Trump hints at imminent US–India trade deal amid tariff cut reports
Trump says the long-awaited US–India trade deal is near, hinting at tariff cuts and easing tensions over Russian oil imports
US President Donald Trump has said that the US and India will sign the much-awaited trade deal. President Trump’s remarks made in South Korea, on the last leg of his Asia tour, indicated that the trade deal between Washington and New Delhi may be executed soon.
"If you look at India and Pakistan, so I'm doing a trade deal with India and have great respect and love for Prime Minister Narendra Modi… we have a great relationship," said Trump as quoted by NDTV.
Tariffs and Russian oil import
Trump’s remarks come amid reports claiming that the US had agreed to bring down the tariffs on Indian goods from 50 per cent to 16 per cent. This came following a phone call between Trump and Prime Minister Narendra Modi, although no details were offered from either side, nor did they officially confirm the development regarding tariffs and Russian oil imports.
According to an NDTV report, the US has been urging India to allow corn imports, asserting that ethanol derived from American corn would solely be used for blending with petrol and would not affect domestic agricultural markets.
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The report further states that the pressure regarding soybeans stems from the US-China tariff row, which has rendered American soybeans too costly for Chinese buyers.
This has resulted in Washington seeking to offload its surplus soybean stock to India as a protein-rich feed for the world’s largest cattle population.
India’s stand trade deal with US
However, India has made it clear that no agreement will be accepted if it threatens the livelihood of millions of small farmers.
Also Read: Trump reiterates claim that India will stop buying Russian oil by year-end
Earlier this month, External Affairs Minister S. Jaishankar reaffirmed that any potential deal with the US must respect India’s “red lines,” particularly in light of what he termed the “unfair” 25 per cent penalty imposed on India for purchasing Russian oil.
The backdrop
The long-delayed Indo-US trade deal has suffered several hiccups, especially the friction between the two countries over Trump’s decision to impose a cumulative 50 per cent tariff on Indian goods.
Out of the 50 per cent tariff, 25 per cent is a reciprocal tariff for addressing the trade imbalance between the US and India, and the remaining 25 per cent is a penalty imposed by the Trump administration on India over its continued purchase of Russian oil.
Also Read: India, US near trade deal; tariffs on Indian goods may fall to 15-16 pc: Report
Washington has alleged that the revenue from New Delhi’s purchase of Russian oil was being used by Moscow for funding its war in Ukraine.
The Indo-US trade talks also got stalled due to India’s refusal to allow US access to its price-sensitive dairy and agriculture market.