India isn't rushing into US trade deal. What's behind the confidence?

There is a buzz that the trade talks between India and the US are near completion, and the markets seem to be cheering that. Bilateral trade agreements are generally long-drawn and need compromises on both sides. India has drawn a red line against a much bigger economy that is one of its main export markets. But what is behind this confidence?It's no mere posturing. Recent facts and figures from India and in the US have given New Delhi the confidence to play the game of nerves and patience. A resilient domestic economy, a lower-than-expected hit to exports, and the Trump government caving in on tariffs on certain products must have given India the courage to wait with optimism. "They [the US] see India as a trusted partner. We are both equally committed to working to expand trade and commerce between the two countries... When the deal becomes fair, equitable, and balanced, you will hear good news," said Piyush Goyal, Union Minister for Commerce and Industry.That "good news" is on the horizon was spelt out, but for that the deal needs to be "fair, equitable and balanced". While India will definitely make some concessions, it is unlikely it will budge on key aspects of the farm and dairy sectors. "For now, we've avoided the worst impact of the 50% US tariffs. If needed, we are ready to wait," a senior Indian government official aware of the trade talks told Reuters.However, the wait for the India-US trade deal has been impacting investor sentiments despite India's economic fundamentals remaining resilient. The rupee hit a lifetime low of 89.49 against the US dollar on November 22, with experts suggesting the uncertainty over the trade deal as one of the factors. The rupee surpassed its earlier all-time low of 88.80 against the dollar amid foreign investors withdrawing $16.5 billion from Indian equities so far this year, according to a Reuters report.

INDIA-US TRADE DEAL BEFORE END OF YEAR?
According to another official, quoted by ANI a week ago, the India-US trade deal is likely to be sealed before the end of the year. The official said there had been "lot of progress recently" and discussions could deliver results "before the end of the year".The official told ANI that the US was working on two parallel issues with India—a reciprocal trade agreement and ongoing concerns over India's imports of Russian oil.The administration of US President Donald Trump in August hit India with overall 50% duties, with 25% as punitive tariffs over trade with Russia. India's purchase of crude oil from Russia has gone down considerably. While state-run refiners have cut imports from Russia by 45%, sourcing of crude from Moscow by private operators reached its highest point in September.Reliance Industries (RIL) on Friday announced that it has stopped importing Russian crude for its Jamnagar refinery since November 20.This came even as New Delhi announced on November 17 that it had signed a one-year agreement to source 2.2 million tonnes of LPG from the US. With this, India would be sourcing around 10% of its annual imports from the US in 2026.

INDIA'S ECONOMY RESILIENT DESPITE TRUMP TARIFFS
Even as negotiations and adjustments continued, India's economy showed resilience amid US tariffs. "Till now, India's GDP growth has remained largely unaffected by President Trump's tariffs," Forbes said in a report in the last week of October. Before the tariffs were announced in August, the International Monetary Fund had projected the Indian economy to grow at 6.4% for this fiscal year. Despite the high tariffs, the growth was revised to 6.6% by the IMF in October. Coinciding with the tariffs, the Indian government in September slashed Goods and Services Tax (GST) rates to spur domestic consumption, a big driver of the economy. Then there is the lesser-than-expected impact on Trump's tariffs on Indian exports to the US. According to Reuters, Indian exports to the US fell 8.6% year-on-year to $6.3 billion in October. The decline in the second month of the tariffs was lesser than the 12% drop in September, it said.