India should withdraw from all ongoing trade negotiations with the United States and prepare to engage with the Trump administration on similar terms as other major economies like China and Canada, according to the Global Trade Research Initiative (GTRI).
The economic think tank argues that the US is applying immense pressure on India to accept trade demands that overwhelmingly favour American interests.
Ajay Srivastava, founder of GTRI, stated that US President Donald Trump has publicly criticised India, often using inaccurate data.
He suggested that no balanced trade agreement could be reached under such conditions, urging India to step back from discussions and adopt a more strategic approach in dealing with Washington.
Srivastava pointed out that both China and Canada have responded to US tariffs with strong retaliatory measures.
On Friday, Trump claimed that India had agreed to lower tariffs on American goods after his administration "exposed" what he called unfair trade practices. GTRI dismissed this claim as incorrect and aimed at pressuring India into trade concessions.
US Commerce Secretary Howard Lutnick also stated that India must open its agriculture sector for negotiation, emphasising that it cannot be excluded from talks with its largest trading partner. He advocated for a broad trade agreement rather than a product-specific arrangement.
A recent GTRI report warned that a comprehensive trade deal with the US would not just focus on tariffs but could open doors to American demands related to government procurement, agricultural subsidies, patent laws, and unrestricted data flows, all of which India has consistently resisted.
The report highlighted that Trump’s history of disregarding trade agreements is evident from his decision to scrap the US-Mexico-Canada FTA, which he himself had finalised in 2019, and impose new tariffs on Canadian and Mexican imports.
To counter US demands, GTRI proposed that India consider a "Zero-for-Zero" approach, where over 90 per cent of industrial goods could have reciprocal tariff reductions—only if the US agrees to the same.
However, the report strongly advised against including agriculture, passenger cars, and other sensitive sectors, warning that an uncalculated move could harm India’s domestic economy.
The think tank cited Australia’s car industry collapse as an example, where a drastic tariff reduction led to the shutdown of domestic manufacturing.
It also pointed out that India’s automobile exports to the US are minimal, meaning that any potential tariff hikes by Washington would have little impact on Indian manufacturers.
Regarding agriculture, Srivastava strongly opposed the idea of opening the sector to US imports, noting that it supports over 700 million people in India compared to fewer than 7 million in the US.
He described it as a matter of livelihoods rather than a simple trade issue. Even minor concessions, he warned, could set a precedent for more aggressive US demands in the future.
GTRI also disputed US claims that India imposes excessively high tariffs, stating that while certain luxury goods such as alcohol and cars have high duties, the US itself applies extreme tariffs, including 350 per cent on tobacco.
The think tank further criticised the frequent misrepresentation of trade data by US officials, highlighting Trump’s claim that the US trade deficit with India is $100 billion, while official figures place it below $45 billion.
The report also noted that the White House has inaccurately stated that India imposes a 100 per cent tariff on Harley-Davidson motorcycles, when in reality, the duty was reduced from 50 per cent to 30 per cent.
Srivastava expressed disappointment that neither the Indian government nor industry associations have countered such misinformation.
At a time when other nations are standing firm against Trump's trade policies, he urged India to prioritise long-term economic resilience over short-term diplomatic appeasement.
If the US rejects the proposed "Zero-for-Zero" trade offer and imposes new tariffs, GTRI advised India to respond cautiously and only if necessary, as the impact on key industry sectors would likely be minimal.
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