Trump hints at 20-25% tariffs on Indian goods, says deal not final yet

US President Donald Trump said on Tuesday (local time) that India could face tariff rates as high as 25 per cent on its exports to the US. He, however, emphasised that no final decision had been made yet. His remarks come as India and the US continue to work towards resolving long-standing trade disagreements.

Speaking to reporters aboard Air Force One while returning from a five-day visit to Scotland, Trump confirmed that trade discussions with India were under way, reported Bloomberg. When asked about the possibility of tariffs ranging from 20 to 25 per cent, he responded, “Yeah, I think so. India is my friend. They ended the war with Pakistan at my request. The deal with India is not finalised. India has been a good friend, but India has charged basically more tariffs than almost any other country,” Bloomberg quoted him as saying.

While addressing the press, Trump also reiterated his claim of having brokered a ceasefire between India and Pakistan following Operation Sindoor in May 2025. “They ended the war with Pakistan at my request,” he said.

US seeks more talks as India pushes for trade deal by 1 August

India is racing to finalise a trade deal with the US as the 1 August deadline approaches. Officials from both countries are engaged in continuous negotiations, although major disagreements remain unresolved. Trump has repeatedly said in recent weeks that both sides are close to reaching an agreement.

However, US Trade Representative Jamieson Greer told CNBC that talks with India might require more time, reported CNN. Greer noted that India had shown keen interest in opening segments of its market and said the US was open to continuing talks. However, he added that more negotiations would be needed to assess how far India was willing to go in terms of ambition.

Fifth round of trade talks ends without breakthrough

A negotiating team from India, led by chief negotiator Rajesh Agrawal, returned from Washington in July after concluding the fifth round of trade talks. The four-day dialogue ended without any breakthrough.

Key points of contention include disagreements over agriculture, automobiles and, more recently, digital trade—a sector that has become a new sticking point since March. These unresolved issues have stalled progress despite repeated attempts to bridge the gap.

India braces for higher tariffs, plans to resume talks

Citing two Indian government sources, Reuters reported that New Delhi is preparing for the possibility of higher tariffs, likely between 20 and 25 per cent on select exports as a temporary measure.

Rather than offering fresh concessions under pressure, India intends to resume broader trade negotiations in mid-August, during a scheduled visit by a US delegation.