Trade Deal Chaos? India-US ‘Mini Deal’ Stalls As Tariff Deadline Looms

India-U.S. Trade Deal: India's trade negotiation delegation sent to the U.S led by Rajesh Agarwal, Special Secretary under the Ministry of Commerce, has arrived back in New Delhi on Friday, July 4, 2025.

Meanwhile, stalemate on sensitive areas like agriculture, auto, steel and aluminium sector continues according to sources. 

The Indian delegation was in Washington for negotiations on an interim trade agreement with the U.S. from June 26, 2025 - July 2, 2025.

These talks were imperative with U.S. President Donald Trump's reciprocal tariffs imposition deadline of July 9 inching closer.

The two sides are looking at finalising the talks before that occurs.

India was expected to not budge on its stance for verticals like agriculture, however, no furtherance towards meeting a mutual agreement was possible.

Sharing his stance on the India-US trade pact, Minister of Commerce, Piyush Goyal said “won't sign any deal under deadline”, signalling only a mutually beneficial deal would see the daylight. 

India has also strengthened its position on giving duty concessions to American farm and dairy products as these are politically sensitive sectors.

On April 2, the US imposed an additional 26 per cent reciprocal tariff on Indian goods but suspended it for 90 days. However, the 10 per cent baseline tariff imposed by the U.S. remains in place. Meanwhile, India continues to seek complete exemption from the additional 26 per cent tariff.

India has not opened up the dairy sector for any of its trading partners in free trade pacts the country has signed so far.

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The US also wants duty concessions on certain industrial goods, automobiles, especially electric vehicles, wines, petrochemical products, and agricultural items like apples, tree nuts, and genetically modified crops.

India is seeking duty concessions for labour-intensive sectors like textiles, gems and jewellery, leather goods, garments, plastics, chemicals, shrimp, oil seeds, grapes, and bananas in the proposed trade pact.

The two countries are also seeking to conclude talks for the first tranche of the proposed bilateral trade agreement (BTA) by fall (September-October) this year. The pact is aimed at more than doubling bilateral trade to USD 500 billion by 2030 from the current USD 191 billion.

Before the first tranche, they are trying for an interim trade pact.

Currently, India's merchandise exports to the US surged by 21.78 per cent to USD 17.25 billion in April-May this fiscal, and imports increased by 25.8 per cent to USD 8.87 billion.