Missed Call Sank India-US Trade Deal: Lutnick

US commerce secretary claims Modi-Trump call was key to sealing pact

January 9, 2026: US Commerce Secretary Howard Lutnick has claimed that a long-anticipated India–US trade deal collapsed because Prime Minister Narendra Modi did not make a final “closing” phone call to President Donald Trump. Speaking on the All-In Podcast on January 9, 2026, Lutnick said the agreement was ready but required direct leader-level engagement to be sealed during a critical negotiation window in early 2026.

Describing the Trump administration’s “staircase” trade strategy, Lutnick explained that countries which closed deals early received better tariff terms. He alleged that while the framework for India’s deal was complete, New Delhi hesitated to place the call, prompting Washington to move ahead with agreements involving Vietnam, Indonesia and the Philippines. According to Lutnick, the White House interpreted the absence of a call as a lack of urgency or commitment, noting that President Trump valued direct engagement to finalise deals.

The stalled pact was expected to address key friction points such as H-1B visa flexibility, agricultural market access and digital trade rules. The diplomatic breakdown now carries economic consequences, with Indian exports facing a 50% tariff in the US, including penalties linked to India’s Russian oil imports. Tensions have further risen after President Trump cleared a Russia sanctions bill that could raise tariffs to 500% on certain countries. India’s commerce ministry has yet to respond to Lutnick’s remarks.