American negotiators have assured India of a comparative advantage over its rivals under the proposed trade deal, a senior government official said on Friday. The official said the legal text of the agreement will also include provisions to ensure that the US does not impose additional tariffs after the deal is signed between the two countries.The official said negotiators from both sides continue to engage in discussions to finalise the trade deal. The last round of talks, held during the first week of November, resulted in the resolution of several portions of the customs and trade facilitation chapter, the official added. The US midterm elections, held on November 3, saw tariffs, inflation and the economy emerge as key issues.“US negotiators were here for two days during the first week of November. There is a chapter on customs and trade facilitation under the US trade deal. Many portions of the text were resolved. The US side has assured us of comparative advantage over our competitors. We will have to see how their tariff structure unfolds,” the official said.Responding to a question on the possibility of future tariffs on India, the official said, “What we have said is that in case there is a future tariff which goes beyond commitment, India also reserves the right to modify concessionsThe official added that India and the US are in the process of concluding negotiations for the first tranche of the bilateral trade agreement, which would not cover services.Tariff uncertaintyThe final US tariff structure is expected to become clearer after the United States Trade Representative (USTR) releases the findings of its second Section 301 investigation into industrial overcapacity. This refers to a situation in which a sector or a country’s production capacity exceeds market demand.India is expecting favourable treatment in the investigation into overcapacity. It is among 14 countries, including Australia, Japan and the European Union, that have “acknowledged” that structural excess capacity and production in any country pose significant challenges for all trading partners. These countries have also decided to take “effective actions” to address the challenge.Story continues below this adThe US had imposed 10% tariffs on India in June, lower than the 12.5% rate proposed in March, after the Directorate General of Foreign Trade (DGFT) announced a prohibition on imports of goods produced using forced labour. This came against the backdrop of the first Section 301 investigation into imports of goods produced through forced labour.With the midterm elections out of the way, the USTR is expected to release the findings of its investigation into industrial overcapacity. This could revive the tariff architecture that the Trump administration had been planning since early 2025. Most trade deals lost their legal backing after reciprocal tariffs were declared illegal by the US Supreme Court earlier this year.Sensitive sectorsCommerce and Industry Minister Piyush Goyal had said on November 3 that India will not allow imports of genetically modified (GM) products or dairy products produced using calf meat.The US has been pushing for exports of GM products under the trade deal with India and has cited Indian regulations restricting imports of certain dairy products as non-tariff barriers. In its report on non-tariff barriers released in March 2025, the USTR had described India’s requirements for dairy imports as “onerous”.Story continues below this ad“We are very sensitive to the opening of the dairy sector. Till date, we have never opened the dairy sector for anybody. We are sensitive about not allowing any GM products to come to India. We have never allowed it, and we will never allow it in the future. We are sensitive to our religious sensitivities. Very often in foreign countries, they use calf meat or rennet while producing their dairy products. We have never allowed it in the past, and we will not do so in the future. It has to be strictly certified,” Goyal had said while interacting with students at Kirori Mal College.The USTR report had said India requires dairy products intended for food to be derived from animals that have not consumed feed containing internal organs, blood meal or tissues of ruminant or porcine origin. It also noted that exporting countries must certify these conditions, which, according to the report, lack a discernible animal or human health justification.