Indian negotiators extend US stay in attempt to seal an interim trade deal

While India is seeking the elimination of reciprocal tariffs and additional duties such as those on steel, aluminium, and auto components — along with assurances that no future tariffs will be imposed — the US is seeking a broad-based opening of Indian sectors, from automobiles and whisky to agricultural items such as apples, corn and soya among others.

Sources aware of the talks said trade officials discussed rules of origin in the textile trade during the last round in India, where India is seeking lower tariffs in the US similar to those offered to other FTA partners. Labour-intensive sectors such as textiles and footwear are among India’s top demands.

Tense discussions on agricultural items come amid strong US demands to open the Indian market to genetically modified (GM) products and to remove regulations that require dairy products intended for food to be derived from animals not fed with internal blood meal.

Finance Minister Nirmala Sitharaman, in an interview to The Financial Express which was also published in The Indian Express Monday, said that agriculture and dairy were among the “very big red lines,” where a high degree of caution had been exercised in the talks with the US.

“Yes, we would love to have an agreement, a big, good, beautiful one; why not?” Sitharaman said.

Last week, President Donald Trump said the US and India “may” sign a “very big” trade deal, under which India would “open up”.

Meanwhile, Ashwani Mahajan, National Co-Convener of the Swadeshi Jagaran Manch (SJM), in a social media post Monday, said India’s “agriculture and small industries” cannot be sacrificed for US interests.

“No matter what US President Donald Trump says, there cannot be a trade deal with the US, because India cannot give what America is asking for. How can India accept that America’s GM and other agricultural products be allowed to enter the country? That India should allow non-veg milk and dairy? How can the country’s agriculture and small industries be sacrificed at the altar of America’s stubbornness?” Mahajan said.

Indian officials have indicated that diversifying oil and defence procurement is in the country’s strategic interest, and that sourcing more from the US could significantly help bridge the goods trade gap.

The Indian Express had reported earlier that India’s oil imports from the US jumped over 270 per cent year-on-year in the first four months of 2025, underscoring Delhi’s strategy of boosting American imports amid trade pact negotiations and diversifying crude oil sources in a volatile geopolitical and geo-economic environment.