New Delhi/Washington: After five rounds of trade negotiations, Indian officials were so confident in securing a favorable agreement with the United States that they even signaled to the media that duty could be uncovered at 15%.
Indian officials expected that US President Donald Trump would announce the agreement weeks before the deadline of August 1st. The message never came.
New Delhi now has a surprise on a 9% duty on Indian goods from Friday, along with unspecified sanctions on Oil Import from Russia, while Trump has closed major agreements with Japan and the EU and even offered better conditions to the Pakistan rival.
Interviews with four Indian government officials and two US government officials did not previously reveal -demolished details of the proposed agreement and an exclusive account of how negotiations collapsed despite technical agreements on most questions.
The officials on both sides said that a mixture of politically wrong rating, unanswered signals and bitterness broke the agreement between the world’s largest and fifth largest economies whose bilateral trade is worth over $ 190 billion.
The White House, the US Trade Representative Office and the Prime Minister of Prime Minister, along with the external affairs and the Ministry of Commerce did not respond to E -Mail requests for comment.
India believed that after the visit of Indian Trade Minister Piyush Goyal to Washington and US Vice President JD Vance, Delhi had made a number of deal-clinching concessions.
New Delhi offered zero tariffs on industrial goods that formed approx. 40% of us export to India told two Indian Government Officers told Reuters.
Despite domestic pressure, India would also gradually lower tariffs on US cars and alcohol with quotas and join Washington’s greatest demand for higher energy and defense impact from the United States, officials said.
“Most differences were resolved after the fifth round of Washington, which raised hope for a breakthrough,” said one of the officials, adding dealers believed that the United States would meet India’s reluctance to duty -free farm imports and dairy products from the United States.
It was a wrong calculation. Trump saw the problem differently and wanted more concessions.
“A lot of progress was made on many fronts in India conversations, but there was never a deal that we felt good at,” a white house official said.
“We never came to what was a full deal – an agreement we were looking for.”
Overstood and Incorrect Calculation
Indian Prime Minister Narendra Modi, who visited Washington in February, agreed to target an agreement after the fall of 2025 and more than double bilateral trade at $ 500 billion by 2030.
To bridge the $ 47 billion commercial gap, India promised to buy up to $ 25 billion in US energy and increase defense imports.
But officials now admit that India grew over self -confidence after Trump spoke up to a “big” impending deal and took it as a signal that a favorable deal was in hand. New Delhi then hardened its attitude, especially on agriculture and dairy, two very sensitive areas of the Indian government.
“We are one of the fastest growing economies and the United States cannot ignore a $ 1.4 billion market,” an Indian official said in the mid -July negotiations.
Dealers even pressed for relief from the 10% average US customs announced in April, plus a return of steel, aluminum and car tasks.
Later, India scaled out expectations after the United States signed the trade with the most important partners, including Japan, and the European Union in the hope that it could secure a similar duty of 15% with fewer concessions.
It was unacceptable for the White House. “Trump wanted a headline-grabbing message with wider market access, investments and big purchases,” said a Washington-based source familiar with the negotiations.
An Indian official acknowledged that New Delhi was not ready to match what others offered.
South Korea, for example, entered into an agreement just before Trump’s deadline 1 August, securing a 15% rate instead of 25% by offering $ 350 billion in investments, higher energy imports and rice and beef concessions.
Distribution of communication
“At one point, both sides were very close to signing the deal,” said Mark Linscott, a former US trade representative, who is now working for a lobby group that is close to the discussions between the two nations.
“The lack of component was a direct line of communication between President Trump and Prime Minister Modi.”
An official in the White House strongly contested this, noting that other offers had been resolved without such an intervention.
An Indian government official involved in the negotiations said Modi could not have called, in fear of a unilateral conversation with Trump that could put him on the spot.
However, the other three Indian officials said that Trump’s repeated remarks on the dissemination of the Indian-Pakistan conflict further strained negotiations and contributed to Modi that did not make one last call.
“Trump’s remarks about Pakistan didn’t go down well,” one of them said. “Ideally, India should have acknowledged the American role while it made it clear that the last call was ours.”
A senior Indian government official accused the collapse of poor judgment and said the supreme Indian advisers abused the process.
“We lacked the diplomatic support needed after the United States entered into better agreements with Vietnam, Indonesia, Japan and the EU,” the official said.
“We are now in a crisis that could have been avoided.”
Trump said Tuesday that he would increase customs duties on India’s imports from the current rate of 25% “very significantly” over the next 24 hours and claimed that New Delhi’s purchase of Russian oil “burned the war” in Ukraine.
Repeat
Lectures are undergoing an American delegation expected in Delhi later this month, and Indian government officials still believe the deal can be saved from here.
“It’s still possible,” a White House official said.
The Indian government is investigating areas within the farm and dairy sectors where concessions can be made, the fourth official said. On Russian oil, India could reduce some purchases in favor of US supplies whose pricing is matched.
“It is likely to require direct communication between the prime minister and the president,” Linscott said.
“Download the phone. Right now we’re in a loss loss. But there’s a real potential for a win-win trade deal.”
