India must disengage from ongoing trade negotiations with the United States and adopt a more calculated approach akin to that of nations such as China and Canada, according to the Global Trade Research Initiative (GTRI). The organization asserts that Washington is mounting significant pressure on New Delhi to acquiesce to trade stipulations that overwhelmingly serve American economic interests.
Ajay Srivastava, founder of GTRI, underscored that U.S. President Donald Trump and his administration have frequently misrepresented trade statistics to justify their critical stance against India. “Trump is publicly disparaging India, deploying erroneous data to support his claims. In such a scenario, achieving an equitable trade accord is unfeasible. India must step away from negotiations and prepare to engage with the U.S. on equal footing, mirroring strategies employed by other global powers,” Srivastava asserted.
In response to American tariffs, both China and Canada have implemented retaliatory measures. However, India’s silence in the face of repeated provocations from the U.S. has been perplexing, he noted. On Friday, Trump alleged that India had agreed to slash tariffs on American imports following his administration’s revelation of what he described as unjust trade practices.
“This assertion is patently misleading and serves only to strongarm India into compliance. The global community is observing closely as Trump and his officials persistently undermine India’s economic stance,” Srivastava remarked.
Meanwhile, U.S. Commerce Secretary Howard Lutnick has insisted that India must liberalize its agricultural market, contending that it cannot remain a protected sector while negotiating with its largest trading partner. He has advocated for a comprehensive trade pact rather than a piecemeal, product-by-product arrangement.
A recent GTRI report warns that a sweeping trade agreement could expose India to a plethora of U.S. demands, extending far beyond tariff reductions. These could encompass government procurement policies, agricultural subsidies, intellectual property laws, and the deregulation of cross-border data flows—domains where India has historically maintained firm resistance.
“Furthermore, Trump’s propensity to disregard previously negotiated trade agreements is evident in his abandonment of the US-Mexico-Canada Free Trade Agreement, a deal he himself had endorsed in 2019. His imposition of steep tariffs—25 percent—on Canadian and Mexican imports is further testament to his erratic trade policies,” the report elaborated.
GTRI has proposed that India explore a reciprocal tariff arrangement covering over 90 percent of industrial goods under a “zero-for-zero” framework—wherein India eliminates tariffs only if the U.S. reciprocates in kind. However, it cautioned that critical sectors such as agriculture and automobile manufacturing must remain protected.
To illustrate the potential consequences of reckless tariff concessions, the report cited Australia’s auto industry collapse following its decision to slash car import duties from 45 percent to a mere 5 percent in the late 1980s. Given that India’s passenger car exports to the U.S. are minimal—less than $13 million—the imposition of American tariffs would have negligible impact on India. However, any undue tariff reductions on India’s part could set a precedent for further unwarranted demands.
Regarding agriculture, Srivastava, a former official at India’s Department of Commerce, voiced staunch opposition to U.S. pressures to open the sector. He emphasized that India’s agricultural economy sustains over 700 million people, in stark contrast to the fewer than 7 million engaged in farming in the U.S.
“This is not merely a matter of trade but one of national livelihood security. Even marginally opening our agricultural sector to U.S. imports could create a perilous domino effect, with mounting pressure for further concessions,” he warned. He also noted that tariffs on key U.S. agricultural exports to India are already relatively low.
For example, the import duty on almonds stands at ₹35 per kilogram, equating to a modest 5 percent at the prevailing import price of ₹700/kg. Similarly, pistachios are subject to a 10 percent tariff, while ethyl alcohol faces only a 5 percent duty. Given that India’s total agricultural, dairy, and marine exports to the U.S. amount to a mere $5 billion, retaliatory U.S. tariffs would pose minimal economic harm to India. However, ceding to American demands now would likely embolden future attempts to expand the list of trade concessions.
Addressing allegations that India is a “tariff king,” Srivastava pointed out that while New Delhi maintains high tariffs on select luxury items—such as a 150 percent duty on wines and spirits and a 100 percent duty on automobiles—the U.S. itself imposes exorbitant tariffs, including a staggering 350 percent on tobacco.
Contrary to Trump’s claims, India’s overall weighted tariff rates on U.S. goods are only marginally—4.9 percent—higher than the tariffs America applies to Indian products. Furthermore, U.S. officials have frequently distorted trade figures to support their narrative.
“For instance, Trump has repeatedly asserted that the U.S. trade deficit with India stands at $100 billion, whereas India’s official figures place it below $45 billion,” Srivastava explained.
Additionally, he highlighted the White House’s misleading statement that India levies a 100 percent tariff on Harley-Davidson motorcycles—a rate that was actually reduced from 50 percent to 30 percent as of February 1.
“It is disconcerting that, despite such repeated misrepresentations, neither the Indian government nor domestic industry bodies have stepped forward to counteract this misinformation,” Srivastava lamented.
At a time when numerous nations are pushing back against Trump’s aggressive trade policies, India must assert itself in a similar fashion, prioritizing long-term economic resilience over short-term appeasement. Should the U.S. reject the “zero-for-zero” framework and instead resort to reciprocal tariff impositions, India should exercise restraint, retaliating only where absolutely necessary, as trade data suggests that well-calculated countermeasures would inflict minimal harm on most industrial sectors.
