A trade deal between India and the United States would be strategically significant and send a strong message to global markets, according to Harsh Vardhan Shringla, Former Foreign Secretary.In an interview with CNBC-TV18, Shringla said that the first phase of the India-US trade agreement is likely complete and ready to move forward. “I’m told that all discussions have been completed. The entire issue now lies with Washington, mainly the White House, which has to take a final call,” he said.
Shringla noted that India took the initiative early on to engage the Trump administration. Prime Minister Narendra Modi visited Washington just 25 days after Trump assumed office, and both sides had agreed to double bilateral trade to $500 billion and work towards a mutually beneficial trade pact. “We’ve been working on this deal since Trump 1.0,” Shringla said, adding that the US remains the only major partner with whom India has not yet signed a trade agreement.
Explaining the broader tariff strategy being pursued by the US, Shringla said the Trump administration is using tariffs to protect domestic manufacturing and generate revenue. “By charging a base rate of at least 10%, and in some cases even higher duties—like with China—the US not only earns more revenue, but it also raises the bar for accessing the US market.”He added that Trump’s tariff approach stems from a desire to address the US’s unsustainable trade deficit—nearly a trillion dollars overall, with $450 billion of it with China. Trump is also rejecting the WTO’s differentiation between developed and developing nations, instead seeking to impose equal tariff rates on all trade partners. “He wants an equitable trading arrangement with major partners and countries across the globe,” Shringla explained.
Shringla noted that India took the initiative early on to engage the Trump administration. Prime Minister Narendra Modi visited Washington just 25 days after Trump assumed office, and both sides had agreed to double bilateral trade to $500 billion and work towards a mutually beneficial trade pact. “We’ve been working on this deal since Trump 1.0,” Shringla said, adding that the US remains the only major partner with whom India has not yet signed a trade agreement.
Explaining the broader tariff strategy being pursued by the US, Shringla said the Trump administration is using tariffs to protect domestic manufacturing and generate revenue. “By charging a base rate of at least 10%, and in some cases even higher duties—like with China—the US not only earns more revenue, but it also raises the bar for accessing the US market.”He added that Trump’s tariff approach stems from a desire to address the US’s unsustainable trade deficit—nearly a trillion dollars overall, with $450 billion of it with China. Trump is also rejecting the WTO’s differentiation between developed and developing nations, instead seeking to impose equal tariff rates on all trade partners. “He wants an equitable trading arrangement with major partners and countries across the globe,” Shringla explained.
On Trump’s decision to delay the July 9 deadline for imposing new tariffs, Shringla said it indicates that many of the ongoing negotiations have not yet concluded. “The timeline seems to have been unrealistic,” he said. “What the deadline extension indicates, in my view, is that he wants more time to negotiate satisfactory deals with a large number of countries.”
US President Donald Trump recently said that his administration is close to signing a trade deal with India. Sources tell CNBC-TV18 that India has offered substantial market access to US products in most sectors, barring agriculture and dairy.
Watch the accompanying video for the entire conversation.
