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Trade deal with strategic ally India ‘very close’, says White House, as deadlock persists over farm sector

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Last updated: July 1, 2025 8:25 am
Admin 3 weeks ago
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Trade deal with strategic ally India ‘very close’, says White House, as deadlock persists over farm sector
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New Delhi: With only eight days left before Washington is set to reimpose reciprocal tariffs, the India-US trade negotiations remain deadlocked as New Delhi digs in its heels on agriculture related concessions.

Contents
Steep tariffs on the horizonTalks underway for a modular deal concept

The White House has also expressed optimism as Press Secretary Karoline Leavitt reiterated that the deal is “very close” calling India a “strategic ally”. It has raised hopes for a possible resolution before the July 8.

#WATCH | “Yes, the President said that last week (that the US and India are very close to a trade deal), and it remains true. I just spoke to our Secretary of Commerce about it. He was in the Oval Office with the President. They are finalising these agreements, and you’ll hear… pic.twitter.com/l9pzzjGhM5

— ANI (@ANI) June 30, 2025

The Indian team which is led by chief negotiator Rajesh Agarwal, continues discussions in Washington, yet New Delhi remains firmly opposed to lowering import duties on maize, soybeans, dairy, apples and nuts. These were the core demand from the US. For the Indian government, any move to ease tariffs on these items risks unsettling millions of small farmers. It also stands a risk of triggering domestic political backlash.

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Steep tariffs on the horizon

The looming July 8 deadline means that if no agreement is reached, exporters may face a steep 26 per cent reciprocal tariff from US markets. This move directed by US President Donald Trump is unlikely to be postponed.

Meanwhile, negotiators in America are reportedly unwilling to settle for partial concessions. They have insisted time and again that India must open agricultural quotas minimally.

Indian negotiators are distressed that any concessions made in sensitive sectors such as automobiles and whiskey they are not receiving sufficient benefits for products such as garments, home textiles, leather and footwear, engineering goods and auto components.

Talks underway for a modular deal concept

Both sides continue to work towards a modular deal despite the impasse over agriculture for the achievement of a modular deal concept. They are aiming for an initial “mini-deal” in advance of a broader bilateral agreement scheduled for September-October. Commerce Minister Piyush Goyal neither dismissed nor confirmed progress. There is a possibility that sectors that may get left out in the first round shot should not lose hope as more items might be added later.

Americans have virtually ruled out lowering tariffs by zero, at least immediately, officials have told exporters that even at a base tariff of 10 per cent, Indian exporters would gain a competitive edge over rivals who would face steeper reciprocal tariffs with the US.

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TAGGED:Commerce Minister Piyush GoyalDonald TrumpIndia-US trade talksRajesh Agarwal
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