Negotiations between India and the United States on trade tariffs are reaching a critical point, as officials from both sides meet in closed-door talks to finalize an interim deal before a July 9 deadline. The meeting, led by Rajesh Agrawal, India’s Chief Negotiator, focuses on reducing tariffs in sectors like agriculture and automobiles. This is a significant step towards potentially resolving trade tensions after President Trump self-imposed a deadline for finalizing the agreement.
Senior U.S. officials have expressed optimism regarding the progress of the talks, stating that early agreements could lead to better deals for both countries. Howard Lutnick, U.S. Commerce Secretary, highlighted the positive relationship between Trump and Modi as a key factor in smooth negotiations. He also emphasized that achieving market access in India is vital for American businesses.
India aims to secure significant tariff cuts, with plans to eliminate or significantly reduce tariffs on specific sectors like textiles, gems, agriculture products, and chemicals. The U.S., in return, seeks reductions in tariffs on industrial products, vehicles (particularly electric cars), wines, petroleum products, and agricultural goods.
The meeting comes amidst continued negotiations on a comprehensive trade deal that aims to boost bilateral trade between the two nations to $500 billion by 2030. India is seeking a reduction in tariffs from its current average of 39% to near zero, while the U.S. has requested reductions across various sectors. Both sides are also discussing key issues like agricultural imports and access to supply chains.
India, aiming for an accelerated deal, has indicated their willingness to offer more favorable terms compared to the UK’s response to the US demands, which included opening up farm markets.