The resounding victory of Prime Minister Narendra Modi's National Democratic Alliance (NDA) in the Bihar Assembly Elections of 2025 is poised to inject fresh momentum into India's bilateral trade negotiations with the United States, potentially paving the way for the finalisation of a long-pending trade agreement by year's end. According to a recent analysis, the NDA's three-fourths majority in the 243-seat assembly—securing over 200 seats, with the Bharatiya Janata Party (BJP) clinching 89 and ally Janata Dal (United) 85—bolsters the central government's political capital to make calculated concessions on sensitive agricultural issues.

This outcome comes amid escalating trade tensions, including U.S. President Donald Trump's imposition of 50% tariffs on Indian imports in two tranches starting August 2025, and follows five completed rounds of talks for the Bilateral Trade Agreement (BTA). Experts suggest the Bihar mandate could reassure policymakers to prioritise economic diplomacy without alienating domestic stakeholders.

Bihar's pivotal role as a major corn-producing state underscores the strategic timing of the NDA's win, aligning directly with U.S. demands for greater market access to Indian agriculture. During Commerce Minister Piyush Goyal's September 2025 visit to the U.S., both nations exchanged "fresh offers", including India's commitment to procure American corn for ethanol production to support its ethanol-blended fuel initiatives.

The Mahagathbandhan opposition, comprising the Rashtriya Janata Dal (RJD) with 25 seats and Congress with just six, failed to mount a significant challenge, leaving the NDA unencumbered by regional pushback. As an agriculture-driven economy, India has historically resisted opening its farm sector to protect local livelihoods, but the Bihar verdict—celebrated as a personal triumph for Modi—signals a window for calibrated tariff reductions on U.S. agro imports, potentially averting further escalation in bilateral duties.

Amitendu Palit, senior research fellow at the Institute of South Asian Studies, emphasised in the report that such concessions could significantly boost U.S. agro-product exports to India, stating, "Any agriculture-related concessions or tariff cuts for imports into India will bring more purchases of agro products from the United States."

However, Palit cautioned that these moves would be "couched in a manner that does not suggest that the government is going to back away from its commitment to domestic farmers," ensuring concessions are framed as mutually beneficial, such as enhanced ethanol supply chains. Recent reports from the Asian News International (ANI) indicate that an additional negotiation round may not be required, with discussions now focusing on sensitive sectors like dairy and poultry, where India seeks reciprocal safeguards.

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As the BTA nears closure, the Bihar outcome exemplifies how domestic electoral successes can catalyse international economic strategies, reinforcing Modi's image as a deal-maker on the global stage. With the U.S. pushing for a balanced pact amid broader geopolitical shifts, India's ability to leverage its agricultural heft—exemplified by Bihar's corn output—could yield a framework that fosters trade growth while upholding farmer protections.

This development not only alleviates immediate tariff pressures but also positions India as a resilient player in reshaping Indo-U.S. economic ties for the post-2025 era.

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