The United States will demand full access to India’s ecommerce market for Amazon and Walmart while negotiating a bilateral trade pact, British business daily Financial Times has reported. The two nations are chalking out a trade agreement, with the Trump administration’s reciprocal tariffs looming on the horizon.

The US plans to push the Indian government for a level playing field in ecommerce during the wide-ranging talks, which are likely to cover sectors ranging from food to cars, the report said. The Trump administration has been coordinating with US ecommerce players for this part of the negotiations, the report added.

India currently allows US ecommerce companies to operate only as online marketplaces for others to sell their products.

There is also no foreign direct investment (FDI) cap on single-brand retail trading (100% allowed), while FDI in multi-brand retail trading is subject to a 51% cap and government approval.

Amazon chairman Jeff Bezos had contributed to and attended Donald Trump’s inauguration in January. Walmart chief Doug McMillon was among the industry leaders who met Trump at his Mar-a-Lago residence before the president took office. The report cited an anonymous industry executive, who stated that McMillon had brought up the issue of India’s trade barriers against ecommerce companies during this meeting. Walmart owns ecommerce platform Flipkart, which recently got its board’s approval to shift domicile to India.

Opening up the $125-billion Indian ecommerce market pits Amazon and Flipkart directly against the retail ventures of Reliance Group, the country’s leading retailer, owned by billionaire Mukesh Ambani.

India and the US have finalised the Terms of Reference for the bilateral trade agreement, according to a joint statement after a meeting between US Vice President JD Vance and Prime Minister Narendra Modi. Vance is on a four-day visit to India.The negotiations are taking place in the backdrop of a 26% reciprocal tariff imposed on India by the Trump administration. This levy will come into effect from July, after a 90-day pause declared by president Trump.

Trump has often criticised India for its trade barriers, dubbing the country “tariff king”. The US gets the largest chunk of India’s exports, which amounted to $77.52 billion in fiscal year 2024 and $68.46 billion in the first 10 months of fiscal year 2025, data with the commerce ministry shows.

The US had a trade deficit of $45.7 billion with India in 2024, according to the United States Trade Representative. India, along with other nations, is racing to secure a trade deal with the US with an eye on the tariffs.