New Delhi

The United States has assured India that it will enjoy a comparative tariff advantage over peer economies under the proposed bilateral trade pact, a senior government official said, even as negotiations on the first tranche and the broader agreement continue.

"The US has assured India of a comparative tariff advantage over its competitors in the trade deal. We will have to see how the tariff framework unfolds," the official said.

However, the official cautioned that the advantage will depend on the final tariff structure, as the outcome of the second investigation initiated by the Office of the United States Trade Representative (USTR) against India is still awaited.

India is working to close the first tranche of the deal by the end of this financial year, the official said, adding that talks are being held simultaneously on the first tranche and the broader Bilateral Trade Agreement (BTA).

Issues related to services will not be part of the initial package. They will be taken up as part of the second tranche, the official said, and will form a part of the larger BTA.

The official also described the shape the final agreement will take, a legal text with annexures, along with a dedicated chapter on customs and trade facilitation.

Earlier, another top official of the Commerce Ministry told ANI that India and the US held discussions on customs and trade facilitation last week. According to that official, a two-member US team was in India on November 2-3 for talks on customs and trade facilitation between the two countries.

READ MORE: Kashmiri youth Musaib is cycling 3,600 Km on an ordinary bicycle

Both sides have been negotiating the pact in phases, with the aim of securing early gains through the first tranche while continuing discussions on more complex areas in the broader deal.