As the July 9 deadline for India-US trade negotiations approaches, former diplomats warn of the risks posed by rushing into an agreement amid the unpredictable and often volatile trade policies under President Donald Trump. While government officials remain optimistic about a “productive” week of talks, experts urge caution, emphasising that India must not compromise its core interests under pressure.The greatest concern centers on the erratic nature of the US administration’s trade stance, which could undermine a stable and beneficial deal.
Kanwal Sibal, former Foreign Secretary, said, “The United States, especially President Trump, with his extremely erratic behaviour and obsession with tariffs, has the upper hand.”
He added that “for Trump, the tariffs business is the centrepiece of his entire foreign policy—not geopolitics.” This erratic behaviour means any agreement reached might not be durable or could be unilaterally altered by the US at a later date.Both Sibal and Anjali Prasad, former Indian ambassador to the WTO, strongly cautioned against the “risk of a harmful interim deal.” Ambassador Prasad drew parallels to past experiences, stating, “If we look at the history of these so-called interim deals—let’s look at the early harvest of the India-Thailand FTA—what did it do to us? It completely damaged our fledgling electronics industry.”She emphasised that “no trade deal is worth its salt if it makes the country poorer in per capita terms than it already is.”A major sticking point in the negotiations remains “India’s red lines: agriculture and dairy.” The US is reportedly pushing for increased access to Indian markets for wheat, rice, maize, and dairy products. Both diplomats indicated that India is unlikely to concede on these highly sensitive sectors.The prevailing sentiment is that the “US is negotiating from a position of strength.” Ambassador Prasad was blunt, stating, “We are not equals in this negotiation, certainly, and as Ambassador Sibal said, the US has the upper hand and is being aggressive. Let’s be blunt: they are interested only in our market.” The US has long sought to categorise India as an “advanced developing country” to justify further demands.The July 9 deadline itself is seen as a form of “coercion and unrealistic deadlines.” Sibal described it as “a form of an ultimatum, frankly,” noting that failure to reach a deal would result in substantial tariffs being applied across the board to Indian goods. Ambassador Prasad echoed this, calling the deadline “not practical” for resolving complex issues like digital trade and technical barriers.Ultimately, the former diplomats underscored the importance of “prioritising national interest over a deal.” They advised India to stand firm and defend its policy space, particularly in sensitive sectors like agriculture and manufacturing, even if it means foregoing an interim deal and facing reciprocal tariffs. The long-term economic well-being of the nation should take precedence over a rushed agreement.Watch the video for more
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