India holds firm on U.S. tariffs: Why Goyal says ‘no deal under pressure’

India has responded firmly to United States President Donald Trump‘s executive order imposing blanket tariffs on goods from nearly 60 countries, including India, while temporarily suspending the additional duties for a 90-day period. Union Minister of Commerce and Industry Piyush Goyal made it clear that India would not allow the timeline of this temporary reprieve to dictate the terms of negotiation, stating unequivocally, “We never negotiate at gunpoint.” His remarks came on the sidelines of the Italy-India business, science and technology forum, at a moment when both countries are exploring a potential bilateral trade agreement.

Goyal’s statement highlights India’s broader trade strategy, one that is grounded in ensuring long-term economic sovereignty and a mutually respectful negotiating framework. While the pause in tariffs — effective from April 10 to July 9, 2025 — provides a window for discussion, Goyal emphasized that New Delhi would only engage in dialogue when national interests were secure and both parties demonstrated sensitivity to each other’s priorities. He noted that “favourable time constraints motivate us for quicker talks,” but said India would not compromise in haste if core issues remain unresolved.

What triggered Trump’s tariff move and how is India affected?

The latest executive order from the White House stems from Trump’s broader strategy to rebalance America’s trade deficit and reinvigorate domestic manufacturing. Effective April 2, President Trump implemented a universal 10% tariff on all goods imported into the U.S., with higher levies targeting countries like China and India. While India has been temporarily exempted from the additional duties, it still faces baseline tariffs and the uncertainty of policy reversals in July.

According to the executive order, “enforcement of the second paragraph of section 3(a) of Executive Order 14257 is suspended until 12:01 a.m. EDT on July 9, 2025.” This creates a narrow corridor for negotiation, but with limited predictability.

The affected Indian exports include seafood (particularly shrimp), steel, textiles, and automotive components—sectors that contribute significantly to India’s trade surplus with the U.S. The steel industry, in particular, had already been under strain from earlier tariff waves during Trump’s first term, and this move has reignited concerns among exporters about long-term access to American markets.

How does this align with India’s ‘India First’ and Viksit Bharat 2047 vision?

Piyush Goyal reiterated that India’s trade negotiations are structured around the principles of ‘India First,’ which seek to align economic diplomacy with the country’s broader developmental goals, including the vision of achieving a developed economy status by 2047—coined as “Viksit Bharat @ 2047.” The Amrit Kaal initiative, announced by Prime Minister Narendra Modi, reflects a national strategy to strengthen India’s position in global trade, supply chains, and innovation-led growth.

According to Goyal, all trade engagements must support India’s path toward economic self-reliance and value-driven exports. He assured exporters and industry stakeholders during a meeting on April 9 that the Indian side is working with “speed but not in undue haste” on the bilateral trade agreement with the United States. Negotiations are focused on achieving the right mix and right balance, ensuring that no concession undermines the domestic manufacturing base or labour-intensive sectors.

What’s the current state of India-US trade relations?

India and the United States are currently in discussions to finalise a bilateral trade agreement (BTA) that aims to more than double the current trade volume from approximately USD 191 billion to USD 500 billion by 2030. According to the Commerce Ministry, this target reflects a strong mutual desire to deepen strategic and economic ties.

In FY2023-24, the United States remained India’s largest trading partner with bilateral trade in goods valued at USD 119.71 billion. This comprised USD 77.51 billion in Indian exports and USD 42.19 billion in imports from the U.S., yielding a healthy trade surplus of USD 35.31 billion in India’s favour. Comparatively, China—India’s second-largest trading partner—accounted for USD 118.39 billion in two-way commerce but registered a massive USD 85 billion trade deficit, mainly due to heavy Chinese imports.

The U.S. constitutes 18% of India’s total goods exports and around 6.22% of its imports. These figures underscore the strategic importance of maintaining stable and mutually beneficial trade relations with Washington, even as India asserts its autonomy in global policymaking.

What does this mean for India’s exporters and trade outlook?

While the 90-day tariff suspension provides breathing space, Indian exporters remain cautious. Sectors such as textiles, gems and jewellery, pharmaceuticals, and IT services are among the most reliant on access to the U.S. market. Exporters have sought assurances from the government that their competitiveness will not be eroded by sudden policy shifts or retaliatory actions.

Goyal’s remarks served as a reassurance, urging exporters not to panic and to see the “silver lining” in the situation. He added that the government is proactively addressing sector-specific concerns and is committed to finding solutions that uphold both commercial interests and national priorities.

From a policy standpoint, the Indian government’s calibrated stance could enhance its credibility as a stable and principled negotiator on the global stage. It also offers the potential to strengthen domestic policy frameworks around trade facilitation, customs digitisation, and Make in India production incentives.

Could this reset future trade dynamics with the U.S. and other partners?

The current standoff is reflective of a broader shift in global trade architecture where developing economies like India are no longer passive participants but assertive stakeholders. India’s response to Trump’s tariff pause signals a new template for trade negotiations—one that prioritises equality, predictability, and shared benefit.

Experts note that while the 90-day window might appear short, it allows enough time for India to articulate its terms clearly and avoid rushed concessions. Moreover, given the current geopolitical landscape marked by supply chain realignments and U.S.-China economic decoupling, India’s role as a strategic alternative supplier has gained visibility.

From a historical perspective, India-U.S. trade ties have gone through multiple highs and lows—from the withdrawal of India’s GSP (Generalized System of Preferences) status in 2019 to tariff disputes at the WTO. Yet, both countries have consistently shown a willingness to reset ties and find new common ground. With the Biden administration’s trade agenda largely focused on friend-shoring and strengthening alliances, the dynamics under Trump 2.0 could once again tilt toward confrontation unless carefully managed.