New Delhi: The proposed trade agreement between India and the United States has hit a roadblock, with Indian negotiators pushing back against Washington’s demand for lower import duties on American agricultural products such as maize and soybeans. Concerns over the potential impact on domestic farmers and the risks associated with genetically modified (GM) foods are central to India’s resistance, according to official sources.
Talks, which had shown early promise, have now stalled just weeks ahead of the July 9 deadline. Without a breakthrough, Indian exporters may face a 26% levy, with government sources indicating that the US proposal of a 10% baseline tariff—applicable to all trading partners—is not seen as sufficiently beneficial for India.
India had initially sought zero-duty access for key sectors including textiles, leather, pharmaceuticals, engineering goods, and auto components. However, American negotiators have conveyed that immediate zero tariffs are unlikely, although they remain eager to finalize the deal.
India has also demanded protection from any future tariff hikes once the agreement is in place, seeking a more predictable trade environment.
Meanwhile, diplomatic tensions may be adding to the deadlock. Indian officials remain displeased over US President Donald Trump’s claim—later dismissed by Prime Minister Narendra Modi—that he had brokered a pause in Operation Sindoor, a claim that has done little to foster trust amid sensitive trade negotiations.
Unless significant progress is made soon, both sides risk missing the window for a limited trade pact, which would leave Indian exporters exposed to steeper US duties.
