The US group will go to India on August 25 — effectively after the looming deadline — for the sixth spherical of negotiations for the proposed bilateral commerce settlement between the 2 nations, an official instructed PTI on Tuesday. India faces the sturdy chance of punitive tariffs from the US, a improvement that would ship ripples by means of its export economic system and broader diplomatic ties with Washington.
Tariff menace: A sword hanging over India's head
The trajectory of US-India commerce negotiations has turn into emblematic of a broader sample in Washington's commerce posture below President Donald Trump. What started as a bilateral dialogue aimed toward resolving market entry points and addressing tariff asymmetries has advanced right into a high-pressure bargaining train marked by missed deadlines and implicit threats.
Initially slated for July 9, the deadline for concluding the interim commerce deal was prolonged to August 1 by Trump, ostensibly to present negotiations extra room. Nevertheless, the scheduling of a sixth spherical of talks for August 25 strongly indicators that no settlement will likely be reached in time to fulfill the brand new deadline. This delay, whereas maybe reflecting the complexity of the deal, is unlikely to be considered sympathetically by a White Home that has more and more framed commerce as a high-stakes, zero-sum sport.
Trump has already proven a willingness to make use of tariffs as a device of leverage in commerce negotiations, not simply with strategic rivals like China, however with allies and companions alike. India, although spared from a tariff notification letter after the July 9 deadline handed, stays very a lot within the crosshairs. The administration's hesitation to behave then could have been strategic: a calculated transfer to maintain India on the desk with out escalating tensions prematurely.
However the upcoming August 1 deadline carries extra urgency. Trump might reassert his trademark coercive techniques, utilizing tariffs to stress India into quicker concessions. The chance is amplified by the present political tone in Washington, the place commerce offers are more and more judged by their pace and assertiveness relatively than the nuances of diplomacy.
Combined indicators from the Trump administration
On this context, current remarks made by Treasury Secretary Scott Bessent stand out as a uncommon, moderating voice. His assertion that “high quality issues greater than timing” suggests a recognition of the complexity concerned in crafting a sustainable and equitable commerce deal. “We're not going to hurry for the sake of doing offers,” Bessent instructed CNBC in an interview practically every week in the past. Nevertheless, he mentioned that tariffs would possibly re-enter the negotiation toolkit if progress stalls, successfully undermining the very warning he advocates. “We'll see what the President desires to do,” he mentioned. “However once more, if we someway boomerang again to the August 1 tariff, I might assume {that a} increased tariff stage will put extra stress on these nations to provide you with higher agreements.” This duality — between a push for high quality and a readiness to make use of tariffs — mirrors the broader contradictions within the Trump administration's commerce strategy. Whereas the US claims to be looking for mutual profit, the reliance on deadlines, threats and unilateral stress factors to a method of deal-making by domination relatively than dialogue.
India now finds itself in a fragile place. With little time left earlier than the August 1 deadline, and no additional negotiations scheduled till August 25, it should brace for the financial and diplomatic fallout of potential US tariffs. Key export sectors corresponding to prescribed drugs and textiles could possibly be hit laborious by sudden commerce obstacles. Furthermore, the imposition of tariffs would inject recent pressure into an already complicated bilateral relationship, one which spans not simply commerce but in addition protection, regional safety and know-how cooperation. If Washington proceeds with punitive measures, it dangers alienating one in every of its key strategic companions in Asia at a time when counterbalancing China is excessive on each nations' agendas.
As August 1 approaches, India faces an unenviable scenario: a deadline and not using a deal, and a accomplice unwilling to attend. The scheduling of the subsequent spherical of talks for August 25 makes all of it however sure that the 2 sides will miss the present window for an interim settlement. What stays to be seen is whether or not Trump will act on his threats or maintain off as soon as extra within the hope of securing a greater, extra secure consequence later.
Whatever the instant consequence, the broader takeaway is evident: India should put together for a extra transactional and turbulent commerce relationship with the US, the place stress and tempo more and more trump persistence and course of.
