The Carnegie Endowment for International Peace’s TATA Chair for Strategic Affairs and well-known strategic thinker Ashley J. Tellis has underlined the necessity for India to broaden its goals and take into account a Free Trade Agreement (FTA) with the United States.
Speaking about recent changes in trade policy, Tellis pointed out that Prime Minister Narendra Modi has caused a major change in India’s stance on trade deals. After first being suspicious of free trade agreements, Modi’s government now understands how crucial it is to grow international commercial ties in order to maintain long-term economic growth.
One of India’s most important commercial partners, the United States, is seen as a vital ally in this quest.
Tellis was upbeat by U.S. President Donald Trump’s decision to lower reciprocal duties on India and other negotiating nations to 10% and impose a 90-day halt on broad tariffs.
According to him, this lull represents a “interval of opportunity,” enabling both countries to concentrate on settling trade conflicts and advancing complementary areas of collaboration. However, the U.S. government took a different tack when it raised duties on China to 145%.
In response to the Global Trade Research Initiative’s (GTRI) recommendation that India should forego a comprehensive free trade agreement (FTA) with the United States, Tellis contended that India ought to set higher goals and seek a true FTA in spite of the difficulties presented by the enormous developmental differences between the two countries. He emphasised the potential advantages for both economies while acknowledging that reaching an agreement would take a lot of time and work. He also advocated for limited “Zero-to-Zero” tariff agreements on 90% of industrial items, saying that these agreements would promote greater economic integration between friendly countries.
The GTRI had suggested limited tariff agreements, like those put forth by Europe for the United States, as an alternative to full free trade agreements (FTAs) because of the potentially detrimental trade-offs for India. A Bilateral Trade Agreement (BTA) with the United States is anticipated to be finalised by the autumn of 2025, according to a statement made earlier this year by Union Commerce and Industry Minister Piyush Goyal.
Tellis’ comments highlight the strategic significance of strengthening India-US economic ties for both reciprocal economic gains and more general geopolitical goals. Improved commercial ties could be essential to fulfilling India’s aspirations to become a great power and supporting American interests in preserving its position as the world’s leading nation.
