New Delhi is evaluating possible concessions covering data governance and market access for digital services, although no final decision has been made.
The negotiations also cover US concerns over medical devices, agricultural products, standards, ICT imports, cross-border data flows and data localisation.
The February framework envisaged reciprocal market access, but fresh US tariff measures have disrupted the original terms even as bilateral trade remains strong.
India May Open Up Digital Rules For US Trade Deal: What’s At Stake
India and the US are negotiating possible digital trade concessions covering data governance and market access in digital services, as both sides seek to revive progress on their proposed bilateral trade agreement amid continuing tariff tensions
India-US Trade Deal
Summary
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India and the US are holding virtual negotiations over non-tariff and regulatory barriers as part of a proposed bilateral trade agreement. New Delhi is evaluating potential digital trade concessions for Washington.
These concessions focus on India's data-governance framework and rules governing market access in digital services, areas that could have implications for US technology companies.
However, the contours of any possible concessions are still being worked out and no decision has been finalised, the sources said.
The talks build upon a broader trade framework established in February. Commerce Secretary Rajesh Agrawal said both sides remain "committed to moving ahead with the framework agreed in February even as Washington's tariff actions and investigations continue to create uncertainty".
Digital Trade Regulatory Hurdles
The February framework aims to resolve multiple trade frictions. It targets barriers affecting US medical devices, food and agricultural products, standards and testing requirements and import licensing rules for information and communication technology products such as laptops, tablets, personal computers and servers.
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The framework also referred to issues such as cross-border data flows and data localisation, while recognising the countries’ domestic laws and regulations.
American authorities have consistently highlighted regulatory bottlenecks in the Indian market. The Office of the US Trade Representative flagged Indian digital regulations, market access and ICT import barriers in its March 2026 National Trade Estimate report.
The agency raised similar concerns regarding digital and data policies during the World Trade Organization Trade Policy Review of India in July.
New Delhi has already established a precedent for such digital commitments. India recently concluded a trade agreement with the European Union featuring a dedicated digital-trade chapter.
This section covers electronic transactions, paperless trading, e-contracts, online consumer protection, cross-border data flows, data localisation, e-invoicing, cybersecurity and source-code protection.
Tariff Disputes and Trade
The February 6 framework originally outlined reciprocal market access. It required New Delhi to cut or eliminate tariffs on American industrial and a wide range of agricultural goods.
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In exchange, Washington agreed to an 18 percent reciprocal tariff rate on originating Indian goods, with further relief for specified products subject to the successful conclusion of the deal.
Recent trade measures have disrupted these initial terms. Washington imposed a 10 percent additional tariff on most Indian goods under US Section 301 actions related to forced-labour practices.
The two nations are currently revisiting the arrangement to navigate these fresh tariff barriers.
Bilateral trade volumes remain strong despite the friction. Indian exports to the US increased nearly 13 percent to $9.02 billion in July. Meanwhile, imports grew 18.1 percent to reach $5.5 billion during the same period.