India Seeks Fair Deal Before August 1 Tariff Deadline
India's senior trade negotiators have come back from Washington as the fifth round of bilateral negotiations hit a deadlock without making any progress. The four-day talks, which took place amidst escalating global trade tensions, did not yield any solution to long-pending issues related to agriculture, cars, and e-commerce.
With US President Donald Trump's August 1 deadline for fresh tariffs looming near, India is under increased pressure. But they will not hurry into an "unbalanced" agreement and will stick to securing a balanced deal before the deadline if at all possible. Two agreed frameworks continue to guide the talks, but India is adamant about safeguarding domestic priorities despite the spectre of retaliatory US tariffs.
Top negotiator Rajesh Agrawal headed the Indian team at the four-day talks in Washington. The talks concluded on Saturday with no big deals, other than reaffirming the format and the timeline. The two countries are still stuck on key areas like agriculture, the auto sector, and newer issues such as digital trade. These issues have stalled progress since March.
One official who is close to the situation stated that India will try to finalize the agreement by August 1 but will not make concessions on matters of national interest. "Negotiators can't pledge more than their mandate regardless of the US tariff threat," the official added.
India demands a balanced, long-term, and reciprocal deal. "Asymmetrical arrangements" were considered off the table by officials, using as an example a past agreement with Indonesia when the US enjoyed zero-duty access but maintained a 19% duty on Indonesian exports. "Bilateral deals are not made in anticipation and good faith that the other side might return similar concessions in the future," replied an Indian official.
India desires the US to adhere to the frameworks reached in February and April. The February 13 joint statement envisioned a Bilateral Trade Agreement (BTA) by fall 2025. The April 21 terms of reference (TORs) were finalized during Vice-President JD Vance's India trip.
India still denies the US's insistence on free access to its agri-markets. It has strongly resisted genetically modified foodstuffs such as corn and soybeans, domestic consumption of which has been prohibited. The dairy industry is also closed off owing to religious and means of livelihood considerations.
Similarly, India does not want to open up its automobile sector without matching action from the US, particularly in steel, aluminium, and auto parts tariffs.
It is also a living democracy where the will of the people prevails, as one official put it. The same official observed that "subsistence sectors still need protection to save the livelihood of millions of poor."
Trump has sharpened his trade requirements not only against India but across the globe. The Financial Times quoted on Friday that Trump is now insisting on minimum tariffs of 15% to 20% from the EU — an increase from a previous 10%. Trump has threatened 30% tariffs on every European import in the event of no deal by August 1.
Trump also has threatened a 10% tariff on every BRICS member country — including India — for threatening the dominance of the US dollar. More than two dozen countries have already been sent ultimatum letters by the White House, threatening 25% to 50% tariffs from August 1.
India has not yet been sent one of those letters. That, officials maintain, means that the door to an agreement remains open.
India is holding firm despite pressure. The nation hopes for a deal, but with Trump's tariff threat looming close, it will safeguard its national interest.
