Donald Trump on Monday signalled that the United States is close to finalising a trade agreement with India, as he extended the deadline for implementing the contentious April 2 “reciprocal tariffs” to August 1.
“We’ve finalised agreements with the United Kingdom and China, and we’re very close to securing a deal with India,” Trump said during a press briefing following a dinner with Israeli Prime Minister Benjamin Netanyahu at the White House.
Media reports say the two countries are likely to conclude trade negotiations in a couple of days. Negotiators from both sides were said to be in the final stages of talks.
While discussions with India appear to be progressing, the Trump administration has already issued formal tariff notices to 14 other countries, including Japan, South Korea, South Africa, Laos and Myanmar. These nations are set to face new duties — ranging between 25 and 40 percent — starting August.
In letters published on Trump’s Truth Social platform, Trump warned that any retaliatory tariffs would be met with proportional increases. He also confirmed that existing sector-specific levies — such as the 25 percent duty on Japanese vehicles — would remain unchanged and would not be subsumed under the new tariff regime.
“If for any reason you decide to raise your tariffs, then whatever percentage you choose will be added on top of the 25 percent we already charge,” Trump wrote.
The potential trade deal with India has prompted analysts to assess its likely impact across key sectors of the Indian economy.
Prashanth Tapse of Mehta Equities said India remains optimistic about securing a favourable agreement with the US, which could provide a lift to several industries.
“Sectors that could be in focus include automobiles and auto components, given the potential reintroduction of high import duties; steel and aluminium, which are already under pressure due to Section 232 tariffs; and pharmaceuticals, particularly API inputs, because of their strategic relevance and dependence on global supply chains,” Tapse noted.
Mohit Gulati of ITI Growth Opportunities Fund said the expiration of the US tariff pause could create a mixed scenario for Indian exporters. “In areas where India enjoys a strong global position — such as certain generic drugs and niche textiles — exporters could use their leverage to negotiate better terms with US buyers,” Gulati said.
However, he warned that other sectors — including gems and jewellery, electronics, broader textile categories and auto parts — may face greater uncertainty.
“While Indian firms might benefit from higher tariffs imposed on competitors like China and Vietnam, others could struggle with tighter margins and fiercer competition. Much will depend on sector-specific factors, government support measures, and the final structure of the India-US trade pact,” he added.
