India has decided to delay its upcoming trade delegation visit to Washington, D.C., where officials were expected to advance discussions on an interim trade agreement with the United States. According to a person familiar with the matter, the decision reflects the rapidly shifting trade environment in the U.S.
The postponement comes in the wake of a major legal and policy shake-up in Washington. The U.S. Supreme Court recently ruled that tariffs introduced by former U.S. President Donald Trump were unlawful. Shortly afterward, Trump invoked Section 122 of the Trade Act of 1974 to impose a 10% blanket import tariff, which was quickly raised to 15%.
Against this backdrop, India postpones Washington trade trip amid changing U.S. tariff policies, a source tells CNBC, signaling a cautious approach as both nations reassess their positions.
A Pause for Strategic Review
The planned in-person meeting will now take place at a later date that suits both sides, the source said on Sunday. Officials from India and the U.S. believe that the visit should be rescheduled only after each government has had sufficient time to evaluate the latest developments and understand their broader implications.
CNBC has contacted India’s Ministry of Commerce and Industry for official comment, but no response has been issued yet.
India’s chief trade negotiator, Darpan Jain, along with his team, had been scheduled to begin a three-day round of talks in Washington later this week. These discussions were expected to help shape the legal framework of the interim agreement currently under negotiation.
Tariff Changes Complicate Interim Deal
At present, India is subject to a 25% reciprocal tariff imposed by the United States. Under an earlier understanding reached this month, that rate was set to be reduced to 18%, with the possibility of adjustments depending on future policy shifts.
A joint statement released by both countries on February 6 had clearly outlined flexibility in the agreement. It stated that if either country altered its agreed tariff commitments, the other would retain the right to revise its own obligations accordingly.
However, the recent U.S. tariff adjustments have disrupted the foundation on which the interim deal was built. Analysts now suggest that India—like several other trading partners—may face a 15% base tariff in addition to existing most-favored-nation (MFN) rates, which generally hover between 2% and 3%.
Ajay Srivastava, founder of the Global Trade Research Initiative and a former Indian trade negotiator, noted that the earlier 18% tariff discussions were based on certain expected concessions. With those benefits no longer guaranteed, both nations may need to recalibrate their strategy.
Virtual Talks Continue Amid Uncertainty
Following the February 6 announcement, officials from both sides continued negotiations through virtual meetings, according to local media reports. The in-person meetings that were scheduled for this week were expected to serve as a stepping stone toward finalizing the agreement’s legal language.
The talks were to involve representatives from the Office of the U.S. Trade Representative, led by Ambassador Jamieson Greer. These sessions were viewed as critical in converting the broad framework of the interim deal into a formal, enforceable document.
India’s Commerce Minister, Piyush Goyal, had expressed optimism just days earlier, stating that the interim trade agreement was likely to be signed in March and implemented in April. However, the evolving tariff landscape has introduced fresh uncertainty into that timeline.
Rethinking the Road Ahead
The sudden policy shifts in Washington have altered the premise of earlier negotiations. As Srivastava pointed out, the original discussions were built on a specific understanding of mutual benefits that now appear uncertain.
With the U.S. government grappling with legal, political, and economic pressures at home, trade policy recalibrations could take time. In the meantime, India is choosing to pause rather than proceed under unclear terms.
For now, the postponement signals prudence rather than breakdown. Both sides appear committed to dialogue—but only after gaining clarity on the new tariff framework and its long-term implications.
As global trade dynamics continue to evolve, the recalibration of U.S.–India economic ties could set the tone for broader international negotiations in the months ahead.
