Roving Periscope: India bargains hard; Trump extends tariff deal deadline to Aug 1
Virendra Pandit
New Delhi: With India bargaining hard and declaring that any trade and tariff deal with the US—indeed any country—will depend on protecting national interest, President Donald Trump, who was hoping to ink a mini-agreement or interim trade deal, has extended the reciprocal tariff deadline to August 1.
Simultaneously, however, he imposed 25 percent tariff on Japan and South Korea and put on notice many other countries as the 90-day pause on reciprocal tariffs closes on July 9 (Wednesday).
On July 6, Union Commerce and Industry Minister Piyush Goyal said: “We negotiate keeping national interest in mind, not under deadlines.”
According to officials, India has already made its stand clear to the US authorities on the interim trade deal and the ball is now in Washington’s court.
With the US extending suspension of these tariffs, Indian exporters felt a brief respite, although the bourses did not reflect it on Tuesday.
The proposed tariffs, covering a dozen countries, may provide India more comparative advantage if it finalises a Bilateral Trade Agreement (BTA) with the US, at least on goods, by the end of this month.
According to the media reports on Tuesday, the US extended the suspension of its April 2 reciprocal tariffs until August 1, providing a brief relief to Indian exporters and additional time for New Delhi and Washington to resolve pending issues to finalise an interim trade deal.
India, which is negotiating a trade pact with the US, was not included in the list of countries that received tariff letters from the Trump administration on Monday.
Washington sent the first tranche of letters to various countries detailing the tariffs the US will impose on products from those countries entering American markets from August 1.
Besides Japan and South Korea, Bangladesh, Indonesia, Malaysia, Thailand, South Africa, Bosnia and Herzegovina, Cambodia, Kazakhstan, Lao, Serbia and Tunisia are among the countries that received letters signed by President Donald Trump.
“…based on additional information and recommendations from various senior officials, including information on the status of discussions with trading partners, that it is necessary and appropriate to extend the suspension effectuated by Executive Order 14266 until 12:01 a.m. Eastern daylight time on August 1, 2025,” the White House said.
On April 2, the US President announced reciprocal tariffs against a number of countries, including India (26 percent), but paused the implementation of these duties for 90 days, giving all trading partners a July 9 deadline to negotiate and reach a trade deal with Washington.
Commenting on this decision, exporters said the deferment of the imposition of reciprocal tariffs from July 9 to August 1 reflects the US’ willingness to engage constructively with its trading partners.
“It provides an extended window for dialogue, which can help our negotiators to sort out remaining contentious issues,” Federation of Indian Export Organisations (FIEO) Director-General Ajay Sahai said.
He said that the proposed tariffs, covering a dozen countries, may provide India more comparative advantage if it finalises a BTA with the US, at least on goods, by the end of this month.
Another exporter said the decision will give relief to the domestic industry as the Indian official team has got some 12-13 more working days to talk to their US counterparts on the interim trade deal.
International trade expert Biswajit Dhar said: “I see this as a relief for us and this response has come due to India taking a strong stand on certain issues.”
FIEO President SC Ralhan, who is also a Ludhiana-based engineering exporter, said though this is a small relief, “we are keeping our fingers crossed.”
Mumbai-based exporter and founder of Technocraft Industries (India) Sharad Kumar Saraf said that President Donald Trump is “very unpredictable.”
“The period of tariff suspension is very small. Indian exporters should explore new markets to increase exports,” Saraf said.
India and the US, negotiating a BTA, have set a deadline to conclude the first tranche by Fall (September- October) this year. Before that, they are looking to finalise an interim trade deal.
The US has been India’s largest trading partner since 2021-22. In 2024-25, the bilateral trade in goods stood at USD 131.84 billion (USD 86.51 billion worth of exports, USD 45.33 billion of imports and USD 41.18 billion trade surplus).
