India-US trade deal: With just two days remaining until US President Donald Trump’s reciprocal tariff deadline, the possibility of a trade deal between India and America is dimming, though officials have not ruled out any last-minute breakthrough. Trump had announced a 26% tariff rate for India on April 2, which was later suspended. Will India face a 26% reciprocal tariff from August 1? Trump has said that a deal with India has not yet been finalized and that a tariff rate is being considered, though not decided.Donald Trump administration officials have indicated that more negotiations are needed with India before a trade deal can be sealed. What’s the status of the trade talks and what are the sticking points? We take a look at top 10 recent developments on India-US trade deal talks, Trump’s tariff threats and more:1) Trump’s 20-25% Tariff StatementTrump has said that the trade deal with India is not yet final. “When questioned about potential 20-25% tariff rates on India, he said, “Yeah, I think so. India is my friend. They ended the war with Pakistan at my request…The deal with India is not finalised. India has been a good friend, but India has charged basically more tariffs than almost any other country…”.He noted that whilst discussions are ongoing, the final tariff percentage has not yet been decided.Also Read | India-US trade deal: Donald Trump says not finalized; hints at 20-25% tariff rate two days ahead of reciprocal tariff deadline2) India Braces for TariffsIndia is getting ready for a 20-25% US tariff rate, according to a Reuters report. Government sources told the news agency that India expects to face higher US tariffs on specific export products as a temporary measure.“Talks are progressing well, and a delegation is expected in Delhi by mid-August,” one Indian government official said, adding that President Donald Trump could issue a tariff letter imposing duties of 20 or 25% in a “worst-case scenario”.“However, we assume it would be a temporary measure, considering the five rounds of trade talks that have taken place. A deal will soon be worked out,” the official was quoted as saying.3) ‘More Negotiations’ NeededUS Trade Representative Jamieson Greer on Tuesday indicated that more negotiations are necessary for a trade deal.According to a Bloomberg report, Greer said, “We continue to speak with our Indian counterparts, we’ve always had very constructive discussions with them.”He further elaborated, “They have expressed strong interest in opening portions of their market, we of course are willing to continue talking to them,” and added, “But I think we need some more negotiations on that with our Indian friends to see how ambitious they want to be.”4) No Letter for India YetWhile Trump has hinted at a 20-25% tariff rate for India, it’s important to note that India has not yet been sent any tariff letter by the US President. Over the last few weeks, Trump has sent out letters to over 20 countries communicating their new tariff rates effective August 1. Also Read | ‘More negotiations needed…’: Trump administration official shares update on India-US trade deal; no agreement before August 1 deadline?5) US Team to come to IndiaA US delegation is scheduled to arrive in India on August 25 to continue discussions regarding the bilateral trade agreement. Meanwhile, both countries remain actively engaged in resolving differences to achieve an interim trade agreement before August 1,. “The US team is visiting for the sixth round of talks,” an official has said. The first phase of the trade deal is expected to be finalized by fall.6) Will the August 1 reciprocal tariff deadline be extended?Trump’s reciprocal tariffs for countries will be effective August 1, 2025, without any further delays, Commerce Secretary Howard Lutnick has said. Lutnick has said that fresh tariffs would take effect on August 1 for the targeted nations.“So no extensions, no more grace periods. August 1, the tariffs are set. They’ll go into place. Customs will start collecting the money, and off we go,” Lutnick has said.Also Read | Trump tariff war: Deal or no deal – why it won’t matter much for India7) India Wants ‘Preferential Access’Trade negotiations between India and the US are well, Commerce Minister Piyush Goyal said last week.“We’re making fantastic progress with the United States, and I do hope we’ll be able to conclude a very consequential partnership,” Goyal said.Significantly, Goyal emphasised that India seeks advantageous market access to the US in comparison to its competitors.“All options are on the table, and we will see how it plays out, but what is important is to get preferential market access over our competitors, our peers,” he added.8) India maintains cautious stanceIndia maintains a cautious stance in its trade talks with the US, influenced by the complexities surrounding America’s recent trade deal with Japan and the unresolved agreements announced by Trump with Indonesia and Vietnam.An ET report indicates that the US-Japan trade agreement has encountered significant interpretation differences between both nations regarding its terms and conditions. This situation has prompted India to adopt an increasingly vigilant approach in its trade discussions.US officials claim that Japan has committed to investments in America, with local taxpayers set to receive ninety per cent of profits. However, Japanese representatives counter this assertion by stating that no written agreement has been formalised.Also Read | ‘No legal basis’: Amidst India-US trade deal talks, America says India has no grounds for retaliatory tariffs at WTO; here’s what the issue is about9) Sticky points in trade dealIndia has so far refused to open its agriculture and dairy sector as part of the discussions for a trade deal. The US on its part is insisting on higher market access for its products, particularly in these two sectors.For India agriculture and dairy are sensitive sectors – both economically and politically. Some reports have suggested that if an interim deal is announced, it is likely to leave out these two sectors for now.10) US sanctions & tariff threatsApart from the ongoing trade deal discussions, Trump has been threatening to impose a flat 10% tariff rate on all BRICS group nations, of which India is also a part. Trump has mocked BRICS for its attempts to attack the dominance of the dollar.Also Trump has spoken of 100% secondary tariffs on countries purchasing crude oil from Russia. His warning, if it comes into effect, would impact countries like India and China which are the largest importers of Russian crude oil.
