With just about a week to go before the reciprocal tariffs kick in, a trade deal between India and the US is yet to be signed with both sides keen on protecting their interests.
According to sources, a last-ditch solution could be an initial deal covering partial goods of mutual interest. This could be signed before July 9 with the first tranche of the bilateral trade agreement being sealed in the coming months in September or October 2025.
“As of now, there remains no clarity on how to proceed on negotiations. Both countries have certain interests that they are keen on protecting. For India, it remains dairy and agriculture, which are sensitive issues. The US is interested in full access to these sectors,” said a source close to the development.
For now, a possible solution could be to cover some goods and services or only some goods of common interest such as labour-intensive goods including garments, leather, gems and jewellery from India while keeping other goods outside the ambit of the talks. But it is still hoped that a political push will help take forward the stalled talks.
The Indian delegation of officials led by chief negotiator and special secretary, department of commerce Rajesh Agarwal continues to be in the US and is working on ironing out these differences.
The plan to levy reciprocal tariffs by the US will kick in from July 9 after a 90-day pause. The US plans to impose a 26% tariff on Indian goods, including a 10% baseline tariff.
Sources said that as of now export orders to India from the US continue and remain unaffected. There is some frontloading of shipments ahead of the July 9 deadline. “Exporters remain hopeful of a deal. As of now, exporters are not facing any challenge as of now. There is a rush of shipments in most sectors, except in steel and aluminium where tariffs are already high at 50%,” said an industry source.
Some of these issues are also understood to have been discussed at the meeting of Commerce and Industry minister Piyush Goyal with Export Promotion Councils and Industry Associations on Monday.
