US team visit ‘halted’ for now, trade talks with India stuck

The breakdown in trade talks assumes significance as US President Donald Trump has announced 50 per cent tariff on Indian products, the highest on any country globally.

On August 7, too, after Trump announced the additional 25 per cent tariff on Indian goods, Modi had said that he would not compromise “even if it entailed paying a very heavy personal price”.

The government official quoted above indicated that there are no talks with the US, not even any backchannel negotiations to dial down the tensions. (Express File)

The India-US negotiations for a trade deal, which began in February after Prime Minister Narendra Modi visited the United States, have been paused with the scheduled visit of officials from Washington DC to India in the second half of August “halted” by the US for now, a source aware of the development told The Indian Express.

The breakdown in trade talks assumes significance as US President Donald Trump has announced 50 per cent tariff on Indian products, the highest on any country globally. While 25 per cent tariff has already come into effect, government officials have said the levy of another 25 per cent – for Russia oil trade — could depend on “how geopolitical events unfold”.

The Indian Express had first reported on August 8 that the arrival of the US trade team was uncertain, as no formal communication had been received from their side.

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Deal stuck over agriculture

The deal has been stuck over India’s long-standing stance of protecting farmers in every trade agreement. The US, under Trump, is prioritising market access for its agricultural products.

In his Independence Day speech on Friday, Prime Minister Narendra Modi reiterated that India would not compromise on the well-being of its farmers, fisherfolk and cattle keepers, amid the standoff with the US over access for American products in India’s agriculture and dairy market.

On August 7, too, after Trump announced the additional 25 per cent tariff on Indian goods, Modi had said that he would not compromise “even if it entailed paying a very heavy personal price”.

Also Read | Agri red lines: India’s last-minute pullout from RCEP offers cues to why the US trade talks have hit a wall

The geopolitical factor

The uncertainty over when the tariffs on India could ease may drag on, as Trump’s high-stakes talks with Russian President Vladimir Putin did not result in a Russia-Ukraine ceasefire. However, Trump said he and Putin had made progress during the meeting in Alaska.

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US Treasury Secretary Scott Bessent has warned that the secondary tariffs on India could increase if “things don’t go well” during the Trump-Putin talks. “I think everyone has been frustrated with President Putin. We expected that he would come to the table in a more fulsome way. It looks like he may be ready to negotiate. And we put secondary tariffs on the Indians for buying Russian oil. I could see, if things don’t go well, then sanctions or secondary tariffs could go up,” Bessent said in an interview with Bloomberg earlier.

Ravi Dutta Mishra

Ravi Dutta Mishra is a Principal Correspondent with The Indian Express, covering policy issues related to trade, commerce, and banking. He has over five years of experience and has previously worked with Mint, CNBC-TV18, and other news outlets. ... Read More

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