Trump Close to India Trade Deal as New Tariffs Hit 14 Countries from August 1
K N Mishra
08/Jul/2025

What's covered under the Article:
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Trump reveals the US is close to finalising a trade deal with India amid global tariff tensions.
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New tariffs ranging from 25% to 40% will be imposed on goods from 14 countries starting August 1.
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Trump softens stance on deadline, says he's open to adjustments based on countries' responses.
US President Donald Trump has signalled a significant development in international trade policy, hinting that the United States is “close to making a deal with India,” even as he issued letters to 14 other countries announcing new reciprocal tariffs that will be imposed starting August 1, 2025. The announcement marks a key moment in global trade strategy, with India potentially exempted from harsh levies amidst a rising tide of protectionist measures by the United States.
Speaking from Washington, Trump stated, “We are close to making a deal with India. We have made a deal with the United Kingdom. We have made a deal with China.” His remarks come amid the rollout of a tariff spree affecting a wide range of US trading partners. The move is being seen as part of Trump’s broader strategy to reshape global trade dynamics and prioritise American economic interests.
Trump's administration sent official letters to 14 countries, including Japan, South Korea, Bangladesh, and Thailand, warning them about upcoming tariffs if trade terms aren't renegotiated. While some countries may still have the opportunity to engage in talks, Trump made it clear that those unwilling to cooperate would be subject to heavy levies. This latest development follows his consistent pattern of using trade threats as leverage to secure better terms for the United States.
The new measures are part of Trump’s reciprocal tariff policy, which seeks to match or exceed the import duties that US exports face in other countries. In his Truth Social post, Trump disclosed the proposed tariff structure as follows:
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25% on South Korea
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25% on Japan
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40% on Myanmar
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40% on Laos
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30% on South Africa
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25% on Kazakhstan
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25% on Malaysia
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25% on Tunisia
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32% on Indonesia
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30% on Bosnia and Herzegovina
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35% on Bangladesh
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35% on Serbia
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36% on Cambodia
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36% on Thailand
These tariffs are scheduled to take effect on August 1, giving the affected countries a short window to respond or negotiate. Trump, however, was quick to clarify that while the deadline is “firm,” it is not 100% firm, suggesting that the administration remains open to last-minute adjustments. This flexibility could prove crucial for countries that wish to avoid the economic burden of increased tariffs by coming to the negotiation table.
Trump explained, “If they call up and they say we’d like to do something a different way, we’re going to be open to that.” This softer stance on enforcement contrasts with the otherwise aggressive tone of the letters sent. His remarks were made during a joint press interaction with visiting Israeli Prime Minister Benjamin Netanyahu, highlighting the global attention such trade decisions are garnering.
In the meantime, India appears to be on a different trajectory. While not explicitly mentioned in the list of 14 countries affected by the upcoming tariffs, India is being highlighted as a potential trade ally, with negotiations reportedly in the final stages. This could lead to a US-India bilateral trade agreement, marking a new chapter in relations between the two democracies.
The India-US trade relationship has faced several challenges in recent years, including disputes over tariffs, intellectual property rights, data localisation, and digital trade regulations. However, Trump's latest comments suggest that a breakthrough is on the horizon, potentially easing tensions and fostering economic cooperation between the two nations.
Trump’s administration also announced that he would sign an executive order delaying the earlier July 9 tariff deadline to August 1. This delay is intended to give affected countries more time to adjust their positions or engage in meaningful negotiations. However, it also adds uncertainty to the global market, as investors and businesses remain unclear about the final scope of these tariffs.
Experts believe this strategy is designed to pressure other nations into trade concessions, using the threat of imminent tariffs as leverage. At the same time, by publicly praising India's cooperation, Trump may be encouraging other countries to follow India’s lead and engage constructively with the US on trade issues.
The White House has not yet provided specific details about the contents of the potential India-US trade agreement, but analysts speculate it may cover agricultural exports, digital trade, pharmaceutical access, and industrial goods. India's recent policy adjustments, including the lowering of import duties on certain US products, may have played a role in softening Trump’s stance.
This development is seen as part of Trump’s larger “America First” economic agenda, which prioritises domestic manufacturing, fair trade practices, and reducing the US trade deficit. His administration has frequently used tariffs as a tool to reshape foreign trade relationships, regardless of international backlash.
Critics argue that such policies risk igniting a global trade war, especially if countries respond with retaliatory tariffs. Some have already begun consultations with the World Trade Organization (WTO), and further legal challenges could emerge if affected nations deem the US tariffs to be in violation of international trade rules.
Supporters, on the other hand, believe Trump's approach is finally addressing decades of unequal trade practices and could result in more favourable terms for American businesses. By showcasing India as a positive example of cooperation, Trump might be attempting to create a template for future trade agreements.
In summary, President Trump’s recent comments and policy announcements mark a pivotal moment in global trade. While 14 nations brace for higher tariffs, India finds itself in a favourable position, potentially avoiding economic penalties through active engagement with the US. As the August 1 deadline looms, the international community watches closely, waiting to see whether diplomacy or economic confrontation will shape the future of global commerce.
The evolving nature of these negotiations and tariff announcements will have a direct impact on global markets, supply chains, and trade flows. Investors, policymakers, and businesses must stay alert as US foreign trade policy under Trump continues to unfold in dramatic fashion, with India possibly emerging as a key ally amidst the turbulence.
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