Is India on the Brink of a Major Trade Deal with the US? Insights from GTRI

India's Potential Trade Agreement with the US

New Delhi: India is poised to potentially finalize a trade agreement with the United States in the near future, as President Trump intensifies his approach by sending formal tariff notifications to various nations. However, the Global Trade Research Initiative (GTRI) advises that India should proceed with caution.

According to GTRI, "Trump's strategy resembles not a traditional free trade agreement but rather a Yielding to American Tariff Retaliation Agreement (YATRA)."

The US has extended the deadline for countries to finalize their bilateral trade agreements from July 9 to August 1, providing a crucial three-week period before new country-specific tariffs are implemented.

This extension is part of a larger trade initiative that began on April 2, when Trump identified around 60 nations that would face special tariffs unless they aligned their trade agreements with US interests.

Currently, only the United Kingdom and Vietnam have met these requirements, while a temporary agreement with China is also in effect.

GTRI Founder Ajay Srivastava noted that Trump is ramping up the pressure. On July 7, he issued formal letters to 14 countries detailing the tariffs they would incur starting August 1 if they do not finalize a deal.

Recently, the Trump administration announced a range of tariffs: 25% on Japan, South Korea, Kazakhstan, Malaysia, and Tunisia; 30% on South Africa and Bosnia and Herzegovina; 32% on Indonesia; 35% on Bangladesh and Serbia; 36% on Cambodia and Thailand; and 40% on Laos and Myanmar.

Srivastava emphasized that these warnings, termed 'final notices' by the White House, present countries with a clear choice: agree to US terms or face significant tariffs.

He further explained that the increase in tariffs is likely to disrupt trade patterns, raise consumer prices in the US, and create broader complications in global supply chains.

In May 2025, US imports from China saw a decline of 35% compared to the previous period.

As the deadline approaches, India is viewed as a leading candidate for a trade deal announcement in the upcoming days. However, caution is advised.

With the US demonstrating a willingness to impose unilateral conditions, particularly on BRICS nations, India must carefully consider the strategic benefits of engagement against the potential risks of an unbalanced agreement.