Reliance is currently avoiding Russian oil, even under a term contract with Rosneft for 500,000 barrels per day. This withdrawal is a direct consequence of sanctions.
Russian crude is being traded at prices between $40 and $45 per barrel in India, as price reductions attempt to mitigate political risk. India's imports of Russian crude peaked at over 2 million barrels per day in June. This volume is projected to decrease to about 1.3 million barrels in December, partly due to cargoes booked before new restrictions, and is expected to decline further in January.
It remains uncertain whether these reduced import volumes will satisfy Donald Trump, who has accused India of financing Vladimir Putin's war and demanded the two nations sever ties. A long-awaited trade deal continues to be unresolved.