BGA India Non-Executive Chairman Amb. Alok Prasad, wrote an update to clients on the implications of the U.S. Vice President JD Vance’s visit to India.

Context

  • U.S. Vice President JD Vance, along with a delegation of senior Pentagon and State Department officials, was in India from April 21-24 for his first official visit to the country. The visit comes at a critical time when the two countries are working toward finalizing the first tranche of a bilateral trade agreement (BTA) amid the impending possibility of U.S. reciprocal tariffs on several countries across the globe, including India.
  • Vance’s choice of India as his first trip to Asia since taking office portends well for U.S.-India bilateral ties. The engagement builds off of Indian Prime Minister Narendra Modi’s visit to Washington, D.C., in February, when both sides announced plans to sign a BTA by fall 2025. Senior officials of both countries have discussed bridging gaps in subsequent bilateral visits.

Significance

  • Both leaders discussed ways to bolster bilateral cooperation across trade, strategic technologies, defense and energy. They also welcomed significant progress in the negotiations for a mutually beneficial BTA and briefly discussed preparations for the bilateral meeting between Modi and U.S. President Donald Trump on the sidelines of the Quadrilateral Security Dialogue (the “Quad”) Leaders’ Summit between Australia, India, Japan and the United States. The summit is scheduled to take place in India in September 2025.
  • In the remainder of the 90-day period for which reciprocal tariffs have been rescinded, the Indian government’s preference will be to agree on the contours of the initial BTA to avoid reciprocal tariffs. Beyond this period, expectations of upsides to incoming foreign investments into India, particularly aimed at manufacturing electronics and consumer goods for U.S.-bound exports, will persist. This is especially likely if India continues to enjoy lower tariffs in comparison to other competing investment destinations regionally.

Implications

  • In the coming months, India is expected to accelerate its strategic approach to diversify exports to alternative trade blocs while it works with the United States to finalize a BTA. This will likely include advancing free trade negotiations with the United Kingdom, the European Union and other partners while expediting new trade routes, such as the India-Middle East-Europe Economic Corridor.
  • Companies have an opportunity to engage closely with U.S. and Indian stakeholders on trade and investment issues as bilateral trade negotiations delve into sector-specific details. An early conclusion of the BTA could secure enhanced market access, supply chain diversification and newer investment avenues into India.

We will continue to keep you updated on developments in India as they occur. If you have any questions or comments, please contact BGA Senior Director Vaman Desai at vdesai@bowergroupasia.com.

Best regards,

BGA India Team

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Non-Executive Chairman

Alok is one of India’s most respected foreign policy, national security and international relations experts. Based in New Delhi, he maintains unparalleled networks in India’s government and civil service, business, civil society and diplomatic circles. Working with the BGA India team, he guides the development of client strategies and directs their implementation as non-executive chairman. Alok retired from government service in 2012 as India’s ambassador to Japan, where he led the mission during the negotiation and signing of the India–Japan Comprehensive Economic Partnership Agreement. He lived in Japan through the tsunami and the Fukushima nuclear disaster. Prior to his post ... Read More