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Vice President JD Vance and Indian Prime Minister Narendra Modi made “significant progress” toward a trade deal between the U.S. and India in talks on Monday (POLITICO Pro, subscription). 
 
What’s going on: “According to a statement, the two countries finalized ‘the Terms of Reference for the negotiations, laying down a roadmap for further discussions about our shared economic priorities.’”

• Vance’s office did not offer clarification on the “Terms of Reference.”
• Vance—in India on a four-day visit this week—and Modi also went over “progress toward implementing an ambitious plan to more than double bilateral trade to $500 billion annually by 2030, per a February joint statement between Modi and President Donald Trump, and pledged cooperation on issues related to defense and energy security.”  

The backdrop: The talks come as countries seek conversations with the U.S. on the Trump administration’s nation-specific “reciprocal” tariffs, now paused for 90 days.    

• The paused reciprocal tariffs—scheduled to go into effect July 9 for any countries that do not reach a deal with the U.S. by that date—would impose an additional 26% reciprocal tariff on Indian exports to the U.S. 

Why it’s important: “The U.S. is India’s largest trading partner, and their two-way bilateral trade reached nearly $130 billion last year. The U.S. had a trade deficit of $45.7 billion with India, according to data from the Office of the U.S. Trade Representative.”