The US has pulled out of the next round of talks, which has caused problems in bilateral negotiations. Tariffs and market access are two main sources of contention.
August 17, New Delhi: The United States has walked out of the next round of trade discussions with India, which were supposed to take place in New Delhi on August 25. This is a big blow to the negotiations that are already going on. According to sources in the administration, the US trade delegation will not be going to India for the sixth round of talks. This raises new questions about the long-awaited Bilateral Trade Agreement (BTA).
The move comes at a very important time. The US and India have already had five rounds of talks, the most recent of which took place in Washington, D.C. from July 14 to 18, 2025. Both parties have been working on a temporary trade pact that would deal with important problems such tariff cuts, access to markets, digital trade, customs procedures, and regulatory hurdles like Technical hurdles to Trade (TBT) and Sanitary and Phytosanitary (SPS) measures.
What Stopped the Talks
Indian officials had been cautiously hopeful, but US President Donald Trump took a firm position and said, “There will be no trade talks until tariffs are settled.” His comments come after a string of aggressive tariff increases that have made relations between the two countries worse than they have been in years.
On Wednesday, the White House signed an Executive Order that added 25 percentage points to the taxes on Indian goods, bringing the total to 50%. The directive said that India’s continuous purchases of Russian oil, both directly and indirectly, were a reason for the emergency measures. It further said that these actions were necessary for “national security and foreign policy concerns.”
On August 7, the first round of tariffs went into effect. They were 25% on everything except drugs, semiconductors, electronics, and energy supplies. The new 50% duty will apply to all Indian goods that enter US ports, except for certain categories or goods that are already on their way. This will happen within 21 days.
When ANI asked Trump in the Oval Office if talks could start up again because of the new tariffs, he was very clear: “No, not until we get it resolved.”
India’s Defiant Answer
During his speech at the MS Swaminathan Centenary International Conference in New Delhi, Prime Minister Narendra Modi made it clear that India will not give up its farmers’ interests, even if it cost a lot.
Modi remarked, “The interests of our farmers are our top priority.” “India will never put the needs of farmers, fishermen, and dairy farmers ahead of its own.” I know it will cost us a lot, and I’m ready for that. “India is ready for it.”
India has long been against letting international competition into sensitive areas like dairy and agriculture because it could hurt the livelihoods of millions of rural communities.
The Bigger Picture: A $500 Billion Goal at Risk
Earlier this year, Prime Minister Modi went to Washington, where the two countries agreed to an ambitious goal of increasing commerce between them to $500 billion by 2030. The first part of the BTA is projected to be finished by the fall of 2025. But the growing trade conflict could potentially throw this plan off track.
Sunil Barthwal, the Secretary of Commerce, stressed that talks are still going on at several levels, including technical teams, ministers, and diplomats. “The US is a very important partner for us.” He stated, “India is also an important partner for the US,” and he stressed that talks with industry and other stakeholders are still going on to protect weak export industries.
A high-ranking government official said that New Delhi is keeping a careful eye on how US tariffs affect the economy, especially in industries that rely heavily on labor. At the same time, the government is working on ways to diversify its exports to the EU, UK, and other global markets.
What’s Next
Even though things looked good in earlier rounds, the most recent events show that the relationship between India and the US is getting worse. The talks that have stopped, together with Trump’s refusal to budge, have made it unclear if the ambitious trade goals can still be reached by the set deadline.
For now, both countries are still trying to keep things in balance, which is very important to farmers, exporters, and global markets.