The ink barely dry on India’s free trade agreement with the European Union, and already it’s rippling through global trade dynamics—most notably pressuring the United States to clinch its own deal with New Delhi. Farwa Ameer from the Asia Society Policy Institute attributes this momentum directly to the EU success, calling it a ‘game-changer’ in ongoing India-US talks.
In a Monday briefing, Ameer detailed how the EU pact’s timing amplified urgency for Washington. Pre-existing negotiations gained fresh impetus, culminating in Prime Minister Narendra Modi and President Donald Trump’s joint declaration of a trade breakthrough. Key concessions include the US cutting import duties on Indian goods from 25% to 18%, alongside lifting a Russia-related punitive levy.
This outcome followed 12 months of grueling discussions, fraught with tensions, resolved ultimately through direct leader-level intervention via phone. Yet, Ameer warns, India’s balancing act with Russia persists. ‘Oil import shifts notwithstanding, New Delhi prioritizes steady Moscow relations,’ she noted.
Adding perspective, Wendy Cutler, a heavyweight in trade circles with her past role as Acting US Trade Rep, forecasts gains for Indian exporters over Southeast Asian rivals. ‘At 18% tariffs versus 19-20% for ASEAN, this tilts the scales favorably,’ she said. Cutler speculated on a superior US deal compared to the EU, citing India’s pledges on barriers, albeit with Trump’s messaging lacking full clarity.
The president’s online proclamation envisions India zeroing out barriers against America. In Cutler’s view, the agreement paves pathways for joint efforts in critical minerals, tech partnerships, and resilient supply chains—strategic wins amid global uncertainties.
As these developments unfold, India’s Foreign Minister S. Jaishankar heads to Washington for critical minerals talks, underscoring deepening strategic alignment.