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India-US trade talks appear to have hit another roadblock. Twenty months after negotiations began, the deal has stalled for a third time.
What’s going on: speaking at an event in New Delhi, Finance Minister Nirmala Sitharaman said the talks had reached a ‘plateau’. Put simply, both sides have reached a point where making further concessions would be “very, very difficult”.
She said the US wants to recover what it believes it has lost in trade over the years. That leaves less room for compromise.
Sitharaman also questioned the growing use of tariffs to tackle trade imbalances, saying countries had traditionally resolved such differences through negotiations.
Her comments came days after US Trade Representative Jamieson Greer said the deal was in its final stages, but an agreement was not imminent. Talks remain active, with some issues still unresolved.
Greer also said President Donald Trump and Prime Minister Narendra Modi could speak again soon to review progress.
A quick refresher: in February this year, India and the US announced an interim framework for a trade pact. It outlined plans to lower tariffs, strengthen energy ties and deepen economic cooperation.
But negotiations have faced repeated setbacks. In August 2025, US negotiators cancelled a round of talks in New Delhi as tariffs on Indian goods climbed towards 50%. In February 2026, Indian negotiators postponed a planned US visit amid uncertainty over tariff rules.
Here’s how those rules have changed:
- February 7: The US withdrew the additional 25% tariff imposed on Indian goods over India’s purchases of Russian oil.
- February 20: The US Supreme Court struck down the reciprocal tariff system. Indian goods returned to the regular US import duty rates.
- February 24: The US introduced an additional 10% global tariff for 150 days. Indian goods faced this charge on top of regular import duties.
- July 24: After the global tariff expired, the US replaced it with an India-specific 10% tariff under Section 301, citing forced-labour concerns. For most affected Indian exports, the total duty remained unchanged.
- September 18: Trump signed the Sanctioning Russia and Iran Act, authorising tariffs of up to 100% on countries buying Russian oil and gas, including India and China. This created a fresh tariff threat.
Where tariffs stand now: most covered Indian exports face the additional 10% Section 301 tariff on top of regular US import duties, with some products excluded.
Separate sector-specific tariffs include 50% on steel and aluminium and 25% on auto components. Smartphones, medicines and energy products are exempt from the additional India-specific tariff.
For example, an Indian shirt with a regular import duty of 5% would face another 10%, taking its total tariff to 15%.
That changing tariff backdrop has made an already difficult negotiation harder to close.
