U.S. trade deal: India targetting July 8 deadline but can extend to August 1 if deal specifics don’t suit

India expects to announce a ‘mini’ trade deal with the United States “in a day or two”, government officials said on Tuesday (July 8, 2025), though U.S. President Donald Trump has now extended his tariff pause until August 1. They cautioned, however, that India will not push ahead if the deal specifics do not suit Indian interests.

This came hours after U.S. President Donald Trump also said that the U.S. was “close to making a deal with India”.

Mr. Trump has also sent letters to 14 countries, threatening higher tariffs from August 1, in a bid to address their trade deficits with the U.S. They include Japan, South Korea, Kazakhstan, Malaysia, Tunisia, South Africa, Bosnia and Herzegovina, Indonesia, Bangladesh, Serbia, Cambodia, Thailand, Laos, and Myanmar.

The Liberation Day tariffs — announced on April 2 and originally paused till midnight on July 8 — applied to almost all countries, and included a 26% tariff on Indian imports.

“The August 1 deadline is for countries that have been sent the letters,” an official told The Hindu. “India has not been sent a letter, and we are still working to finalise the deal, so the July 8-9 deadline is still what we are operating under.”

New deadline

However, as per an executive order signed by Mr. Trump in Washington on Monday (July 7, 2025), “based on additional information and recommendations from various senior officials, including information on the status of discussions with trading partners”, the suspension of higher tariffs will now extend until 12:01 a.m. on August 1, by U.S. Eastern Daylight time.

Another official aware of the negotiations said a deal could materialise by the night of July 8, or “in a day or two”. However, this official added that India could use the expanded August 1 window “if the deal specifics do not suit us”.

On Monday (July 7, 2025), Mr. Trump said that the U.S. had “spoken to everybody”. “We have made some [trade] deals, but for the most part we are going to send a letter,” he said. “We’ve made a deal with the United Kingdom, we’ve made a deal with China, we are close to making a deal with India. Others we met with and we don’t think we are going to be able to make a deal, so we just sent them a letter.”

Deal dynamics

A team of Indian negotiators led by Special Secretary in the Ministry of Commerce and Industry Rajesh Agrawal returned from the U.S. last week, following their second trip there. A team from the U.S. has also visited India twice in the last few months. 

According to sources, India has placed its final proposals before the U.S. and now the U.S. has to decide whether to accept the deal or not. India, for its part, will not further amend its proposals for the mini deal.

As The Hindu has reported before, the main issues holding up a deal between India and the U.S. continue to be genetically modified (GM) crops and dairy.

The US is pushing India to allow the import of GM products such as soybean meal and distillers dried grains with solubles (DDGS) for animal feed. DDGS is a by-product made during ethanol production. India has not been inclined towards GM crops even produced domestically, let alone imported.

Another demand is for India to allow the import of cow milk from the U.S., which India has been resisting.