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Trade negotiations delayed as US reviews tariff ruling
India and the United States have postponed this week's scheduled trade discussions after the US Supreme Court invalidated former President Donald Trump's global tariff policy, an Indian commerce ministry official confirmed to the BBC on Monday.
Background to the interim deal
An Indian delegation was set to travel to Washington to finalise terms of an interim agreement announced earlier this month. Under the deal, the US agreed to reduce tariffs on 55% of Indian exports from 50% to 18%, while India pledged to lower duties on American industrial and agricultural goods.
The announcement followed months of tension after Trump imposed 50% tariffs on Indian goods in August, including penalties for purchasing Russian oil. The February 2 phone call between Trump and Prime Minister Narendra Modi brought temporary relief to markets.
Unresolved questions linger
Analysts and farm unions have raised concerns about the deal's balance. Critics questioned whether India received equitable concessions, particularly regarding commitments to reduce Russian oil imports and a proposed $500 billion purchase of US goods over five years.
Commerce Minister Piyush Goyal clarified that India made no concessions on dairy, genetically modified products, meat, or poultry, and that farmer protections remained intact. However, full details of the agreement remain undisclosed.
Supreme Court ruling disrupts plans
The US Supreme Court's Friday decision struck down Trump's use of the 1977 International Emergency Economic Powers Act to impose broad tariffs, dealing a setback to his trade agenda. The ruling created fresh uncertainty about existing trade agreements.
Trump responded by announcing plans to raise global tariffs to 15% under a separate, previously unused trade law. The move further complicated the outlook for the India-US deal, which Goyal had suggested could take effect in April after final negotiations.
Next steps unclear
"Both sides have agreed to defer talks until they assess the implications of recent developments," the commerce ministry official said. Reuters reported that no new date has been set for the delegation's visit, originally planned for Sunday.
"The uncertainty surrounding US tariff policy has forced a pause in negotiations,"
Indian commerce ministry source
