India, US in Race Against Time to Finalise Trade Agreement Before Tariff Deadline

Guwahati : With the July 9 deadline for suspended reciprocal tariffs approaching, the US and India are working hard to conclude a long-delayed bilateral trade deal. US President Donald Trump on Tuesday indicated that the two countries are "going to have a deal" that will allow fairer competition due to "much lower tariffs,".

Addressing the ongoing talks, Trump asserted, “It’s going to be a different kind of deal. It will allow us to compete. Right now, India doesn’t accept anybody in. But if that changes, we’ll have a deal with much less tariffs.” He added that India appears ready to lower trade barriers, which could open up access to the South Asian market for American businesses and avert the reimposition of steep tariffs.

The 26 per cent mutual tariff, announced by the US on April 2, was suspended for 90 days. If not resolved, it will automatically come into effect on July 9, potentially inflating trade tensions between the two nations.

As per government reports, India has been firm on defending its agriculture sector a highly sensitive region given the existence of small-scale subsistence farming. India has consistently declined to open up its dairy market to overseas players and is still being guarded despite US pressure.

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The US wants to have lower tariffs on important farm exports such as apples, tree nuts, and genetically modified agricultural products. India is asking for improved access for its labour-intensive products such as textiles, garments, gems and jewellery, leather products, and some farm items like shrimp, oilseeds, grapes, and bananas.

Talks that were to take place on July 3 and 4 have now been extended, with Indian Chief Negotiator Rajesh Agrawal and his delegation staying on longer in Washington in a final attempt to finalize the interim agreement.

The stakes are high, with both sides setting an ambitious goal of more than doubling bilateral trade from $191 billion now to $500 billion by 2030. The result of these talks can set the future course of US-India economic ties for the next decade.