US and India Trade Negotiations Remain Stalemate as High-Level Talks Continue

US Secretary of State Marco Rubio and India’s External Affairs Minister Subrahmanyam Jaishankar held a phone call on Tuesday to discuss ongoing trade negotiations and broader economic ties. The call came as both countries attempt to resolve months of stalled discussions aimed at finalizing a bilateral trade agreement.

The conversation focused on trade, critical minerals, and energy security, in addition to civil nuclear cooperation. Jaishankar later posted on social media that the discussion was productive and covered a range of strategic areas.

The timing of the call follows recent remarks by US Commerce Secretary Howard Lutnick, who blamed a lack of progress on the trade deal on Indian Prime Minister Narendra Modi not calling President Donald Trump. India has rejected these claims as inaccurate.

Why Has a Trade Deal Remained Out of Reach?

Trade negotiations between the US and India have faced repeated delays. Lutnick recently stated that India was given a "shot clock"—or a three-Fridays window—to finalize a deal last year. Despite multiple rounds of discussions and several calls between Modi and Trump, an agreement has yet to be reached.

India’s foreign ministry emphasized that the two sides have been "close to a deal" multiple times since early 2025. However, the negotiations stalled around July 2025, and the deal has yet to be finalized.

The US imposed 50% tariffs on Indian goods in August 2025, partly in response to India’s continued purchases of Russian oil. Washington has warned of further escalation, including raising tariffs to 500% if India does not reduce its oil imports from Russia.

What Are the Stakes for Global Markets?

The delay in a US-India trade deal has created uncertainty for investors. The rupee hit record lows in recent months as markets awaited progress in the negotiations. The failure to reach an agreement has also raised questions about the broader US trade strategy under President Trump, which includes high tariffs on several major trading partners.

Gold prices have also been affected by the geopolitical tensions, with the metal trading near $4,500 as markets weigh the risk of further trade restrictions and potential legal challenges in the Supreme Court.

Analysts say the outcome of the Supreme Court ruling on Trump’s tariffs could have wide-reaching implications for global markets. If the court rules against the administration, the US government may face pressure to issue refunds for tariffs already collected.

What Comes Next for US-India Trade?

The US and India remain committed to reaching an agreement, according to both sides. US Ambassador to India, Sergio Gor, said the two countries are "close partners" and will work to resolve their differences.

Jaishankar and US Secretary of State Rubio have emphasized the importance of expanding cooperation in energy, critical minerals, and civil nuclear power. Both sides have reiterated their goal of doubling bilateral trade to $500 billion by 2030.

Despite the optimism, the path to a deal remains unclear. India has sought a tariff rate between 10% and 20%, similar to deals the US has reached with the UK and Vietnam. However, those offers have since expired.

With the US presidential election approaching, the urgency for a resolution may increase. Both countries have expressed a desire to finalize the deal soon, but the challenges—ranging from tariff disagreements to geopolitical concerns—continue to complicate the process.