India Must Resist ‘MASALA’ Trade Deals Under US Pressure, Warns GTRI

India must resist the growing pressure from the United States to sign a hasty trade deal that could undermine its core economic sectors, especially agriculture, warns the Global Trade Research Initiative (GTRI) in a new report.

The think tank has raised red flags about the nature of trade agreements being pushed by the Donald Trump administration, describing them as politically volatile and economically lopsided.

'Irreversible Consequences' If India Gives In
"India should stay the course and avoid trading away core sectors like agriculture. A hasty deal under pressure could have irreversible consequences, especially when such agreements may not survive the next shift in US politics," GTRI said in the report.

The warning comes amid increasing US attempts to seal trade pacts with over 20 countries, including India, ahead of its elections. However, GTRI points out that similar deals with countries like the UK and Vietnam have been struck only after months of intense pressure, while others—such as Japan, South Korea, the European Union, and Australia—have pushed back.

MASALA Deals: One-Sided and Risky
According to the report, these trade arrangements are part of what GTRI calls MASALA deals—Mutually Agreed Settlements Achieved through Leveraged Arm-twisting.

These deals typically require partner countries to slash tariffs without reciprocal concessions from the US, commit to guaranteed purchases of American goods, and still face the risk of future tariffs from Washington.

GTRI emphasized that these deals are not driven by long-term economic goals but by short-term political gains. "Such agreements are politically driven and offer no lasting certainty in international trade," the report stated.

Trump’s Trade Threats Losing Credibility
The report also noted that despite sustained pressure for over three months, Trump’s aggressive trade threats are losing traction globally. "Only the UK and Vietnam have yielded to the US's one-sided trade terms," it noted.
 

In response to limited progress, the US has turned to punitive measures. On July 7, Washington slapped 25% tariffs on imports from Japan and South Korea. Days later, it threatened 30% tariffs on goods from the EU and Mexico, despite ongoing negotiations.

India Not Alone in Facing Pressure
GTRI urged Indian policymakers to take note that the US is simultaneously negotiating with over 20 nations and demanding concessions from more than 90 countries. “India is not alone,” the report emphasised, adding that global resistance indicates widespread scepticism about the durability and fairness of these agreements.

In light of the uncertain US political landscape and the transactional nature of the proposed deals, GTRI has recommended that India take a cautious approach and prioritize long-term national interest over short-term diplomatic wins.

Read More -Will Nifty Slip Below 24,850 Or Bounce Back? Experts Decode Key Triggers

(With Inputs From ANI)