The United States’ top trade official has indicated that “more negotiations” will be necessary to secure a trade deal with India, a sobering assessment that comes just days before a critical August 1 deadline, after which higher US tariffs are scheduled to take effect.
US Trade Representative Jamieson Greer, speaking in an interview on CNBC on Monday, stated that Washington needs additional talks to gauge just how ambitious the Indian government is willing to be to secure a comprehensive trade agreement.
While Greer acknowledged that he had previously suggested a deal with New Delhi might be imminent, he emphasized the significant policy shifts that would be required from India.
He highlighted India’s historic policy of “strongly protecting their domestic market,” noting that any move to reduce these long-standing barriers would represent a major reversal.
“We continue to speak with our Indian counterparts, we’ve always had very constructive discussions with them,” Greer said.
They have expressed strong interest in opening portions of their market, we of course are willing to continue talking to them. But I think we need some more negotiations on that with our Indian friends to see how ambitious they want to be.
Greer explained the fundamental challenge in the negotiations: “The thing to understand with India is their trade policy for a very long time has been premised on strongly protecting their domestic market. That’s just how they do business.”
He contrasted this with the Trump administration’s objective: “And the president is in a mode of wanting deals that substantially open other markets, that they open everything or near everything.”
An elusive agreement despite months of optimism
Greer’s comments come just a few days after Indian Commerce Minister Piyush Goyal had expressed his own optimism that an agreement could be reached to avert the threatened 26% tariffs.
Goyal had insisted there weren’t any major sticking points in the U.S.-India relationship and had noted that sensitive immigration rules, including those around H-1B visas for skilled workers, had not come up in the trade talks.
Despite these repeated claims from both sides in recent months that an agreement was within reach, a final trade deal between India and the US has remained elusive.
This is particularly notable as the US, over the last few days, has successfully signed trade deals with other major economies, including Japan and the European Union.
Furthermore, US and Chinese economic officials resumed their talks in Stockholm, Sweden, on Monday, with a previous tariff and export control agreement from May having an August 12 deadline that experts believe may be extended.
In contrast, there has been no major public breakthrough on the trade deal front between the US and India.
Last Thursday, July 24, India’s Ministry of External Affairs (MEA) did state that India and the US are working towards finalizing the “first tranche of a mutually beneficial, multi-sector Bilateral Trade Agreement (BTA),” but concrete details have been sparse.
Sticking points and external pressures: why is a deal delayed?
Hopes had been high that a trade deal between India and the US could be finalized before an earlier deadline of July 9, which had been set by President Donald Trump for the new tariffs to take effect.
However, despite several rounds of talks and reports suggesting that President Trump was expected to make a final decision, no agreement materialized.
A key point of contention has reportedly been the US’s insistence on gaining greater access to Indian markets for its agricultural, dairy, and genetically modified (GM) products.
India, however, has consistently argued that granting such access could negatively impact the livelihoods of its large farming population, a politically sensitive issue for the Indian government.
Another potential reason for the delay in finalizing the trade deal is the US’s broader geopolitical stance, particularly its opposition to countries importing oil from Russia.
Last week, US Senator Lindsey Graham issued a stark warning that President Trump intends to impose steep tariffs on any countries that continue to import oil from Russia, a policy that could have significant implications for India.
These complex and multifaceted issues continue to complicate the path to a final agreement.
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