When Can India Expect ‘Good News’ on US Tariffs? Commerce Minister Shares Update

Union commerce minister Piyush Goyal told the press on Saturday that the negotiations between India and the United States on a trade agreement were in a friendly environment, but refused to impose a time timeline on the same.

"I believe the talks are progressing in a very cordial atmosphere, and I have said many times that free trade agreements or trade talks are never based on deadlines. There is no agreement unless we fully address the interests of the nation - India's farmers, India's fishermen, India's MSME sector. The talks are progressing very well. The talks are ongoing and we will definitely inform you when we reach a decision," ANI quoted the minister as saying.

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Answering a question on whether the US President Donald Trump is very high on the tariffs imposed on imports to the country and when the country is likely to get a good news on that issue Goyal replied to the press conference that the media will know when the country has decided on the agreement.

One of the highest tariffs in the world is one that Trump has imposed on Indian imports 50 per cent. Besides a 25 per cent base tariff on what Trump describes as trade imbalance, his administration imposed an extra 25 per cent tariff in response to the New Delhi buying Russian oil during the war in Ukraine.

The geopolitical shift

The tone of geopolitics in the US has undergone a change after Donald Trump threatened to put a 100 per cent tariff on China. That occurred following the recent tighter export restrictions, i.e. levies and supply limitations on rare earths by the regime of Xi Jinping.

The re-alignment therefore could put in place a quicker trade agreement with India, where the US might be ready to provide 16-18 per cent access to tariffs, which is greater than 15 per cent in the case of EU and Japan but lower than 20 per cent in the case of Vietnam according to an evaluation by Global Trade Research Initiative (GTRI).

In the case of India, the aggression of Trump has been attributed to other reasons than just business. Reports credited to his behaviour was also based on the refusal of Modi to play along with the statement that the threat of a tariff was made to force a ceasefire with Pakistan in May during the operation of Sindoor against terror bases in Delhi.

Prime Minister Narendra Modi, frequently described by Trump as a “great, personal friend,” and his government have reacted tentatively to Mr. Trump’s uncertainties.

GTRI said a deal could happen quickly “because Washington wants it”.

An Indian delegation is in the US this week for the sixth round of talks that commenced in April but were interrupted in August due to Trump’s fury.

US treasury secretary Scott Bessent also distinguished India as part of a host of allies in a “China versus the world” scrimmage on rare earths, minerals used to manufacture magnets deemed essential to auto and electronic defense industries, 80 per cent controlled by China.

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The GTRI again sounded caution, stressing India must look out for its core interests. “India must hold fast to its red lines in agricultural, digital trade, e-commerce, and intellectual property, and be careful to avoid any anti-China clauses that could impede India’s strategic autonomy,” the think tank’s assessment said. Foreign minister S Jaishankar has assertedly noted these red lines repeatedly.

Experts have suggested the Americans are still likely to push for further market access in niche areas such as medical devices, dairy, and technology services.

However, in recent days, things have moved quickly as a result of larger geopolitical developments.

Washington's main thought is shoring up supply chains for productive capacity in its manufacturing sector. An agreement would allow both countries to lessen their dependence on supply chains tied to China.

“Ambassador-designate Sergio Gor was recently in India, and he met with all the stakeholders and had good meetings,” an official told news agency ANI. Gor met with Modi, too, giving him a photo signed by Trump as a gift, with a handwritten message: “Mr Prime Minister, you are great".

“The negotiating team from India is in the US, and they are trying to see if we can have a win-win solution between the two sides,” ANI quoted government sources as saying. “We are in a deeper discussion. We have seen export growth to US and it may continue. Around 45 per cent of our exports to the US remain out of tariff,” the sources further told the news agency.

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