Staff Correspondent, Dhaka:
India has adopted a firmer negotiating stance in its ongoing trade talks with the United States, signaling that it is no longer willing to accept a limited agreement that fails to address its strategic economic interests. The latest round of negotiations ended without an interim deal, highlighting widening differences over tariffs, market access and agricultural protections.
New Delhi’s position reflects a significant shift in confidence. Rather than rushing to avoid potential US tariff hikes, India appears willing to endure short-term uncertainty in pursuit of a more favorable long-term agreement. Indian officials insist that any deal must provide a clear tariff advantage over competing exporters, particularly China, while also ensuring protection from future unilateral US tariff increases.
The evolving geopolitical and economic landscape has strengthened India’s bargaining position. Strong export growth, recovering trade with Gulf nations, and expanding market access through new agreements with the United Kingdom and the European Union have reduced India’s dependence on the US market. This diversification gives policymakers greater flexibility in resisting external pressure.
India’s domestic economic outlook has also improved. Easing oil prices following reduced tensions in the Middle East, a stronger growth forecast, lower inflation expectations and a more competitive rupee have collectively enhanced the country’s resilience. These factors lessen the urgency to secure a quick agreement with Washington.
Politics is another important consideration. Prime Minister Narendra Modi’s government continues to priorities protecting farmers and small businesses—two influential electoral constituencies that have traditionally benefited from India’s cautious trade policies. Any concession on agriculture could carry significant domestic political costs, making compromise increasingly difficult.
From Washington’s perspective, India remains a strategically important partner in efforts to diversify supply chains away from China. However, the US expects reciprocal market-opening measures before granting preferential treatment. The possibility of additional tariffs under the Trump administration further complicates the negotiations, while legal challenges to proposed US trade measures create additional uncertainty.
The prolonged deadlock illustrates a broader transformation in India’s trade strategy. Rather than negotiating from a defensive position, New Delhi is leveraging its expanding global partnerships, stronger economic fundamentals and growing geopolitical importance to seek a more balanced agreement. Whether this approach ultimately secures better terms will depend on both countries’ willingness to reconcile strategic interests with domestic political priorities.
