Washington: Even as the U.S. rolls out new tariffs on several nations, President Donald Trump on Tuesday signaled optimism about a trade deal with India, stating that Washington is “close to making a deal” with New Delhi. However, negotiations remain stuck over key issues, particularly in the agriculture and dairy sectors.
“We’ve made deals with the UK, China, and we’re close to a deal with India… Others we don’t see it happening, so we just send them a letter,” Trump said at the White House, referring to new tariff notifications being sent to countries including Bangladesh, Thailand, South Korea, and Japan. These tariffs are set to take effect starting August 1.
The fresh wave of tariffs is part of Washington’s strategy to pressure nations that, according to Trump, are not aligning with U.S. trade standards. “We’re sending letters telling countries what tariffs they’ll have to pay. If someone has a good reason, we’ll consider it — but we won’t be unfair,” Trump added.
Sticking Points in the U.S.-India Trade Talks
Despite progress, U.S.-India negotiations remain bogged down over Washington’s insistence that India open its markets to genetically modified (GM) crops and dairy imports — areas India has long protected due to food safety concerns and risks to farmers’ livelihoods.
Agriculture accounts for only 16% of India’s $3.9 trillion economy, but it supports nearly half of its 1.4 billion citizens. Any move to allow cheaper U.S. imports could crash domestic prices, triggering political backlash and rural unrest — a risk the government is unwilling to take.
India has consistently kept agriculture out of Free Trade Agreements (FTAs), and granting the U.S. access could compel New Delhi to extend similar terms to other trade partners.
On the other hand, India is pressing for meaningful U.S. tariff cuts on its labor-intensive exports like footwear, garments, and leather — sectors that provide mass employment and are vital to India’s job market. Without broader tariff relief on such goods, Indian officials argue the goal of doubling bilateral trade to $500 billion by 2030 would remain out of reach.
As reported by NDTV Profit, the focus of talks has now narrowed to reciprocal tariff reductions, with both countries being urged to prioritize lowering trade barriers to revive momentum.