Web Desk (MNN); India’s proposed trade agreement with the United States was delayed after Prime Minister Narendra Modi did not place a telephone call to US President Donald Trump to finalise negotiations, according to US Commerce Secretary Howard Lutnick.
Speaking on Friday, Lutnick said trade talks between the two countries collapsed last year, prompting President Trump to double tariffs on Indian exports in August to 50 per cent — the highest rate imposed on any country. The hike included a 25 per cent levy introduced in response to India’s continued purchases of Russian oil.
In an interview on the All-In podcast, Lutnick said the framework of the deal was ready, but required direct engagement at the leadership level. “Everything was set up, and Modi needed to call the president. They were uncomfortable doing that, so the call never happened,” he said.
His remarks followed renewed pressure from Trump this week, who warned that tariffs on Indian goods could be increased further unless New Delhi reduces its imports of Russian oil.
The warning unsettled markets, pushing the Indian rupee to a record low and raising concerns among investors awaiting progress on a long-pending trade agreement.
Lutnick added that India was seeking tariff terms somewhere between those earlier offered to Britain and Vietnam, but noted that the previous offer had since lapsed.
India’s commerce ministry did not immediately respond to a request for comment. However, Reuters reported that New Delhi and Washington were close to finalising a deal last year before a breakdown in communication derailed the talks. An Indian official familiar with the negotiations said Modi avoided calling Trump due to concerns that a one-sided conversation could place him in a difficult position.
‘Remarks not accurate’
India later rejected Lutnick’s claims, saying they did not accurately reflect the state of discussions between the two sides.
According to the BBC, Foreign Office spokesperson Randhir Jaiswal said India and the United States had committed to negotiating a bilateral trade agreement as early as February 13 last year, with several rounds of talks held since then.
“On multiple occasions, we were close to reaching a balanced and mutually beneficial agreement,” Jaiswal said, adding that Prime Minister Modi had spoken with President Trump eight times by phone during 2025 on various aspects of bilateral cooperation.
