India Seeks Full Tariff Waiver from US Before July Trade Deal Deadline

India is asking the United States to remove an extra 26% tax on its exports completely. This request comes as both countries work quickly to finalize a trade agreement before July 8, according to a report by PTI. The tax, called a reciprocal duty, was first put in place by the Trump administration on April 2. However, it is currently on hold until July 9 to allow time for talks. A separate 10% base tax still applies.

India hopes to get rid of both taxes through the new deal. The agreement is likely to cover goods, non-tariff issues, and services like digital trade. In return, India may offer limited openings in sensitive areas such as agriculture and dairy, possibly through import limits or set pricing. A government official said, “We’re aiming to finish the first part of the deal before July 8.” The main goal is to lower costs for sectors like textiles, leather, and gems and jewellery, which employ many people in India.

Commerce Minister Piyush Goyal met top US trade officials in Washington this week to speed up the discussions. Talks among key negotiators are expected to continue until May 22. The US wants India to lower taxes on products like electric vehicles, wines, chemicals, and farm goods such as apples, nuts, and dairy. But India is still against importing genetically modified crops. It is open, however, to allowing non-GM feed items like alfalfa hay.

Both sides hope to finish the first stage of a larger trade agreement by autumn. They want to grow their trade to $500 billion by 2030. The US has been India’s biggest trading partner for the past four years. Trade between the two countries reached $131.84 billion in 2024–25. India had a $41.18 billion trade surplus with the US during that time, which has caught Washington’s attention.

While India seeks tax relief, the US is asking India to remove other trade barriers that affect American products. “There’s strong intent on both sides to make use of these 90 days,” the official said, adding that more talks could happen if needed.