In a push to speed up a reciprocal trade deal, the US is likely pressuring India to open up its $125 billion e-commerce market more fully to American giants like Amazon and Walmart, the Financial Times reported.
Walmart and Amazon are pushing for a more favourable US trade strategy with India, as they face growing competition from the Indian conglomerate Reliance and struggle with regulatory hurdles. Industry executives told the Financial Times that the Trump administration has been working closely with both Walmart and Amazon to shape this strategy.
The US is likely advocating for fairer terms in India’s e-commerce sector, where the current rules restrict American companies like Amazon and Walmart to operating as neutral marketplaces, preventing them from selling their own goods directly to Indian consumers.
In contrast, Indian competitors are allowed to manufacture, own and sell products directly through their platforms, an advantage US officials describe as a ‘non-tariff barrier’. Adding to the challenge, India also imposes limits on foreign direct investment in retail.
This week, US Vice President JD Vance visited India and met with Prime Minister Narendra Modi, as both sides finalised the terms of reference for a potential trade deal – setting the stage for formal negotiations ahead.
The talks fall under a broader India–US trade framework expected to span various sectors, including food and automobiles. On 2 April, President Trump imposed a 26 per cent tariff on India, though its implementation has been paused for 90 days.
‘The attempt to pressure India into opening its e-commerce sector wider for American giants like Amazon and Walmart reflects a broader pattern of economic diplomacy aimed at securing market dominance for its corporations’, said Praveen Khandelwal, secretary-general of the Confederation of All India Traders and a member of India’s parliament.
‘While foreign investment is welcome, it must not come at the cost of distorting India’s retail ecosystem or undermining the interests of its [90 million] small traders’, he added.
For US retailers, challenges go beyond limited market access: Indian authorities have also intensified crackdowns, with the Bureau of Indian Standards targeting their warehouses for storing non-certified products.
The US remains India’s largest trading partner, with both nations aiming to double their bilateral trade in goods and services to $500 billion.