Donald Trump says India deal soon, flags Brics again

Hindustan Times

4 hours ago

The US and India are close to reaching a trade deal, President Donald Trump said on Monday, as his administration held off on including India among 14 countries that were sent ultimatum letters, threatening new tariffs from August 1. Marco Rubio, US secretary of state, left, and US President Donald Trump during a cabinet meeting at the White House in Washington. (Bloomberg)
Officials in New Delhi have said that they are waiting on word from Washington, after trade talks concluded last week with some sticking points appearing to remain unresolved.
'We've made a deal with the United Kingdom, we've made a deal with China, we're close to making a deal with India,' Trump told reporters during a meeting with Israel's Prime Minister Benjamin Netanyahu.
Speaking on Tuesday morning, Trump appeared to temper some of the optimism by a separate threat when he said India would face a 10% tariff as a member of the BRICS economic bloc, which he accused of trying to undermine the US dollar.
'They [India] will certainly have to pay 10% if they are in BRICS because BRICS was set up to hurt us, to degenerate our dollar,' Trump told reporters when asked if India would be subject to his announced BRICS tariffs. 'The Dollar is king. We are going to keep it that way. If people want to challenge it, they can. But they will have to pay a big price. I don't think any of them are going to pay that price.'
On Monday, the Trump administration unveiled tariff rates for 14 countries - including 25% levies on major allies Japan and South Korea - but notably excluded India from the list despite months of stalled negotiations over sensitive issues including agriculture and automobiles.
Of the 14 countries that received ultimatum letters Monday, most are smaller economies facing tariffs ranging from 25% to 40%, with the highest rates targeting Bangladesh (35%), Cambodia (36%), Laos (40%), and Myanmar (40%).
India's negotiating team, led by Special Secretary Rajesh Agrawal, returned from Washington last week after intensive discussions with the Office of the US Trade Representative failed to fully resolve key disputes that have persisted since talks began in March.
India has consistently refused demands for unfettered access for American agricultural goods, which officials, speaking to HT last week, described as 'a highly sensitive area for New Delhi as it involves the livelihood of millions of subsistence farmers.'
The country remains unwilling to allow imports of genetically modified crops like soybean and corn, since GM products are banned domestically. India has also resisted opening its dairy sector, citing both the subsistence-level nature of farming - where millions depend on just one or two cows or buffaloes - and religious sensitivities around US cattle feed containing non-vegetarian products.
Despite these sticking points, experts believe the exclusion from Monday's ultimatum letters signals progress in negotiations.
'I think they basically sewed up what is likely to be an agreement in principle but not a legally binding agreement in which the two sides issue a statement highlighting what has been agreed so far,' said Mark Linscott, senior advisor at the Asia Group and former Assistant US Trade Representative for South and Central Asian Affairs.
Linscott, who was involved in US-India trade talks during the first Trump administration, predicted any deal would be 'substantial' and 'go further than the other two agreements that have been announced so far with the UK and Vietnam,' including benefits on tariffs, market access, and non-tariff barriers.
Last week's negotiations followed frenzied developments on the trade front as the July 9 deadline neared. On July 3, India put the US on 30-day notice at the World Trade Organization before potentially suspending concessions on American imports, following its May challenge over US steel and aluminium tariffs.
India argues these tariffs affect $7.6 billion in Indian exports and generate $1.91 billion in duty collections for the US.
Commerce minister Piyush Goyal emphasised last week that India 'never negotiates trade deals with a deadline' and that any agreement would be announced only when 'fully finalised, properly concluded and in the national interest.' Speaking last week, Goyal stressed that 'national interest should always be supreme' and India would only pursue deals where 'both sides are benefitted.'
Trump extended his original July 9 deadline to August 1. The delay pertains to his April 2 'Liberation Day' tariffs, which imposed a 10% baseline levy globally plus higher country-specific rates that were suspended for 90 days.
India had initially faced a combined 26% tariff - the 10% baseline plus an additional 16% reciprocal levy - but officials have been hopeful of some concessions since both nations have been engaged in conversations from before.
Bilateral talks were announced in February when Prime Minister Narendra Modi visited Washington, with both leaders agreeing to negotiate the first tranche of a bilateral trade agreement by September and double bilateral trade to $500 billion by 2030.