【By Chen Sijia, Observer News】India was one of the first countries to engage in trade negotiations with the United States, but the deadline for the US to raise tariffs is approaching, and the two sides have not yet reached an agreement. According to a report by India's Economic Times on July 5, Piyush Goyal, Minister of Commerce and Industry of India, stated that India will "negotiate from a position of strength" and will not hastily sign an agreement that does not serve national interests before the deadline.

Goyal said at a meeting: "We keep national interests in mind during negotiations, and national interests are crucial in all our global engagements. Since the Modi government came into power, we have signed free trade agreements with Mauritius, UAE, Australia, and the European Free Trade Association countries - Switzerland, Norway, Iceland, and Liechtenstein, as well as with the UK."

He emphasized that India's trade negotiations will not be constrained by deadlines. "Today, India will negotiate from a position of strength. We are confident that we can compete with any country in the world."

Piyush Goyal, Minister of Commerce and Industry of India, Visual China

Since the start of trade negotiations between the US and India, officials from both countries have consistently claimed that India could be among the "first countries to reach an agreement with the US," but the negotiations quickly hit a deadlock. July 9 is the deadline for the US to suspend the so-called "reciprocal tariffs" for 90 days. If India fails to reach a trade agreement with the US before the deadline, it will face a 26% tariff.

Bloomberg reported that in recent negotiations, the Indian government has taken a more cautious stance on issues such as agriculture. The US hopes to allow genetically modified crops into the Indian market, but India is unwilling to make a deal that could weaken the interests of its farmers. India proposed allowing the import of some genetically modified animal feed, but this was rejected by US officials.

Opposition groups and farmer associations in India are pressuring the Modi government, warning Prime Minister Modi not to make "excessive concessions" to the US. Avik Saha, a member of the farmer organization Samyukt Kisan Morcha, said that Indian farmers are already facing severe economic pressure, and allowing genetically modified crops from the US into the Indian market would further harm their interests.

Bloomberg pointed out that although genetically modified varieties can increase yields, the Indian government does not allow the cultivation of genetically modified crops. The Indian Supreme Court has blocked the commercial release of genetically modified mustard, and the Indian government also rejected a genetically modified eggplant in 2010.

Additionally, the US hopes that India will make concessions in the automotive sector, providing preferential treatment for US component manufacturers, but India believes this move would have adverse effects on its domestic industry.

Some informed officials told Bloomberg that India has already presented its negotiation bottom line to the US, including not allowing US exports of genetically modified crops to India, and not opening up India's dairy and automotive sectors to the US. According to informed sources, whether the two sides can reach an agreement depends on the attitude of US President Trump.

The Indian Business Line quoted sources saying that India wants to gain market access in "areas of interest," including some labor-intensive products, and to obtain priority in these areas. Another source revealed that India also proposed reducing tariffs on US goods in multiple areas.

Indian Finance Minister Nirmala Sitharaman said last month that the US is one of India's most important trading partners, and India hopes to reach a "big, good, and beautiful" trade agreement with the US, but agriculture and dairy products are two "red lines" in the negotiations. She emphasized: "We cannot do anything that would weaken our agriculture and farmers' status."

However, the main opposition party in India, the Congress Party, doubts whether the Modi government can truly stand firm against the US. Congress leader Rahul Gandhi said on May 5: "Remember what I say, Modi will obediently yield to Trump's tariff deadline."

Mukesh Aghi, Chairman of the US-India Strategic Partnership Forum, said: "No matter what the Indian government does, it will be seen as basically yielding to Trump's demands. So, they are now in a no-win situation."

According to a Reuters report, on July 4 local time, India notified the World Trade Organization that due to the US tariffs on cars and parts affecting Indian exports, India plans to impose retaliatory tariffs on the US. India stated that the US tariffs on the aforementioned products will affect exports worth $2.89 billion, and the tax amount for the US tariffs will be $725 million, and India will impose equivalent tariffs on "products originating from the US."

According to data from the Office of the US Trade Representative, bilateral trade between India and the US in 2024 was approximately $129 billion, with the US exporting $41.8 billion worth of goods to India and importing $87.4 billion, resulting in a trade deficit of $45.7 billion. Reuters said that in April to May this year, India's exports to the US increased from $14.17 billion to $17.25 billion compared to the same period last year.

This article is an exclusive piece by Observer News. Reproduction without permission is prohibited.

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