India Index Founder and CEO Samir Kapadia discusses the benefits of President Donald Trump’s trade deal with India on ‘Mornings with Maria’.
Commerce Secretary Howard Lutnick, accompanied by US Ambassador to India Sergio Gor, met his Indian counterpart in New Delhi on Thursday. The meeting comes less than a week after the Supreme Court struck down President Donald Trump’s sweeping global tariffs.
Indian Trade and Industry Minister Piyush Goyal called the talks “very fruitful” and posted a photo of the three officials smiling together. The meeting marked renewed momentum, even as India was one of the first Asian countries to respond to the court ruling.
Just days earlier, New Delhi had postponed talks with Washington to finalize an agreement trading framework. Still, uncertainty remains as the deal hangs in the balance. In a press statement, India’s Ministry of Trade and Industry said: “We are studying all these developments for their implications.”
In the wake of the court ruling, the Trump administration imposed a temporary base rate of 10% as several countries began to reconsider their positions.
TRUMP rips Supreme Court tariff ruling in SOTU, promises new legal battle after 6-3 blow
Earlier this month, the US announced a trade framework that eased mutual tariffs, bringing relief to Indian markets. Under that arrangement, US tariffs on Indian goods would drop to 18%, higher than the current baseline of 10%. India had also agreed to purchase US$500 billion worth of US goods over five years.
The deal was expected to take effect in April. But now that the tariff landscape has changed, the South Asian giant could benefit, and experts say it may have gained more power.
“The new rate is lower than the negotiated rate, and the uniform levy ends the competitive advantage that concessions were supposed to provide,” Srivastava said. “There is little incentive to offer tariff cuts, investment promises or procurement commitments to Washington, especially when identical access to the US market is available even without a deal.”
TRUMP REDUCES SOME TARIFFS AFTER SUPREME COURT LOSS, BUT KEEP TRADE BATTLE ALIVE
Indian purchases of Russian oil have also remained a sticking point. In the original trade talks, President Trump said New Delhi had “committed to cease importing oil directly or indirectly from the Russian Federation,” although Indian officials made no public mention of such a commitment.
India, the third largest oil importer in the world and consumers are expected to see purchases of Russian crude fall to a two-year low this month. Still, in light of the court’s ruling, analysts say India will likely continue buying Russian oil.
President Donald Trump speaks to the press during his meeting with Indian Prime Minister Narendra Modi in the Oval Office of the White House in Washington, DC, February 13, 2025. (Jim Watson/AFP via Getty Images/Getty Images)
Despite everything, President Trump has remained defiant and insists his deals are safe. In one Truth Social Post After the Supreme Court’s decision, he said, “Any country that wants to ‘play games’ with the Supreme Court’s ridiculous ruling, especially those who have ‘defrauded’ the US for years and even decades, will face a much higher tariff, and worse, than what they recently agreed to. BUYER BEWARE!!!”
The White House still has several legal tools at its disposal to pursue its economic agenda, including alternative trade authorities and reopening new trade investigations.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
In the latest escalation with India, the government has imposed a 126% tariff on solar energy imports, signaling that the ‘America First’ policy remains a priority. The tariffs follow allegations that Indian companies have unfairly benefited from government subsidies and undercut American manufacturers. The country’s solar energy imports rose to nearly $793 million in 2024, a roughly ninefold increase from 2022, according to U.S. Census Bureau trade data.
According to the Office of the United States Trade Representative, total trade in goods and services between the US and India was approximately $212 billion in 2024, underscoring the extent of their economic relationship.
Merchandise trade alone accounted for about $129 billion, while the US had a $45.8 billion merchandise trade deficit with India, a gap that continues to shape tariff negotiations between the two countries.
