Amid ongoing trade discussions between Indian and US officials, US President Donald Trump has recently expressed optimism about finalizing a trade deal with India. Trump hinted that India could be among the nations with which the US strikes a deal before reciprocal tariffs are imposed on August 1.

Trump's recent remarks follow a breakthrough in trade negotiations between the US and Indonesia, where tariffs were reduced from 32% to 19%. When asked about the possibility of similar deals with other countries before the August 1 deadline, Trump suggested that an agreement with India was likely. He expressed satisfaction with the letters exchanged with trade partners, possibly referring to letters dictating tariff rates on imports.

"We made a deal with the United Kingdom, we made a deal with China, we're close to making a deal with India," Trump stated, highlighting progress on various trade fronts. In a separate statement, Trump noted, "We have another deal coming up, maybe with India". He also indicated that the US is aiming for greater access to the Indian market, similar to the agreement reached with Indonesia. "We made a terrific deal, he (Indonesian President) opened up the entire country to trade with the United States. We were not allowed to go in and trade. I think something similar would happen with India and we have a couple of others," Trump said.

Since Monday, Indian and US officials have been engaged in discussions in Washington regarding the proposed bilateral trade agreement. These talks are expected to conclude on July 17.

While Trump administration is reportedly considering offering India a tariff rate below 20%, India seeks a tariff rate lower than the 19% finalized for Indonesia, aiming for a competitive edge over its regional peers.

Earlier this month, India's Commerce Minister Piyush Goyal emphasized that India would not rush into any trade agreement based on deadlines. Goyal stated that India will only accept a proposed trade deal with the US once it is finalized, properly concluded, and aligns with the nation's interests.

If the US and India fail to reach a tariff agreement before August 1, an additional 16% reciprocal levy will be imposed on Indian goods, adding to the existing 10% baseline tariff.

India has remained firm on safeguarding its agricultural and dairy sectors, resisting duty concessions for these products. Outstanding issues related to tariffs on steel, aluminum (50%), and automobiles (25%) also persist.