India-US trade deal talks near conclusion as Piyush Goyal cautions against rushed agreements

Commerce and Industry Minister Piyush Goyal on 24 October emphasised that India will not rush into any trade agreements or succumb to pressure, stating: "India will not sign any trade deal in a hurry." Speaking at the Berlin Global Dialogue, Goyal added: "We are talking to the US, but we don't do deals in a hurry." He further asserted: "India doesn't do deals with deadlines or with a 'gun on our head'." 

This comes amid reports that India and the United States are "very near" to concluding a trade deal, potentially slashing US tariffs on Indian exports to 15%-16% from the current 50%, according to a Mint report citing unnamed sources. 

The statements follow US President Donald Trump's threat of 155% tariffs on Chinese imports, with experts like Robert Lighthizer warning of a "very different kind of trade war" that could impact global allies like India. Nomura analysts noted that lower US tariffs could help offset India's reliance on Russian oil imports, providing a buffer against potential sanctions. As negotiations intensify ahead of Trump's meeting with Xi Jinping, Goyal's remarks signal India's firm stance on equitable terms.

Goyal's firm stance on trade negotiations

During his speech at the Berlin Global Dialogue, Goyal reiterated India's cautious approach to trade pacts, particularly with the US and EU. He said: "We don't do deals in a hurry, and we don't do deals with deadlines, with a gun on our head." Addressing concerns over US tariff hikes that have impacted Indian exports, Goyal confirmed ongoing dialogues but stressed national interest: "India will not sign any trade deal in a hurry." 

“We are in active dialogue with the US, but we do not do deals in a hurry and we do not do deals with deadlines or with a gun to our head," Goyal said.

Goyal's comments come as India seeks to protect its interests amid Trump's aggressive trade policy, which has already imposed duties on Indian steel and aluminium. The minister's message was clear: "India does not do trade deals in hurry or with gun to our head: Goyal." This position aligns with India's strategy to diversify trade partners while negotiating bilaterals, as seen in recent pacts with Australia and the UAE.

Near conclusion of India-US trade deal

Despite the caution, a senior government official indicated progress, stating: "India, US 'very near' to a trade agreement." The Mint report revealed: "India nears deal to slash US tariffs on Indian imports to 15%-16%." Sources confirmed the pact focuses on energy and agriculture, with Washington potentially reducing tariffs from 50% to 15%-16%, benefiting Indian exports like textiles and pharmaceuticals. The agreement could add $10-15 billion to bilateral trade, currently at $190 billion, by easing market access.

The official added, "India-US trade deal soon? ‘Very near’ to concluding agreement." This development follows extensive talks, with Goyal confirming: "We are talking to the US, but we don't do deals in a hurry." The deal's tariff cuts are seen as a counter to Trump's broader protectionism, providing India leverage in negotiations.

Trump's tariff threats and US pressure

Trump's 155% tariff warning on China has ripple effects, with experts stating: "US-China now in a ‘very different kind of trade war’." Trump said: "China's paying 55% and a potential 155% come November 1st unless we make a deal." He added: "If they don’t do business with us … they’ll be in big trouble." Goyal's response directly addresses this, saying: "No deal with a gun to our head."

Curiously, the minister acknowledged that the India-US trade talks were “progressing in a very cordial atmosphere".

The US seeks concessions on India's Russian oil imports, with Nomura analysts noting: "Lower US Tariffs to Offset India’s Russia Oil Shift." India maintains its diversified energy strategy, with Goyal stating: "We'll not sign any deal in a hurry."

Expert views on trade war escalation

Lighthizer warned of heightened risks, stating: "US-China now in a ‘very different kind of trade war’, experts warn." The escalation could disrupt global supply chains, with India potentially benefiting from reduced tariffs but facing pressure on IP and services.

India has repeatedly described the Trump tariffs as “unfair, unjustified, and unreasonable".

The suggested agreement seeks to greatly enhance the bilateral trade volume, which is presently estimated at around $131.84 billion for the fiscal year 2024-25, aiming for a target of $500 billion by the year 2030. Although a source involved in the negotiations mentioned on Friday that the two parties are "very close" to finalising the agreement, Goyal’s remarks highlight India’s steadfast commitment to prioritising long-term advantages and national interests over any external deadlines or coercive strategies.

The nearing deal could slash tariffs, boosting exports, but Goyal's caution ensures no rushed concessions. As Trump meets Xi, India's position strengthens leverage, with experts like Nomura saying: "US tarrif reduction to India opens new prospect for commercial shipping." The outcome hinges on 1 November.