India and the US have begun talks towards a free trade agreement, according to Minister for Commerce and Industry Piyush Goyal.

“Both the leaders (Narendra Modi and Donald Trump) have decided to formally engage to move towards a free trade agreement between the two big economies. My own sense is that America will also gain very significantly with this Indian partnership,” Goyal said at the India-US Business Story: Opportunity, Innovation, Entrepreneurship. The session was organised by the Confederation of Indian Industry and the US-India Business Council (USIBC) to coincide with US President Donald Trump’s visit to India.

Speaking at a session titled the ‘Future of Energy Partnership’, Minister for Petroleum and Natural Gas and Steel Dharmendra Pradhan said the high importance attached to the energy component of the bilateral engagement is rather evident from positive developments during the last three years under the India-US strategic energy partnership.

He said, “US emerging as the sixth largest source for crude oil imports is a significant development. India is also now the fourth largest export destination for US crude. Our LNG imports from the US are also increasing progressively ever since the imports started in March 2018. India is now the fifth largest destination of US exports of LNG.”

Pradhan said the next India-US Ministerial meeting for the Strategic Energy Partnership is expected to be held in April to deepen engagements at government and industry channels. At the event, CII and USIBC jointly launched the $500-billion roadmap and listed 13 interventions to push India-US trade.

“To achieve the shared goal of reaching $500 billion in trade from the current $ 142 billion in 2018, would require renewed focus on tackling some of the irritants to unleash the full potential of the economic relationship,” Chandrajit Banerjee, Director General, Confederation of Indian Industry, said.

“We have seen trade grow by over 50 per cent in the past 5 years. But in order to see a doubling and tripling of the trade relationship, the two countries must work out a trade deal that can open markets in both directions,” said Nisha Biswal, President, USIBC. The report suggests simplifying the single window clearances, instituting a mechanism of automatic deemed approvals for no objection certificates, and further liberalisation of foreign direct investment norms among others.