India and the United States resumed high-stakes trade talks today in New Delhi, aiming for a “mini deal” before July 8. That’s when India’s own retaliatory tariffs on American goods are due to kick in—unless a deal lands first.
At the center of these urgent discussions: steel, aluminium, automobiles, edible oils, and now, defence imports. All of this, triggered by the 50% Trump-era tariffs on metals that just took effect.
If the talks go well, India could see cheaper edible oils, smoother EV imports, and possibly even lower costs on American tech and defence goods. If they don’t? Prices on everything from nuts to electric cars could spike—fast.
India is walking a tightrope: fight tariffs, open markets, and still stand its ground.
“We need a deal that works for India, not just a deal that works fast,” a commerce ministry official told Moneycontrol.
Defence Gets Drafted In
This time, defence has entered the room. The US isn’t thrilled about India’s arms shopping in Russia, which still accounts for 36% of India’s military imports. But New Delhi may be open to pivoting more towards American suppliers—strategically and diplomatically smart, especially amid current global tensions.
Speaking at the USISPF in DC, US Commerce Secretary Howard Lutnick said, “India buying from Russia gets under America’s skin.”
Apparently, Delhi’s listening. Quiet moves are being made.
Also Read ‘Worse Than Covid’: Trump’s Trade War Is Crippling Poor Nations, Says IMF
Auto Wars: India vs the 25% US Tariff
Then comes the automobile standoff. The US wants more access to India’s auto market. India? Wants Washington to cut the 25% duty on cars and parts, especially as it tries to turbocharge its electric vehicle push.
Just days ago, India rolled out a new EV scheme: foreign automakers can bring in a limited number of EVs at a reduced 15% duty—if they promise to invest ₹4,150 crore to make EVs in India within three years. Smart move? Maybe. But Washington wants more.
And Delhi isn’t just waiting. On June 3, India officially challenged US auto tariffs at the WTO, calling them illegal protectionist moves.
Food, Fuel & Future Deals
India may agree to boost imports of US energy, including LNG, crude, and shale gas, along with edible oils like soya and sunflower. The US, meanwhile, is pushing to sell more apples, tree nuts, and even dairy to India.
This mini deal is the appetizer. A broader trade pact, possibly dropping around September–November, is expected to cover even more ground.
And that big, shiny Bilateral Trade Agreement (BTA)? Officials say it’s coming by late 2025. With it, India and the US hope to double trade volumes to $500 billion by 2030.
Call it a mini deal if you want—but with tariffs rising, markets watching, and geopolitical lines being redrawn, this might just be the biggest small deal of the year.
Also Read Trade War Truce? Not So Fast – China Keeps Choking Key Mineral Exports
