Trump pursues a lower-tariff trade deal with India while casting doubt on Japan talks

Tariff-cutting deals with India are on the table even as negotiations between Washington and New Delhi reach a critical stage

ContentsProgress with India as tariff deadline nearsIndian officials remain cautiously optimisticUncertainty clouds US-Japan trade relationsPresident Donald Trump has predicted that the United States will have a trade relationship with India in the near future. He wants to cut import tariffs on Indian goods and increase American access to the South Asian market. In the meantime, negotiations with Japan do not seem so probable, and Trump has doubts about the future with Tokyo.

Progress with India as tariff deadline nears

In a discussion on board Air Force One, President Trump confirmed that India could soon open its markets to US firms. He said the trade agreement would drastically reduce tariffs, giving American businesses in South Asia a competitive advantage. India is one of the countries making efforts to evade an abrupt increase in US tariffs, which may be imposed after July 9, after the end of a 90-day suspension.

One of the foremost US Treasury Secretaries, Scott Bessent, wrote an interview on Fox News claiming that Washington and New Delhi were close to sealing the deal. Indian officials have moved recent meetings to Washington as they hope to sort out the outstanding issues before they are irreparably late. Two Indian government sources said that both are making efforts to harmonize trade on topics such as import charges on auto parts, steel, and agricultural commodities.

## Indian officials remain cautiously optimistic

During one of the events in New York, the Minister of External Affairs of India, Subrahmanyam Jaishankar, opened up by admitting that current problems still exist but remained hopeful. According to him, the negotiation was already halfway but he emphasized that there was still a need to draw compromises. He further said that so far, the process is in motion, but both sides have to establish a common ground so that they can succeed.

The US administration is trying to close deals with several countries before July 9. India, which stands to lose since its reciprocal tariff rate could increase to 27%, is advocating a solution. On both sides, authorities are trying to win a win-win deal on time before the new rates are implemented.

Uncertainty clouds US-Japan trade relations

Simultaneously, when the talks between the US and India gain momentum, there is no resolution on the matter of Japan. President Trump did not believe that Japan would be ready to cooperate, as the country still opposed the idea of buying American rice grown in the United States. When Japan fails to satisfy the expectations of the US, it proposes that tariffs levied on Japanese imports might increase to 30 percent, subsequently to 35 percent, as opposed to the 24 percent initially proposed in April.

The United Kingdom is the only country that has succeeded in striking a partial deal with the Trump administration. In exchange for trade access with aircraft engines and beef, the United Kingdom promised a 10 percent tariff on assorted products.