NEW DELHI, India: India and the United States resumed trade talks in New Delhi on September 16, raising hopes of progress just weeks after U.S. President Donald Trump imposed steep tariffs on Indian goods over the country’s purchase of Russian oil.
The talks come after Trump adopted a softer tone last week, voicing optimism that a deal could soon be reached. Brendan Lynch, the U.S. trade representative for South Asia, arrived in New Delhi for a one-day round of discussions with India’s chief negotiator Rajesh Agarwal. Agarwal confirmed the meeting would form part of broader bilateral trade negotiations but did not provide further details.
Tensions flared last month when Washington introduced a 25 percent punitive levy on Indian imports effective August 27, doubling overall tariffs to 50 percent. The move was aimed at increasing pressure on Moscow following its invasion of Ukraine.
The measures have already hit Indian exporters. Data released this week showed exports to the U.S. fell to US$6.86 billion in August, down from $8.01 billion in July. Overall goods exports slid to a nine-month low of $35.1 billion, while the country’s trade deficit narrowed slightly to $26.49 billion. Exporters warned that the full impact of higher U.S. tariffs will be felt in September.
The renewed trade dialogue follows a turbulent period in relations. A planned U.S. delegation visit to New Delhi in late August was abruptly cancelled after negotiations stalled over India’s refusal to open its agriculture and dairy markets. At the same time, New Delhi has deepened diplomatic outreach with Beijing and Moscow. Prime Minister Narendra Modi traveled to China last month for his first visit in seven years, attending a summit hosted by President Xi Jinping. He was also pictured holding hands with Russian President Vladimir Putin.
Despite the tensions, U.S. officials signaled cautious optimism. Sergio Gor, Trump’s nominee to be ambassador to India, said last week that the two sides were “not that far apart” on tariffs and expressed confidence the differences could be bridged in the coming weeks.