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Tariffs

US-India Trade Deal Hits Roadblock Amidst Disagreements on Import Duties

Strategic Insights

— 1 min read

Despite optimism on both sides, the US-India trade talks have hit a roadblock over disagreements on import duties for auto components, steel, and farm goods. US President Donald Trump's remarks on having a "very big" trade deal with India came hours after a news report quoting sources in the Indian side said that the talks had stalled due to the disagreements. The negotiations, which have been going on for months, are trying to finalize a trade agreement before July 9. India has been pushing for a rollback of the proposed 26% reciprocal tariff, along with concessions on existing US tariffs on steel and auto parts.

Key Takeaways:

  • The US-India trade talks have hit a roadblock due to disagreements on import duties for auto components, steel, and farm goods.
  • US President Donald Trump has said that India has proposed a "no tariffs" agreement for American goods, but Indian officials have reportedly been pushing for a rollback of the proposed 26% reciprocal tariff.
  • India has not opened up dairy in any of its free trade pacts signed so far, making the agricultural and dairy sectors challenging areas for duty concessions to the US.
  • The US negotiators have not agreed to the Indian demands, with officials from both countries suggesting that India could be among the first countries to strike a deal on the new July 9 US tariffs.
  • The Indian team, headed by chief negotiator Rajesh Agarwal, arrived in Washington on Thursday for the next round of trade talks, which aim to finalize a trade agreement before July 9.
  • The high tariffs announced by the US on April 2 were suspended by the Trump administration till July 9.

Statistics:

  • 26%: The proposed reciprocal tariff on US goods that India has been pushing for a rollback on.
  • July 9: The deadline for finalizing a trade agreement between the US and India.
  • 10: June 10, the date on which commerce minister Piyush Goyal said that India and the US were in the process of negotiating a fair and equitable trade agreement.
  • $: The value of the rare earths and magnets that China is reportedly agreed to supply to the US as part of the trade agreement with Trump.

Sources:

  • Reuters: "US-India trade talks hit roadblock over import duties - sources"
  • ABP Live: "US-India trade deal with 'no tariffs' agreement proposed by India, says Trump"
  • Contify.com: "US-India trade talks delayed due to disagreements on import duties"

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