India must resist mounting trade pressure from the United States under President Donald Trump and avoid compromising its core sectors, particularly agriculture, warned the Global Trade Research Initiative (GTRI) in its new report.
The think tank cautioned that entering a trade agreement under duress could lead to “irreversible consequences,” especially given the uncertainty surrounding the continuity of such deals in a volatile US political landscape.
“India should stay the course and avoid trading away core sectors like agriculture. A hasty deal under pressure could have irreversible consequences, especially when such agreements may not survive the next shift in US politics,” the GTRI report stated.
The report comes amid sustained pressure from Washington, which has been pushing multiple countries to sign what GTRI refers to as MASALA deals — Mutually Agreed Settlements Achieved through Leveraged Arm-twisting.
These one-sided arrangements typically require countries to reduce tariffs without equivalent concessions from the US, commit to fixed purchases of American goods, and still allow Washington the leeway to impose additional tariffs later.
So far, only the United Kingdom and Vietnam have agreed to such terms, while major economies such as Japan, South Korea, the European Union, and Australia have resisted. “Trump’s aggressive trade threats are losing credibility,” the report noted.
In response to limited progress, the Trump administration has adopted punitive measures. On July 7, it imposed 25 per cent tariffs on imports from Japan and South Korea. Just days later, on July 12, it threatened 30 per cent tariffs on EU and Mexican products — even as negotiations with those countries continue.
India, the report emphasised, is not alone. The United States is currently in trade negotiations with more than 20 countries and is seeking concessions from over 90. However, most nations are pushing back, recognising that these politically driven deals offer little long-term certainty or fairness in international trade.
The GTRI urged India to maintain a cautious stance and prioritise strategic sectors. “Agreements must be reciprocal, stable, and protect India’s policy autonomy,” the report concluded.
Notably, last week, US President Donald Trump said that the US is close to reaching a trade deal with India. His remarks came even as he announced tariffs on 14 nations.