India and the United States have agreed to extend their timeline to finalise a bilateral trade agreement, pushing the original 9 July deadline to the end of the month, a report by The Mint said on Wednesday. The extension comes as President Donald Trump, while rolling out tariff announcements for select countries, confirmed that retaliatory duties will come into effect starting August 1st.
While 14 countries have already received formal notifications from the U.S. President outlining revised tariff structures following a 90-day pause, India is notably absent from that list and is not expected to receive such a letter, the people cited said on condition of anonymity.
The terms of the potential agreement with India—cleared by the U.S. Trade Representative (USTR)—are currently pending final approval from President Trump. Meanwhile, Indian negotiators are proceeding with caution, determined not to rush into a deal resembling the recently concluded pact between the U.S. and Vietnam, the report added.
“We are aiming for a fair and dignified agreement by holding firm on our red lines, especially concerning agriculture and dairy,” one of the individuals said.
The unresolved issues in the talks include critical sectors such as agriculture, dairy, genetically modified (GM) seeds, digital trade, and medical services. While Washington is pressing for greater market access, New Delhi is keen to safeguard its domestic interests.
“We’re close to making a deal with India,” President Trump remarked in Washington on Monday.
Steep Tariff Announcements
According to an executive order signed by Trump on Monday, the U.S. will implement new reciprocal tariffs from 1 August for a list of countries: Japan (25%), South Korea (25%), South Africa (30%), Kazakhstan (25%), Laos (40%), Malaysia (25%), Myanmar (40%), Tunisia (25%), Bosnia and Herzegovina (30%), Indonesia (32%), Bangladesh (35%), Serbia (35%), Cambodia (36%), and Thailand (36%).
The sharpest duties—40%—will apply to Laos and Myanmar. Thailand’s tariff remains at 36%, unchanged from the April 2 announcement. Cambodia’s duty has been lowered from 49%, Bangladesh’s from 37%, while Indonesia’s 32% remains constant. Malaysia’s rate has been raised slightly to 25%. Japan and South Korea are also set to face 25% tariffs.
“Updated tariff letters for additional countries will be released in the coming days and weeks,” White House Press Secretary Karoline Leavitt said on Monday.
Until the trade agreement with India is finalized, the current tariff structure will stay at 26%—made up of a 10% base duty and an additional 16%, according to the second source. “We are optimistic that the deal can be concluded by next week, or at the latest, before 31 July,” the person said.
“We want a deal—not a steal,” the individual added, referring to Vietnam’s agreement with the U.S., which still includes a 20% tariff despite a longstanding free trade pact between the two nations.
Experts Warn of Imbalanced Deals
Trade analysts caution that the emerging agreement with India may reflect more pressure than genuine give-and-take, as President Trump pushes for concessions without offering corresponding benefits.
“These are not reciprocal deals—they are deals under duress,” said Ajay Srivastava, co-founder of the Global Trade Research Initiative (GTRI).
“Trump’s trade strategy sidesteps traditional free trade agreements. It involves demanding tariff cuts and purchase commitments from partner countries, without the U.S. offering similar concessions, essentially making the process one-sided,” he explained.
Srivastava added that even finalized deals offer limited certainty: “The recent 10% tariff threat against BRICS nations over so-called anti-American policies illustrates just how volatile and politically driven U.S. trade policy has become.”
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
