With July 9 deadline looming, India resists US pressure on agriculture and dairy; negotiators extend stay in Washington for last-minute push.
New Delhi, June 30, 2025 –As the July 9 deadline for reciprocal tariffs nears, India and the United States have entered the final stretch of negotiations over an interim trade agreement. Talks are tense, with India holding firm on not opening its agriculture and dairy sectors, which Finance Minister Nirmala Sitharaman described as “red lines.”
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The Indian negotiating team, led by Special Secretary Rajesh Agrawal, has extended its stay in Washington beyond the initially planned June 27 deadline. The goal: to clinch a deal that prevents the imposition of a 26% reciprocal tariff on Indian exports to the US—announced by President Donald Trump earlier this year and temporarily paused for 90 days.
“There is no way we could do anything that would weaken our agriculture, our farmers’ position,” Sitharaman reiterated in an interview to The Financial Express.
If the interim deal falls through, Indian exports could face additional tariffs on steel, aluminium, and automobiles, some of which are already being levied at 50% or more.
🔍 Key Points in the Negotiations:
- US Demands: Greater access to India’s agriculture, dairy, services, and digital markets, including genetically modified foods.
- India’s Priorities: Lower duties for labour-intensive exports (textiles, leather), and market access for electronics, auto parts, and engineering goods.
- Agriculture Deadlock: India refuses to allow GM food imports or offer concessions in wheat, maize, or dairy—a sector India has never liberalised under any FTA.
- Tariff Timeline: The 90-day delay in US tariffs ends July 9; Indian exports still face 10% additional duties despite the pause.
- Ongoing Engagements: Recent back-to-back visits by both nations’ trade delegations, with India’s Piyush Goyal and US Commerce Secretary Howard Lutnick holding multiple ministerial-level discussions.
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🌐 Trade Context:
Negotiators are also debating sanitary and phytosanitary measures, digital trade rules, and technical barriers to trade. While this interim deal is critical, both sides aim to conclude the first full phase of a Bilateral Trade Agreement (BTA) by autumn 2025.
This marks one of the most pivotal trade moments in the recent India-US economic relationship, as both nations look to reset ties under evolving global trade dynamics.
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