India refuses to fast-track US trade deal, refuses to rush into deal: Report | Today’s news
India has refused to fast-track an interim trade deal with the United States after recent talks failed to resolve key differences, insisting it will only sign a deal that serves its long-term interests, according to a Reuters analysis.
Despite months of discussions, India and the US were unable to finalize a limited trade agreement during this time US Trade Representative Jamieson Greer’s visit to Delhi last month. Reuters reported that both sides expected an interim pact to be within reach, but talks had stalled over India’s core demands.
According to an Indian government official familiar with the talks, Washington has not provided assurances on two main issues: securing a tariff advantage over rival exporters such as China and ensuring that no other US tariffs will be imposed after the agreement is signed.
“Our position is clear – we have no intention of rushing into a deal that is not on favorable terms or a compromise on red lines, such as ceding land for agriculture,” the official told Reuters.
The report said Washington had hoped to secure swift trade concessions from India before tariffs proposed by President Donald Trump are implemented later this month. However, India’s decision to shelve the deal raises the possibility of higher tariffs on Indian exports and prolonged uncertainty for businesses.
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A day after the meeting with Greer, Commerce and Industry Minister Piyush Goyal said publicly that India would not pursue a trade deal unless it offered a clear advantage, signaling New Delhi’s tougher negotiating stance despite the risks additional US duties.
According to Reuters, most Indian exports to the United States are currently subject to a 10% tariff. The Trump administration is expected to impose steeper tariffs later this month through an investigation into industrial overcapacity. Washington has also proposed tariffs of up to 12.5% on several countries, including India, over allegations related to forced labor in supply chains, which India has denied.
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An improving economy increases India’s bargaining power
India’s stronger economic performance has significantly improved its negotiating position, trade analysts told Reuters.
India’s merchandise exports rose by around 15% during the April-June period compared to the same period last year, despite the disruption caused by the Iran conflict. The increase was mainly due to deliveries of higher value oil.
Exports to Gulf countries recovered to pre-war levels, rising to $5.3 billion in May from $2.62 billion in March after exporters switched to alternative shipping routes. Exports to the United States also increased, reaching $17.29 billion during April and May, Reuters reported.
India has also diversified its trade partnerships. A free trade deal with the UK is expected to come into force this month, while negotiations on a trade deal with the European Union continue, with a deal expected early next year.
Wendy Cutler, senior vice president of the Asia Society Policy Institute and former US trade representative, said Reuters“India’s negotiators gained some leverage in the talks, given its strong economy, diversification initiatives with other partners and its strategic position in the world”.
Goldman Sachs economist Santanu Sengupta also said in a report that the US-Iran interim peace deal has improved India’s economic outlook thanks to easing oil prices. The investment bank raised India’s growth forecast for 2026 to 6.8%, while cutting inflation and current account deficit projections, giving New Delhi more room to negotiate.
A weaker rupee has also strengthened the competitiveness of Indian exporters and further strengthened India’s position, the report added.
