In the run up to U.S. Trade Representative (USTR) Jamieson Greer’s visit to meet officials in the Commerce Ministry, including Commerce Minister Piyush Goyal, on June 23-24, two separate sources in the government have told The Hindu that an interim deal on trade only requires “final touches” and that the U.S. is keen to see a deal in place.

However, while the provisions of the deal are nearing completion, Mr. Goyal has indicated that the deal’s implementation would still require the U.S. to first finalise various tariffs.

Also Read | India, U.S. may execute first phase of bilateral trade pact by middle of next month: Goyal

“The USTR Jamieson Greer is scheduled to visit India on June 23 and 24,” a senior official in the Ministry of Commerce has confirmed, adding that Mr. Greer would meet Mr. Goyal and that the discussions would be centred around “giving final touches to the framework deal”.

This comes soon after a visit by Assistant USTR Brendan Lynch to New Delhi on June 1-4.

Mr. Goyal on Saturday (June 20, 2026) indicated that recent investigations and fresh tariff announcements were a major reason for the delay in finalising the deal with the U.S.

“We cannot implement the FTA [free trade agreement] until we secure a competitive advantage,” Mr. Goyal told reporters. “The issue currently pending is that our duties need to be lower compared to those of competing nations; once this is settled, the trade agreement will be implemented.”

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Stop and start

The two countries in February issued a joint statement saying they had agreed on a framework for an interim deal on trade that was expected to be signed over the next few months. Under the framework, the U.S. was supposed to impose an 18% tariff on imports from India, placing it at an advantage compared to most of its competitors.

However, later that month, the U.S. Supreme Court invalidated the reciprocal tariffs imposed by President Donald Trump, which slowed down the finalisation process of the trade deal.

“The negotiations have reached an advanced stage,” a second source in the government, closely associated with India’s trade deals, confirmed to The Hindu. “Several issues and details have been settled. The U.S. seems serious about finalising an agreement.”

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‘India’s advantage, amidst tariffs’

Further, the office of the USTR had, in March this year, launched an investigation under Section 301 of the U.S. Trade Act of 1974 to look into whether its trade partners, including India, were taking enough steps to stop the import of goods that are made using forced labour.

As part of this investigation, the USTR in June had proposed a 12.5% tariff on 54 countries, including India, that it said had “failed to impose and effectively enforce” prohibitions on the import of goods produced using forced labour. The final hearing under the case will take place on July 7.

“The Section 301 investigation is legal and is following due process,” the Commerce Ministry official said. “India has made its submissions to the U.S. The trade deal covers the entire gamut of trade relations and whenever a deal is signed we will have clear answers on Section 301 investigations.”

The second official, too, said that they expect U.S. tariffs to remain “in one form or another” as they are part of a politically and strategically sensitive issue of bringing manufacturing and strategic sectors back to the U.S. However, they added that the trade deal would still provide India an advantage over its competitors.

“The government believes that the U.S. will continue to offer preferential treatment to countries with which it has a trade agreement over those with which it does not,” the official said. 

The Trump administration has told the U.S. Supreme Court that it imposed tariffs against India for purchasing Russian energy products “to deal with a preexisting national emergency regarding Russia’s war in Ukraine” and as a “crucial aspect” of the President’s push for peace in the country.

Mr. Trump has imposed 25% reciprocal tariffs on India and an additional 25% levies for Delhi’s purchases of Russian oil, bringing the total duties imposed on India to 50%, with effect from August 27.

In a 251-page appeal to the Supreme Court, submitted on Wednesday (September 3, 2025), the Trump administration said that “the President recently authorised IEEPA (International Emergency Economic Powers Act) tariffs against India for purchasing Russian energy products, to deal with a preexisting national emergency regarding Russia’s war in Ukraine, as a crucial aspect of his push for peace in that war-torn country.”

The appeal further states that the “stakes in this case could not be higher. The President and his Cabinet officials have determined that the tariffs are promoting peace and unprecedented economic prosperity, and that the denial of tariff authority would expose our nation to trade retaliation without effective defences and thrust America back to the brink of economic catastrophe.”

It said that due to IEEPA tariffs, six major trading partners and the 27-nation European Union have already entered into framework deals with the United States, accepting tariff arrangements heavily recalibrated in America’s favour and agreeing to make approximately $2 trillion of purchases and investment in the U.S.’ economy.

Last week, the U.S. Court of Appeals for the Federal Circuit in Washington, in a 7-to-4 ruling, said the sweeping tariffs imposed by Mr. Trump on countries around the world are illegal, but also gave the administration time till October 14 to file a petition for a writ of certiorari in the Supreme Court, which the Trump administration did on Wednesday (September 4, 2025).

The appeal states that according to Treasury Secretary Scott Bessent, the tariffs “have been one of the country’s top foreign policy priorities for the last several months” and removing them “would lead to dangerous diplomatic embarrassment, expose the U.S. to the risk of retaliation”, and “interrupt ongoing negotiations mid-stream, undermining our ability to protect the national security and economic welfare of the American people.”

Pointing to the “fractured, 7-4 decision” of the appeals court declaring the President’s use of IEEPA tariffs as unlawful, the Trump administration told the court that “That decision casts a pall of uncertainty upon ongoing foreign negotiations that the President has been pursuing through tariffs over the past five months, jeopardising both already-negotiated framework deals and ongoing negotiations.”

Several of the Trump administration’s officials, including Mr. Bessent and trade advisor Peter Navarro, have said that India’s purchases of Russian oil are financing the Russian war effort in Ukraine.

On Wednesday (September 4, 2025), Mr. Trump said he put secondary sanctions on India for its purchases of Russian oil, “the largest purchaser outside of China”, and indicated that he hasn’t done “phase two yet or phase three” yet.

India has called the tariffs imposed by the U.S. “unjustified and unreasonable”.

New Delhi said that, like any major economy, it will take all necessary measures to safeguard its national interests and economic security.

White House trade adviser Peter Navarro said India’s purchases of Russian crude were funding Moscow’s war in Ukraine and had to stop, adding that New Delhi was “now cozying up to both Russia and China.”

“If India wants to be treated as a strategic partner of the U.S., it needs to start acting like one,” Mr. Navarro wrote in an opinion piece published in the Financial Times.

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The Ministry of External Affairs has previously said India is being unfairly singled out for buying Russian oil while the United States and European Union continue to purchase goods from Russia. U.S. President Donald Trump levied an additional 25% tariff on Indian goods earlier this month, citing New Delhi’s continued purchases of Russian oil, taking total tariffs on imports from India to 50%.

“India acts as a global clearinghouse for Russian oil, converting embargoed crude into high-value exports while giving Moscow the dollars it needs,” Mr. Navarro said.

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The adviser also said it was risky to transfer cutting-edge U.S. military capabilities to India as New Delhi was “now cozying up to both Russia and China.”

Prime Minister Narendra Modi is set to meet Chinese President Xi Jinping at the end of the month while Chinese Foreign Minister Wang Yi is visiting India from Monday (August 18, 2025) for talks on the disputed border between the two countries.

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A planned visit by U.S. trade negotiators to New Delhi from August 25-29 has been called off, a source said over the weekend, delaying talks on a proposed trade agreement and dashing hopes of relief from additional U.S. tariffs on Indian goods from August 27.

India has been a “bit recalcitrant” on trade negotiations with the US, Treasury Secretary Scott Bessent has said.

“That’s aspirational,” Mr. Bessent said on Fox Business on Tuesday (August 12, 2025), responding to a question on wrapping up all the tariffs and trade deals by the end of October.

“But I think we are in a good position. The big trade deals that aren’t done or aren’t agreed – Switzerland is still around, India has been a bit recalcitrant,” he said, adding that U.S. Trade Representative Jamieson Greer and teams of lawyers “are busy papering all this over”.

“So I think we will have agreed on substantial terms with all the substantial countries. And as I’ve been saying for a long time, the President’s (Donald Trump) doing peace deals, trade deals, tax deals,” he added.

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Even as trade negotiations between India and the U.S. were ongoing, Mr. Trump imposed tariffs totalling 50% on India, including 25% for Delhi’s purchases of Russian oil, which will come into effect from August 27.

Responding to the tariffs, the Ministry of External Affairs in New Delhi has said that the targeting of India is “unjustified and unreasonable”.

“Like any major economy, India will take all necessary measures to safeguard its national interests and economic security,” it said.

Last week’s announcement of Mr. Trump’s executive order imposing the additional 25% tariffs on India came at a time when a team from the U.S. is scheduled to visit India from August 25 for the sixth round of negotiations for the proposed bilateral trade agreement.

The two countries are aiming to conclude the first phase of the pact by fall (October-November) this year.

U.S. President Donald Trump on Wednesday (August 6, 2025) signed an executive order imposing an additional 25% tariff on imports from India, in response to India “directly or indirectly” importing oil from Russia. This is over and above the 25% tariff on Indian imports that Mr. Trump approved on July 31.

While the initial 25% tariff will come into effect from Thursday (August 7, 2025), the additional 25% tariff will come into effect after 21 days.

The Ministry of External Affairs (MEA) responded to these latest developments, saying it has made its stand clear — through an earlier statement following Mr. Trump’s threat of additional tariffs — that these actions were “unfair, unjustified and unreasonable”. It was “extremely unfortunate” that the U.S. has chosen this course of action, the MEA said.

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‘Penalty’ for Russian oil imports

“To deal with the national emergency described in Executive Order 14066 [relating to Russia’s actions in Ukraine], I determine that it is necessary and appropriate to impose an additional ad valorem duty on imports of articles of India, which is directly or indirectly importing Russian Federation oil,” Mr. Trump’s executive order said. 

“Accordingly, and as consistent with applicable law, articles of India imported into the customs territory of the United States shall be subject to an additional ad valorem rate of duty of 25%,” it added.

Over the last few days, Mr. Trump has repeatedly threatened additional tariffs on India as a “penalty” for its oil imports from Russia.

Also Read | I never said a percentage: Trump on increasing tariffs on countries buying Russian energy

‘Unfair, unjustified, unreasonable’

In response to one such threat, the MEA on August 4 pointed out that, not only did the U.S. encourage such trade previously, both the European Union and the U.S. actively trade other items with Russia in excess of the amount that India pays for Russian oil.

“We have already made clear our position on these issues, including the fact that our imports are based on market factors and done with the overall objective of ensuring the energy security of 1.4 billion people of India,” the MEA statement said. “It is therefore extremely unfortunate that the U.S. should choose to impose additional tariffs on India for actions that several other countries are also taking in their own national interest.”

“We reiterate that these actions are unfair, unjustified and unreasonable,” the MEA added. “India will take all actions necessary to protect its national interests.”

‘Competitive disadvantage’

This latest escalation by Mr. Trump is a “severe setback” for Indian exports, said S.C. Ralhan, president of the Federation of Indian Export Organisations, noting that nearly 55% of Indian exports to the U.S. market will be directly affected. 

“The 50% reciprocal tariff effectively imposes a cost burden, placing our exporters at a 30% to 35% competitive disadvantage compared to peers from countries with a lower reciprocal tariff,” Mr. Ralhan added.

Negotiators from the U.S. and India are currently engaged in finalising the first tranche of a Bilateral Trade Agreement (BTA) by fall of this year. The next physical meeting between the two sides is expected to start on August 25 in New Delhi. 

‘Talks hampered by threats’

“India should remain calm, avoid retaliation for at least six months, and recognise that meaningful trade negotiations with the U.S. cannot proceed under threats or mistrust,” said Ajay Srivastava, founder of the Global Trade Research Initiative and a former Director General of Foreign Trade.

He added that India could consider stopping its purchases of Russian oil only if it was economically viable, and not under duress from Washington.