【By Zhang Jingjuan, Observers.net】Just three weeks after the Trump administration imposed a 50% tariff on India, the India-US trade talks resumed in New Delhi on September 16. On the same day, the Indian Prime Minister also had a phone call with US President Trump. And this day happened to be Modi's birthday.
The "positive and constructive" meeting, along with the first public call in three months, not only broke the stalemate that had lasted for several months, but also sparked widespread speculation about a possible turning point in bilateral relations.
Subsequently, The Times of India reported on the 20th that a high-level delegation led by India's Minister of Commerce and Industry, Piyush Goyal, will visit the United States on September 22, 2025, aiming to advance ongoing trade negotiations and strive for an early mutually beneficial agreement.
The United States is India's largest trading partner, and high tariffs seem to have already impacted the bilateral trade relationship. According to the latest data released by the Indian Department of Commerce, India's exports to the US fell from $8.01 billion in July to $6.86 billion in August. Indian exporters warned that the full impact of the US tariff policy on Indian commodity exports would become evident in September. In this context, India's core concerns in the negotiations gradually became clear.
Shiv Shankar Sinha, a member of the India Foundation and former Chief of the Integrated Defence Staff of India, and a retired Rear Admiral, stated clearly during an exclusive interview with Observers that most restrictive measures were taken by the US, so the US must take the first step back, while India must clearly tell the US what its red lines are.
Shiv Shankar Sinha, Observers.net
Sinha pointed out that India has four non-negotiable red lines:
First, agriculture. India cannot allow farmers to suffer due to opening up the agricultural market, "this is unacceptable."
The agricultural sector supports the livelihood of about 42% of India's population and is also a crucial political base for Modi's government. Expanding access for American agricultural products could impact the local agricultural ecosystem, which India cannot compromise on.
Second, fisheries. India is a major exporter of fish and shrimp, and must be protected.
Third, dairy products.
Sinha said that India has been self-sufficient in dairy products for many years. "If the US wants to sell dairy products here, they won't be able to sell them at all. Why create trouble for India's dairy industry?"
He emphasized that India's milk production is already high enough to export to neighboring countries. "Our cheese and butter also have their own characteristics, and they are cheaper than those from the US. We won't buy from them."
In addition, due to cultural and religious reasons, India has strict regulations on dairy product imports, requiring imported milk to be certified that the source cows have not consumed animal feed. India traditionally raises grass-fed cattle, and milk is considered sacred in the eyes of most Hindus in India.
Fourth, energy. India will continue to purchase oil from Russia unless the US can offer an alternative at the same price.
He also pointed out that it is wrong to say India is helping Russia fight, and criticized the Western double standards: the US can spend more money to buy oil, and the EU can do the same, while India doesn't have that much money (to buy expensive oil). He believes that the US and EU repeatedly mention India's import of Russian oil, "is hypocritical, and this hypocrisy must end."
Factually, India's energy imports from the US reached $6.6 billion in the first half of 2025, a 70% increase compared to the previous year, but this did not impress the Trump administration.
Although firm on core interests, India still reserves room for flexibility in negotiations. Sinha revealed that there may be limited adjustments in peripheral areas such as animal feed, since the straw from rice husks in India is very cheap, sometimes even discarded, making it difficult for US products to compete.
He believes that India might make some concessions in non-agricultural areas, while seeking broader cooperation in high-tech fields.
"If you (the US) want business, we will give you many businesses. Perhaps we can buy more technology. We have already collaborated in the 'India-US Initiative on Critical and Emerging Technology' (iCET). Technology needs financial support, so one could say, 'Okay, we will give you so many billions of dollars in orders,' perhaps not in the agricultural sector, but the total amount will be high," Sinha said.
But before that, "the US will continue to pressure, threatening to do this or that. But India does not accept any threats, nor will it yield. Especially the current prime minister, he will not allow anything that affects the people of India to happen."
Notably, on the day the talks resumed, Trump and Indian Prime Minister Modi had a phone call, offering birthday wishes. Modi also responded positively through social media. German media cited sources at the end of last month saying that Trump tried to contact Modi at least four times recently, but the latter refused to speak with him.
Regarding this shift, Sinha said that Modi is a very busy person, often traveling. Moreover, trade negotiations cannot be conducted over the phone. At that time, the situation was that there was nothing else to talk about besides trade.
Sinha said: "That day was his birthday, he answered the call, but generally, heads of state do not answer calls directly, but have others transfer the call. If he was busy at that time, he would say, 'Wait, I have two or three important things to do.' That's normal. Talking about 'he didn't answer my call' is like a child's behavior, and should not be done."
February 2025, Modi and Trump met at the White House. Visual China
Since Trump's re-election, the US has become increasingly aggressive towards India. Sanctions threats related to Russia, progress in US-Pakistan relations, and the imposition of high tariffs on India by the US have plunged Indo-US relations into a low. Meanwhile, several members of the Trump administration, including US Treasury Secretary Steven Mnuchin and Trump's trade and manufacturing advisor Peter Navarro, have made unfriendly remarks about India and even Modi.
However, since early September, the relationship between the two sides seems to have started to thaw. With Goyal's upcoming visit to the US, the bilateral trade negotiations may enter a critical phase. Sinha expects that people will soon see the results, which may be maintaining the 50% tariff, or reducing it to 35%.
However, just as India-US trade negotiations gained momentum, Trump suddenly targeted the service sectors that could harm India the most.
On the 19th, the Trump administration announced that it would require companies to pay $100,000 per H-1B work visa annually. Data shows that last year, India was the biggest beneficiary of H-1B visas, accounting for 71% of approved beneficiaries.
If implemented, this policy would directly affect India's IT services exports and may weaken India's competitiveness in the global tech supply chain, casting a shadow over the already improving bilateral economic and trade relations.
The Indian Ministry of External Affairs responded quickly on the 20th, hoping that the US would "properly resolve" the issue and stated that it is studying the full impact of the policy.
The Indian IT industry association, the National Association of Software and Services Companies (Nasscom), also pointed out on the same day that the abrupt implementation of this policy would affect Indian citizens and disrupt the continuity of onshore projects being carried out by Indian technology service companies in the US.
It now appears that India faces a more complex situation in trade negotiations: on one hand, it must hold its ground, and on the other, it must deal with new challenges in the service sector. Finding a balance between upholding core interests and alleviating external pressures may become a significant test for the Indian government in the coming days.
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