Tariff cuts, market access for US firms on the table; dairy sector a sticking point
US President Donald Trump on Tuesday expressed hope that a trade deal with India is close to being finalised. He said the agreement would lower tariffs and allow American companies greater access to the Indian market.
Speaking to reporters aboard Air Force One, Trump said India was ready to cut taxes for US firms, which could help avoid the steep 26% tariff he had earlier announced on April 2.
While that tariff hike was put on hold for 90 days, a 10% duty has remained in place. The pause is set to expire on July 9.
“I think we are going to have a deal with India… a deal for less, much less tariffs,” Trump said.
“Right now, India doesn’t accept anybody. I think India is going to do that.”
However, the negotiations have hit a stalemate, especially over agricultural products. India is refusing to allow US dairy imports, citing concerns about its dairy sector, which supports over 80 million people, many of them small farmers.
“There is no question of conceding on dairy. That’s a red line,” a senior Indian official told India Today TV.
According to Reuters, Indian trade officials visited Washington last week to fast-track a deal before the deadline. Special Secretary Rajesh Agarwal, who is leading the Indian team, has extended his visit by a day to break the impasse.
US Treasury Secretary Scott Bessent said talks are progressing well.
“We are very close with India,” he told Fox News.
He added that the deal would lower tariffs and help India avoid higher duties starting next week.
If talks fail, India’s current 10% tariff could jump to 27%, affecting many US products. India is among more than a dozen countries trying to avoid the upcoming tariff hikes from Washington.
Meanwhile, External Affairs Minister S. Jaishankar, speaking in New York, said both sides will need to show flexibility.
“We are hopefully more than halfway through a very intricate trade negotiation,” he said.
“There will have to be give and take.”
Jaishankar was in the US to attend meetings of the Quad, a four-nation security group focused on the Indo-Pacific.
The outcome of the trade talks is expected to have major implications for US-India economic ties, especially in a year when global trade tensions are already high.
