U.S. Commerce Secretary Howard Lutnick has expressed optimism that the United States will "sort out" trade issues with India. In a recent CNBC interview, Lutnick stated that a trade deal hinges on India ceasing its purchase of Russian oil. He added, "Well, we're going to sort out India," once they stop buying Russian oil.
Lutnick's remarks come amidst ongoing trade negotiations between the two countries. He emphasized that India needs to liberalize its markets in addition to ceasing Russian oil imports. The Trump administration has already imposed a 25% additional tariff on India for its crude oil trade with Russia.
Despite India's firm stance on continuing to buy Russian oil, Lutnick predicted that India will eventually seek a trade deal with the U.S.. He stated that businesses will ultimately demand a deal with America. Lutnick took a jab at India, saying, "It's all bravado because it feels good to fight with the biggest client". He anticipates India will apologize and negotiate with President Trump, drawing parallels to Canada's trade concessions. He expects that within a month or two, India will be at the table to make a deal with Donald Trump.
Meanwhile, Union Commerce and Industry Minister Piyush Goyal indicated that the first tranche of the India-US trade deal is expected to be finalized by November 2025. Goyal stated that Prime Minister Narendra Modi and President Trump had instructed ministers from both sides to reach an agreement by November 2025. He added that discussions have been progressing seriously in a positive environment since March.
President Trump has also expressed optimism about the trade negotiations. He stated that the United States and India are continuing negotiations to address trade barriers and that he anticipates a successful conclusion for both countries. Prime Minister Modi echoed this sentiment, expressing confidence that the negotiations will unlock the potential of the India-US partnership.
However, India seems firm on tariff talks with the US, even as their bilateral relations sour on issues ranging from trade to foreign policy. Despite the 50% tariff imposed on Indian goods, analysts say Delhi is neither "desperate nor cornered".
Reports suggest that Rajesh Agarwal, India's chief trade negotiator, will travel to Washington for continued discussions with American officials. Both leaders are also expected to hold a telephone discussion soon.
The aim of the trade pact is to more than double bilateral trade in goods and services to USD 500 billion by 2030 from the current USD 191 billion.
