Industry Odisha Bureau, Oct 07: India and the US keep talking at the highest levels. But a 25% tariff and visa friction weigh on ties. With trade talks stalling, New Delhi faces a longer test of economic resilience.
Diplomatic channels between New Delhi and Washington remain busy. Technocrats, defence officials and top political leaders continue to engage. Yet that engagement has not settled the commercial disputes now crowding the relationship. Tariffs, Russian oil and slow trade talks sit at the centre.
Pressure on two fronts
The US has imposed an additional 25% tariff on India. Washington tied the levy to India’s purchases of Russian oil. China did not face a similar penalty. Such a levy raises the stakes of every round of talks.
Donald Trump’s targeting of the H-1B visa programme has added further friction. Together, these steps have made his second term a turbulent period for India-US relations.
Dialogue without resolution
The relationship is strained, not broken. Meetings continue at the highest political level. Defence and technical teams remain engaged as well. But talking has not resolved every dispute. That gap between strategic contact and commercial outcomes defines the current phase.
Talks lose momentum
The two countries have announced a trade deal. A full trade agreement, however, remains under negotiation. The distinction matters. A deal signals political intent; an agreement settles binding terms.
Finance Minister Nirmala Sitharaman has said the talks are “plateauing”. She cited differences that are difficult to reconcile. She did not specify which issues remain open.
Agriculture as a pressure point
Agriculture appears a likely sticking point, though probably not the only one. The US farm sector is large and heavily subsidised. Opening Indian markets to it could put mass livelihoods at risk. That makes farm concessions politically and economically sensitive for New Delhi.
A harder bargain
US economic policy now leans harder on reciprocal gains and tariff pressure. The shift appears rooted in wider currents such as the MAGA movement. That suggests US attitudes towards India may not change quickly. For New Delhi, it means planning for prolonged, tougher bargaining.
India has expedited trade deals and talks with other developed economies. Diversification helps, but the US market is different. Its size and farm subsidies make the terms harder to settle.
Why walking away is costly
Even so, India retains large stakes in US trade ties. Difficult engagement with the world’s largest economy still beats no engagement. Disengagement would carry real economic costs. That argues for sustained effort to rescue the current negotiations.
Resilience as leverage
The longer lesson lies at home. External pressure exposes internal weaknesses that India must address. Stronger domestic competitiveness can reduce vulnerability to shifts in foreign policy. It may also strengthen India’s hand in future negotiations. Trade diversification forms part of that effort. But it complements, rather than replaces, the US relationship.
Managing a harder partnership
Strategic dialogue between the two countries continues. Commercial gaps, however, remain wide. India faces a dual task. It must keep Washington engaged while building economic strength of its own.
