India-US trade signing on hold until new tariff framework, says commerce secretary
India-US trade signing on hold until new tariff framework, says commerce secretary
India says the India-US trade deal will be signed only after a new tariff architecture is in place, as US tariff scrutiny and legal shifts loom large.
New Delhi — The government says the India-US trade deal will be signed only after a new tariff architecture is in place. The commerce secretary emphasized that actual signing would hinge on the completion and acceptance of the revised tariff framework. This stance comes as the US Supreme Court recently struck down tariffs imposed during the Trump administration, labeling them illegal, a move that adds pressure to rethink tariff policy on both sides.
Officials familiar with the talks say a revised tariff architecture is central to the negotiation, aiming to offer a stable, predictable regime for businesses in both markets. The idea is to replace piecemeal tariffs with a comprehensive framework that can accommodate sectoral sensitivities while preserving market access. In practice, this could mean rebalancing duties across key sectors and establishing clearer rules on how any future tariffs would be assessed and implemented.
The timing of the signing matters for companies awaiting greater clarity on costs and supply chains. Observers note that any delay in the deal could ripple through pricing, investment plans, and planning cycles for manufacturers and exporters who had anticipated a sooner resolution. At the same time, officials say it is prudent to ensure that the tariff framework is robust enough to withstand legal and political shifts, reducing the risk of ad hoc changes that could disrupt commerce.
The broader policy backdrop includes ongoing US investigations into India under Section 301, addressing concerns about excess capacity and forced labor, among other issues. While these inquiries are distinct from the bilateral trade agreement, they influence tariff calculus and leverage in negotiations by signaling potential pressure points for upcoming decisions. Additionally, India has been diversifying its crude sourcing to bolster resilience against supply disruptions, a factor that trade negotiators say could affect bargaining dynamics by reducing vulnerability to external shocks.
Industry and policy watchers stress that the path to a formal signing remains contingent on consensus on the tariff architecture. Still, there is a shared interest on both sides to move forward where possible, balancing strategic protections with open market opportunities. As discussions continue, the focus will be on delivering a deal that offers predictable access for goods and services while safeguarding domestic industries from sudden tariff shocks.
