For Trump, tariffs are like toys— can India really trust him?

The fact that India has not signed the bilateral trade agreement with the United States by the Trump-imposed deadline of 9 July is being hailed both as good news and bad.

The good news is that India has apparently not agreed to everything that Trump wanted us to concede.

The bad news is that the longer the negotiations continue, the greater the chances of the POTUS demanding more than the legitimate pound of flesh — if any such is owed at all.

India has been ‘lucky’, we are told, as Trump has not yet sent his typically rude and condescending letter yet, nor singled India out for special mention. Who can tell, however, how long this benevolence might last?

Prime Minister Modi may have realised by now the risks of breaking bread with the unstable and erratic US president. Too much time, however, has already been lost in striking a ‘respectable’ deal with the US.

Conversely, too little time has been devoted by India, it would seem, to preparing a Plan B, in developing alternative markets and moving to engage with the more difficult partners of China, Russia and the Global South. Piyush Goyal’s haughty dismissal of the ASEAN countries as the ‘B’ team of China even as New Delhi — which is hopelessly dependent on imports from China — signals its reluctance to promote trade ties with our northern neighbour may extract a steep price if Trump does not relent.

Trump doubles down on 10% tariff for BRICS; threatens 200% on pharma

The India–US farm trade remains modest at USD 8 billion, with India exporting rice, shrimp and spices, while the US sells nuts, apples and lentils to India. But as trade talks progress, Washington is eyeing bigger farm exports — maize, soyabean, cotton and corn — to help narrow its USD 45 billion trade deficit with India. No tariff cuts are expected for dairy products or key food grains such as rice and wheat, categories that are both politically and economically sensitive.

Curiously, a recent Niti Aayog paper, which has been discreetly withdrawn after it caused a public furore, actually recommended tariff cuts on imports from the US — including rice, dairy, poultry, corn, apples, almonds and GMO soyabean.

The NITI Aayog paper called for allowing duty free import of genetically modified maize and soyabean from the US. For the Modi sarkar, the interests of Midwestern American farmers and large Multinational Corporation traders are bigger than that of the maize farmers of Bihar and… https://t.co/wvetw6fysS

— Jairam Ramesh (@Jairam_Ramesh) June 30, 2025

By all indications India has been pressing for a ‘limited trade deal’ with the US in order to escape the punitive Trump tariffs that would be disastrous for Indian exporters. India is understood to have offered to open up its market to specific goods exported by the US, those targeted at the premier segments, and to substantially reduce tariffs on select goods such as automobiles and bikes up to or beyond a certain specification. While India cannot afford to open up its market to basic agricultural produce and dairy products — or to genetically modified (GM) foods and seeds, for that matter — it has expressed its readiness to allow restricted access to high-end products such as wine and cheese.

Even as the White House and India’s finance minister Nirmala Sitharaman have been hinting at an imminent deal, there are disquieting signals that all is not well. While Ms Sitharaman had been upbeat in asserting that New Delhi would welcome a “big, good and beautiful” trade agreement, negotiations have been prolonged and Indian negotiators are reported to be returning to Washington DC this week. That does not send out a comforting message.

Indian negotiators would undoubtedly be aware of Japan’s trade negotiator having visited Washington DC at least seven times since April, when Trump announced his sweeping tariffs. Yet those trips seem to have borne little fruit. Trump's label for Tokyo moved from "tough" to "spoiled" as talks dragged on. On one occasion, according to reports in the US media, the negotiator was present in the White House but was not given time to meet anyone of any consequence. If this is how closer allies are being treated by Trump’s team, what chances do the Indian negotiators have?

Another tricky aspect is the secrecy which the Indian government — unwisely, according to at least some trade experts — maintains about its international agreements in general. Neither the full details of India’s trade agreement with the UAE in 2022, nor of those with the UK earlier this year are available in the public domain. Experts believe that India has agreed to allow the UAE to bid for procurements by the Indian government. A similar concession, they say, has been granted to the UK, provided that the British components in the product make up at least 20 per cent.

Well and good — but we just don't know for certain.

Meanwhile, in contrast, neither the US nor the UK, the experts note, allow foreign governments and manufacturers to bid for more than 3–4 per cent of their government’s procurement. What if the British components constitute 20 per cent, but the rest is made up of parts from China, asks one of the experts, a former Indian negotiator at the WTO (World Trade Organization)?

Nor has the Indian government or the prime minister spoken up clearly and strongly to reassure the people that India’s interests shall be taken care of. With Trump threatening to impose an additional 10 per cent tariff on BRICS member countries, the Brazilian president has called for BRICS countries to impose reciprocal tariff on the US. India has been quiet, however, for far longer than is desirable.

Brazil President Lula: "Trump could've called, but instead posted the tariff news on his website - a complete lack of respect which is typical of his behavior towards everyone." pic.twitter.com/R2kCiiPfUR

— COMBATE |🇵🇷 (@upholdreality) July 11, 2025

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A reasonable and pragmatic US administration would have appreciated India’s compulsions and obligations and given out enough concessions to make a deal attractive.

However, nobody is even asking what the US is willing to offer India in return this time.

Will the US allow its market for textiles and leather goods to open up to Indian exports? Will it give concessions to Indian two-wheelers, automobiles, apples, mangoes and cashew?

Instead, we have President Trump’s endless threats, including a possible 200 per cent tariff on pharma products.

So, can India afford to trust Trump on trade? For how long?

Views are personal