New Delhi draws ‘red lines’ in US trade talks – Indian finance minister

India has stated that agriculture and dairy must be excluded from any tariff agreement

Agriculture and dairy are “very big red lines” when it comes to trade negotiations with the US, Indian Finance Minister Nirmala Sitharaman told the Financial Express on Monday. The US and India are engaged in trade negotiations and racing to meet a July 9 deadline set by President Donald Trump, after which reciprocal tariffs will be imposed if an agreement is not reached.

“Agriculture and dairy have been among very big red lines, where a high degree of caution has been exercised,” Sitharaman told the newspaper. “There’s no way we could do anything that would weaken our agriculture, our farmers’ positions.”

Sitharaman expressed enthusiasm for a “big and beautiful” trade deal between India and the US – a reference to Trump’s language describing the desired agreement. However, she also indicated that India could seek better market access and consider reciprocal market openings.

In the interview, India’s finance minister explained that issues such as environmental regulations, sustainability, carbon taxes, government procurement, gender, and labor issues are increasingly being included in trade talks, although they were not traditionally part of such discussions. She added that India is carefully evaluating its position in each of these areas, considering its status as an emerging market with its own specific requirements. 

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In May, New Delhi said that it had proposed deep cuts in import tariffs on various goods, in an effort to reach a preliminary trade agreement with the US. This excluded agricultural products, such as grains and dairy items, according to Financial Times. New Delhi wants to secure a deal with Washington by July 9, when the US has threatened to impose a 26% reciprocal tariff on all Indian goods.

The US introduced an additional tariff on Indian products effective April 2, but it was suspended for a 90-day period. A standard 10% US tariff on certain of the country’s goods.

Trump has called India the “tariff king.” In February, India announced a reduction in customs duties on some items, including luxury cars and solar cells, in what was seen as an effort to address US trade concerns. New Delhi believes a successful trade agreement with Washington could “flip current headwinds into tailwinds,” the Indian Finance Ministry’s Monthly Economic Review said in May.