US-India Trade Deal: Who Will Win If Deal Closes? From Automobiles To Almonds, These Sectors Could See Big Changes

India and the United States are in the final stages of critical trade negotiations that could shape their economic relationship for years to come. The talks are racing against time, with just days left before the July 8 deadline. This deadline is linked to President Trump’s 90-day suspension of special country-specific tariffs that he announced on April 2.

If no agreement is reached by July 8, India could face renewed tariff pressures, although experts believe it is unlikely that the US would reintroduce the steep duties immediately.

Aiming for a Limited Mini-Deal

The two countries are trying to secure a limited trade agreement, often referred to as a “mini-deal”, before the clock runs out. India’s top trade negotiator is currently in Washington, and both sides have been working intensely. The most likely outcome appears to be a scaled-down agreement modelled after the US-UK mini deal signed in May.

Under this plan, India would reduce its Most Favoured Nation tariffs on several industrial items, including automobiles, which has been a long-standing demand from Washington.

In the agriculture sector, India may allow limited access for US products such as ethanol, almonds, apples, avocados, wine, and spirits through modest tariff cuts and tariff-rate quotas. However, India is expected to protect its most sensitive sectors, like dairy, rice, and wheat, which are closely tied to rural livelihoods and food security for millions of people.

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Strategic Purchases and Retail Market Access

The deal could also include strategic commitments such as large-scale purchases of US oil, liquefied natural gas (LNG), civilian aircraft, and nuclear energy equipment. Additionally, India may face pressure to ease restrictions in multi-brand retail and import rules for remanufactured goods, which could potentially open the door for companies like Amazon and Walmart.

In return, the US would agree not to reimpose the harsher 26 per cent tariffs that were announced earlier this year.

Instead, a baseline 10 per cent tariff would apply to most Indian exports. However, the US is not offering to reduce its own MFN tariffs on Indian goods, which has raised concerns over fairness and lack of reciprocity in the deal.

Sensitive Sectors and Red Lines

On the other hand, the talks could collapse if the US insists on deeper access to India’s core agriculture sector or demands permission for genetically modified (GMO) products. India has firmly stated that such demands threaten food security and the livelihoods of over 700 million people who depend on agriculture.

While agriculture makes up a small portion of US exports to India, Washington is pushing aggressively for market access. Indian experts are worried that any compromise could lead to future demands that weaken India’s public procurement system and minimum support price (MSP) framework, which are critical parts of India’s farm policy.

Uncertainty Over Tariffs if Talks Fail

If negotiations break down, it is uncertain whether President Trump will reintroduce the earlier 26 per cent tariffs. Trade analysts believe this is unlikely since India was not among the most heavily targeted countries in the original tariff order. However, given Trump’s unpredictable policy style, nothing can be ruled out.

Regardless of how the talks end, trade experts caution that India must hold its ground and insist on a reciprocal, balanced, and transparent agreement. The Global Trade and Research Initiative (GTRI) has underscored that “Any trade deal with the US must not be politically driven or one-sided; it must protect our farmers, our digital ecosystem, and our sovereign regulatory space.”

Trump Hints at a Big Announcement

Earlier today, President Donald Trump hinted that a big trade deal with India could be announced soon. He said, “We're not going to make deals with everybody. Some we are just going to send them a letter saying thank you very much. You are to pay 25, 35, or 45 per cent. That's the easy way to do it, and my people don't want to do it that way. They want to do some of it, but they want to make more deals than I would do.”

He added, “But we're having some great deals. We have one coming up, maybe with India. Very big one. Where we're going to open up India in the China deal, we're starting to open up China. Things that never really could have happened, and the relationship with every country has been very good.”

Deadlock Over Tariffs and Market Access

According to Reuters, trade talks between India and the US have now hit a roadblock over disagreements on import duties for auto components, steel, and farm goods, dashing earlier hopes of reaching a deal before President Trump’s July 9 deadline to impose reciprocal tariffs.

The deadlock marks a sharp shift from the earlier optimism that followed Trump’s claim that New Delhi had proposed a “no tariffs” agreement for American goods. Officials from both countries had suggested India could be among the first to strike a deal on the new US tariffs.

India is pushing for a rollback of the proposed 26 per cent reciprocal tariff that is set to take effect on July 9, along with concessions on existing US tariffs on steel and auto parts. But US negotiators have not agreed to these demands yet.

Three Indian government officials told Reuters, “The US side first wants India to commit to deeper import tariff cuts on farm goods like soybeans and corn, cars, and alcoholic beverages along with easing of non-tariff barriers,” which has led to disagreements between the two sides.

These sources spoke on condition of anonymity because the discussions are confidential.

No Immediate Comment From Officials

India’s commerce ministry, the US Embassy in New Delhi, and the US Trade Representative’s Office did not immediately respond to requests for comment. An Indian delegation is expected to travel to Washington before the deadline, although discussions may now focus on a broader agreement rather than a rushed interim deal, according to a second Indian government source.

India’s Strategy and Long-Term Goals

Prime Minister Narendra Modi is trying to position India as a key US partner and attract American firms like Apple to diversify supply chains away from China, but trade talks have struggled to make headway.

One Indian official said, “We are keen, but not desperate, to sign a deal before the July 9 deadline,” adding that India has offered tariff cuts on almonds, pistachios, and walnuts and is willing to extend preferential treatment for American imports in sectors like energy, autos, and defence.

Another official said, “There hasn’t been much progress despite several rounds of talks,” though they did not rule out a last-minute breakthrough if Modi and Trump choose to intervene directly.

Future Trade Outlook

Despite the impasse, Indian officials continue to stress their long-term commitment to the US as a trusted economic partner while maintaining policy independence. Modi and Trump agreed in February to complete the first phase of a bilateral trade agreement by autumn 2025 and to expand trade to $500 billion by 2030, up from about $191 billion in 2024.

India is also advancing talks with the European Union for a free trade agreement later this year and has recently concluded negotiations for a free trade pact with the United Kingdom. These moves are aimed at hedging against possible US policy shifts under Trump.

Ram Singh, who heads the Indian Institute of Foreign Trade, a government-funded think tank, said, “The ball is now in the US court. India is not for any win-lose trade partnership.” Even in the worst-case scenario, a third Indian official said India could absorb the impact of reciprocal tariffs, noting that the country still enjoys a tariff advantage over competitors like Vietnam and China.

India’s exports to the US rose to $17.25 billion in April-May, up from $14.17 billion a year earlier, suggesting the 10 per cent US tariff hikes that took effect in early April had a limited impact.