Negotiations between India and the United States over an interim bilateral trade agreement have been temporarily delayed, with both countries opting to reassess recent policy and legal developments before proceeding.
The meeting of chief negotiators in Washington, initially planned for late February, will now take place at a mutually agreed date.
The decision comes amid evolving US tariff policies and legal challenges that continue to shape the broader trade environment between the two economies.
India and the US have agreed to reschedule the planned meeting between their chief negotiators, which was intended to finalise the legal text of the interim trade agreement. The Indian delegation had been expected to participate in discussions over several days in Washington beginning 23 February.
As per news reports, both sides concluded that additional time was required to evaluate recent developments and their potential impact on negotiations. The discussions will now be held once both governments complete internal assessments.
The delay follows fresh announcements from US President Donald Trump regarding tariff revisions affecting multiple trading partners. The administration indicated plans to raise tariffs to 15%, replacing an earlier proposal that had suggested higher levies.
If implemented, the revised tariff would apply in addition to existing Most Favoured Nation (MFN) duties. For example, a product currently subject to a 5% import duty could face an effective tariff of 20% after the additional levy, as per The Economic Times report.
A recent ruling by the US Supreme Court has added further uncertainty to the tariff framework.
The court determined that sweeping tariffs imposed under emergency economic powers exceeded presidential authority, limiting the use of certain legal provisions previously relied upon for broad trade measures.
While this decision invalidated a key legal basis for earlier tariff actions, sector specific duties and alternative trade measures remain in place, leaving future tariff structures unclear.
Trade tensions between the two countries intensified in 2025 when the US imposed reciprocal tariffs on Indian goods.
Duties were subsequently increased following additional penalties linked to India’s purchase of Russian crude oil, pushing total tariffs to elevated levels before partial rollbacks were negotiated.
Earlier this month, both nations agreed on a framework for an interim trade arrangement under which tariffs were expected to be reduced. Some punitive duties have already been withdrawn, although a portion of the tariffs continues to remain in force.
The United States continues to be India’s largest trading partner in goods. Between 2021 and 2025, the US accounted for roughly 18% of India’s exports and over 10% of total bilateral trade.
In the financial year 2024–25, overall trade between the two countries reached approximately USD 186 billion, reflecting strong commercial ties despite periodic policy disagreements.
For the interim trade pact to move forward, the agreed framework must be converted into a legally binding document. Indian officials had earlier indicated that the agreement could be signed in March and implemented shortly thereafter, although timelines may now shift depending on the rescheduled negotiations.
US authorities have also signalled that alternative legal mechanisms may be used to maintain certain tariff measures, suggesting that trade discussions will continue alongside evolving policy adjustments.
Read More: India Moves Towards Domestic Permanent Magnet Production by 2026.
The postponement of negotiations highlights the influence of shifting tariff policies and legal developments on international trade agreements. While both India and the United States remain engaged in finalising an interim trade arrangement, the timing and structure of the pact will likely depend on greater clarity around tariff rules and regulatory frameworks in the coming months.
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Published on: Feb 23, 2026, 10:04 AM IST
Neha Dubey
Neha Dubey is a Content Analyst with 3 years of experience in financial journalism, having written for a leading newswire agency and multiple newspapers. At Angel One, she creates daily content on finance and the economy. Neha holds a degree in Economics and a Master’s in Journalism.
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