India-US Trade Agreement: The ball is in America's court on the trade agreement; an interim deal can be done in two days

Posted on 7th Jul 2025 by rohit kumar

The decision on the India-US trade agreement now rests with the US, as the Indian government has clearly expressed its reluctance to open the agriculture and dairy sectors. Sources in the Indian government said, "We have drawn our red line. Now the ball is in their court." If the US Donald Trump administration agrees to the condition of refusing to open these sectors, then an interim trade agreement can be reached between the two countries before July 9.

 

A source said, "If the proposed trade talks fail, the 26 percent tariff will be re-imposed." President Trump had imposed retaliatory tariffs on most countries of the world on April 2. A 26 percent tariff was imposed on India. However, it was later postponed for 90 days so that all countries could enter into a fresh trade agreement with the US. A baseline tariff of 10 percent has been maintained on all countries. Trump's 90-day deadline is ending on July 9. India wants a complete exemption from the 26 percent tariff.

 

During Prime Minister Narendra Modi's visit to the US in February 2025, both countries had announced the start of negotiations for a bilateral trade agreement. For this, a deadline of September-October this year has been set. Before that, both countries were trying to reach an interim agreement to deal with Trump's tariffs.

 

Goyal has made it clear that national interest comes first in any deal.

 

Commerce Minister Piyush Goyal had said on July 4 that India will not be bound by a deadline in any trade agreement. It will accept any trade agreement only if it is final, all conclusions have been drawn correctly and the agreement is in the interest of the country. A free trade agreement is possible only if it is beneficial for both parties. For us, national interest comes first. If any agreement is reached, keeping this in mind, then India is always ready to agree with developed countries.

 

India has not yet opened the agricultural sector to any country.

 

A team of Indian trade negotiators went to the US and returned from there only last week. Sources say that there is a deadlock over tariffs on steel, aluminium (50%), and auto (25%). Apart from this, India has hardened its stand on not giving tariff exemption to American products in the agriculture and dairy sectors because both these are very sensitive issues in India, and the livelihood of crores of farmers is linked to them. Allowing other countries to enter these sectors can be disastrous for the farmers of the country. India has never opened its agriculture sector in a trade agreement with any country in the world before this.

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