India, US trade dialogue moves forward after Trump softens stance

Talks between Indian and US officials in New Delhi were described as positive and forward-looking, with both sides pledging to push for an early conclusion of a trade agreement

Trade discussions between the US and India on Tuesday were described as “positive” and “forward-looking”, after US President Donald Trump adopted a more conciliatory tone following the additional 25 per cent tariffs on India over its purchase of Russian oil.

 

A US delegation led by Brendan Lynch, Assistant US Trade Representative for South and Central Asia, met Indian trade officials headed by Chief Negotiator Rajesh Agrawal in New Delhi on Tuesday, days after Trump announced that negotiations between the two countries would resume soon to address “trade barriers”.

 

The Commerce Ministry said, “It was decided to intensify efforts to achieve early conclusion of a mutually beneficial Trade Agreement.” Talks covered bilateral trade ties, including a possible India-US trade deal, Reuters reported.

 

While the two sides are now expected to hold a formal sixth round of negotiations, it was not immediately clear whether New Delhi would meet the Trump administration’s demand to cut its purchase of Russian oil or open its dairy and agriculture sector for US companies, the main sticking points in trade talks so far.

 

Former diplomat Mahesh Sachdev told ANI, “Today, in New Delhi, one-day talks between the US Assistant Trade Representative and the Indian Ministry of Commerce and Industry’s Special Secretary concluded. Both sides described the discussions as positive and forward-looking, aiming for a future trade agreement.”

 

He added that, although the specific details of the talks were not disclosed, differences in dairy, agriculture, fisheries, and India’s demand for equal treatment of IT were outlined.

 

“President Trump has emphasised India’s importance as a trade and strategic partner... Prime Minister’s recent China visit was a calculated move and relations with China and Russia reflect its strategic autonomy and multipolar approach, showcasing its sovereign decision-making and diverse international partnerships,” the former diplomat said.

 

Trump wishes PM Modi on his birthday

 

Earlier on Tuesday, in a phone call with Prime Minister Narendra Modi, Trump wished him on his 75th birthday. The call was the first publicly known conversation between the two leaders in three months, signalling a possible thaw in ties. Taking to Truth Social, Trump wrote, “Just had a wonderful phone call with my friend, Prime Minister Narendra Modi. I wished him a very Happy Birthday! He is doing a tremendous job. Narendra: Thank you for your support on ending the War between Russia and Ukraine.”

 

Responding on X, PM Modi wrote, “Thank you, my friend, President Trump, for your phone call and warm greetings on my 75th birthday. Like you, I am also fully committed to taking the India-US Comprehensive and Global Partnership to new heights. We support your initiatives towards a peaceful resolution of the Ukraine conflict.”

 

Trump softens stance on India

 

Last week, Trump softened his stance on India when he announced on Truth Social that negotiations between the two sides would resume soon to address trade barriers. He added that he was looking forward to a call with Modi. This followed a period of strained ties, with many Democrats fearing that two decades of efforts to strengthen relations with India and counter China would be undermined.

 

The bilateral relationship was impacted after Trump imposed 25 per cent “reciprocal tariffs” on India, compared with the originally decided 26 per cent in April, at a time when Washington secured trade deals with several countries, including China. Soon after, Trump imposed an additional 25 per cent tariff on India for purchasing Russian crude oil, even as Washington sought to broker a peace deal between Russia and Ukraine. The Trump administration, however, excluded China—the largest buyer of Russian oil—from the additional tariffs.

 

India-US trade

 

According to data from the Commerce Ministry, India’s exports to the US fell to $6.86 billion in August from $8.01 billion in July. In June, merchandise exports to the US had risen 23 per cent to $8.3 billion. In the first quarter of FY26 (April–June), exports to the US rose 22.18 per cent to $25.51 billion, while imports rose 11.68 per cent to $12.86 billion.

 

In March, India’s exports to the US reached a record $11.2 billion, during the 90-day tariff pause. The surge represented an approximate 50 per cent increase from India’s recent monthly average of $7.5 billion, marking the first time exports crossed the $10 billion threshold.