Business meetings need different templates for different partners, says FM Sitharaman

NEW DELHI: India cannot use a single template for trade negotiations with major economies as tariffs, geopolitical risks and supply chain concerns increasingly reshape the global trading system, Finance Minister Nirmala Sitharaman said on Monday.

At the Munich meeting of leaders in New Delhi, Sitharaman said India’s recently concluded talks with the European Union (EU) should not automatically serve as a model for its ongoing talks with the US. The India-US deal has yet to be finalized and remains under “tough and very vigorously negotiated” talks, she said.

“Patterns may exist for different countries in different parts of the world,” Sitharaman said, pointing to differences in India’s trade relations. In the case of the U.S., she noted that the trade balance is “very much in our favor,” giving Washington a different negotiating priority.

Bilateral trade between India and the US rose to $140.77 billion in fiscal year 2026 (FY26) from $132.14 billion in FY25, according to Directorate General of Foreign Trade (DGFT) data. India’s exports to the US rose to $87.31 billion from $86.51 billion, while imports rose to $53.45 billion from $45.63 billion. As a result, India’s trade surplus with the US narrowed to $33.86 billion from $40.89 billion.

India and the US began talks on a bilateral trade agreement in February 2025, with Prime Minister Narendra Modi and President Donald Trump formally announcing the talks. The deal has yet to be concluded.

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Different offers, different bets

Sitharaman said negotiations between India and the EU must take into account sensitive sectors on both sides, including agriculture, dairy, meat and soy. Conversations also had to address supply chain resilience, including the need to find new partners where existing supply chains have already been disrupted.

The contrast with China is sharper. The minister said India’s trade deficit with China has risen sharply since 2014 and that the countries are increasingly seeking to address the trade imbalance through means other than traditional negotiations, with tariffs “weaponizing” themselves in the process.

India cannot simply replicate such approaches with China and would instead have to rely on negotiation and give and take, she said.

The comments underscore how India is negotiating more trade deals at a time when tariff concessions are only one part of the equation. Supply chain resilience, strategic autonomy and geopolitical risks are increasingly shaping the terms of trade policy.

Sitharaman also argued that bilateral and multilateral trade arrangements were never mutually exclusive. But the balance has shifted toward bilateral agreements as the institutions meant to govern and regulate the multilateral system have weakened.

“Multilateralism is not going away and multilateralism should not go away,” Sitharaman said, adding that the weakening of institutions like the WTO has increased countries’ confidence in implementing bilateral agreements.

The remarks come at a time when India is simultaneously working on trade deals with several partners, including the US and Canada.

The Munich Leaders’ Meetings are part of the Munich Security Conference (MSC), which was established in 1963 for high-level security dialogue. Meeting in New Delhi on 4-5 In October, in collaboration with the Government of India, it focused on economic security, resilient supply chains, strategic autonomy and the changing role of emerging and middle powers.

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New investment template

Sitharaman said India is also moving towards a new template for bilateral investment protection agreements. The framework, which incorporates lessons from recent agreements with countries including the United Arab Emirates, Oman and Saudi Arabia, is expected to be approved by the cabinet soon.

Mint reported on September 25 that the Union Cabinet will soon consider revising the decade-old Model Bilateral Investment Treaty (BIT) to make it easier for foreign companies to seek international arbitration for investment disputes in India.

Negotiations are already underway with Canada and several other countries on elements of the proposed framework, Sitharaman said. India hopes to conclude bilateral investment protection agreements with at least three other countries by December, while a pact with Canada could be concluded by December or early next year if negotiations progress as planned.

The broader message from the discussion was that India is increasingly viewing trade policy through the lens of economic security. European participants in the meeting similarly argued that India and Europe have a common interest in diversifying supply chains, reducing external dependence and building strategic autonomy.

Sitharaman described the India-EU deal as the “mother of all deals”, highlighting the scale of the two economies and the strategic importance of the partnership.

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