US-India trade deal talks stall over agri imports, tariffs
What's the story
India and the US are facing major hurdles in their proposed trade deal. The Indian government has pushed back against US demands for lower-duty imports of agricultural products like maize and soybean. The move is aimed at protecting local farmers and addressing health concerns associated with genetically modified foods. The negotiations have reportedly hit a roadblock, with no limited agreement in sight before the July 9 deadline.
Industry concerns
Limited deal deadline
If a limited deal isn't reached by July 9, the Indian industry may have to face a 26% levy. This is particularly concerning as many within the Indian government believe that the 10% baseline tariff offered by the Trump administration is not enough. Commerce Minister Piyush Goyal had said last week that trade agreements only work when they lead to a "win-win" situation for both parties involved.
Negotiation dynamics
India's initial hopes and demands
Initially, India had hoped to secure zero-duty access for a number of products such as textiles, leather goods, pharmaceuticals, some engineering goods, and auto parts. However, American negotiators have made it clear that the Trump administration cannot immediately agree to zero tariffs. Despite this setback, India has sought protection from future tariff actions once a deal is finalized.
Diplomatic tensions
Diplomatic row over 'pause' claim
The atmosphere for resolving trade-related issues has also been marred by India's discontent over US President Donald Trump's claim of having brokered a peace deal between India and Pakistan. This was later rejected by Prime Minister Narendra Modi. The diplomatic tension further complicates the already difficult negotiations between India and the US on their proposed trade deal.