New Delhi: After Indian negotiators finished the fifth round of negotiations in Washington, a US team led by the US Trade Representative for South and Central Asia, Brendan Lynch, is expected to visit India in mid-August to continue negotiations for a trade agreement.
While India and the US have agreed on a wide range of tariff lines, the negotiations — which currently only involve market access for goods — are stuck over sensitive sectors such as agriculture and automobiles, which are key job creators in India, according to reports.
The new round of talks beyond the August 1 deadline comes amidst growing suspense over whether India will face 26 per cent reciprocal tariffs starting August 1. Commerce Secretary Howard Lutnick said last week that August 1 is a “hard deadline” for countries to begin paying tariffs.
“That’s a hard deadline, so on August 1, the new tariff rates will come in… Nothing stops countries from talking to us after August 1, but they’re going to start paying the tariffs on August 1,” Lutnick said in a TV interview.
President Donald Trump’s deadline for implementation of reciprocal tariffs has shifted from April 1 to July 9, and now to August 1. While Trump has reiterated that a deal with India is close, India could face tariffs of up to 26 per cent if both countries fail to reach an agreement.
Government officials have maintained that India is aiming to sign a bilateral trade agreement (BTA) by the end of the year, which would provide market access in labour-intensive sectors and ensure a significant tariff differential compared to its Asian peers.
A US trade deal with tariffs on labor-intensive Indian products at a lower rate than some of the competitors would be a "big advantage" and present an opportunity, according to NITI Aayog Vice Chairman Suman Bery.
