India-US Trade Deal / Trump shows leniency before trade deal, postpones sword of tariff on India till August 1

India-US Trade Deal: Uncertainty remains over the proposed trade deal between the US and India, but in the meantime, US President Donald Trump has taken a soft stand and postponed the decision to impose retaliatory tariffs on India till August 1. This decision has brought great relief to Indian exporters, as well as both countries have got additional time to resolve pending trade issues.

Trump's letter and tariff postponement

The Trump administration on Monday sent letters to various countries, detailing the duties to be imposed by the US on their products. Notably, India was not included in these countries. It is worth noting that on April 2, the US had announced to impose 26% additional tariffs on Indian goods, which was postponed for 90 days. This period was to end on July 9, but now it has been extended till August 1.

Apart from this, through an executive order, Trump has also deferred the increased tariffs on countries like Bangladesh, Bosnia and Herzegovina, Cambodia, Indonesia, Japan, Kazakhstan, Lao People's Democratic Republic, Malaysia, Serbia, South Africa, South Korea, Thailand and Tunisia till August 1. Exporters say that this move reflects America's desire to have a constructive dialogue with its trading partners.

India-US trade: A look

The US has been India's largest trading partner since FY 2021-22. In FY 2024-25, bilateral trade between the two countries reached US $ 131.84 billion. In this, India's exports were $ 86.51 billion and imports were $ 45.33 billion, resulting in a trade surplus of $ 41.18 billion for India. This figure reflects the strong trade relations between the two countries.

Reaction of Indian exporters

International trade expert Vishwajit Dhar described the moratorium as a relief for India. He said, "This is a positive step for India. This decision may be the result of India taking a tough stand on some issues." At the same time, Sharad Kumar Saraf, a Mumbai-based exporter and founder of Technocraft Industries (India), said that Trump's behavior is "extremely unpredictable". He suggested that Indian exporters should look for new markets, as the duration of the duty moratorium is very short.

Progress towards trade deal

India and the US are negotiating a bilateral trade agreement, the first phase of which is targeted to be completed by September-October this year. Indian officials have made their stand clear on the interim trade agreement, and now the ball is in the US court. The agreement is expected to further strengthen trade relations between the two countries, but resolving pending issues still remains a challenge.