INDIA ''WALKED AWAY'' FROM US TRADE

          

 Key Update: India "Walked Away" from Trade Talks

                On **August 30, 2025**, **former Finance Secretary Subhash Garg** publicly stated that India has **“effectively walked away”** from trade talks with the United States due to **unilateral U.S. tariffs of up to 50%** imposed under President Trump. Garg emphasized that such tariff levels make meaningful trade negotiations unfeasible, though he cautioned against formally closing the door to future dialogue, hoping "sanity prevails" eventually.([www.ndtv.com][1], [ABP Live][2])

NEWSBURNER360

* This comment came in response to **U.S. Treasury Secretary Scott Bessent’s remarks** expressing frustration that the trade deal had not materialized by mid-2025 and describing India’s negotiating posture as “performative.” Bessent acknowledged that while a deal had been expected in May or June, it did not occur.([www.ndtv.com][3], [ABP Live][2], [Indiatimes][4], [Reuters][5])

* Despite this, **informal channels remain open**, with continued engagement on defense, foreign policy, and strategic issues, even though formal trade talks are currently stalled.([ABP Live][2]

      Context: Why Talks Fell Apart

NEWSBURNER360

* Earlier in **2025**, India and the U.S. had negotiated multiple rounds aiming for a **“Mission 500”** target—boosting bilateral trade to \$500 billion by 2030. But despite promising talks, no deal materialized.([Wikipedia][6], [Reuters][5])

* The U.S. responded by imposing escalating tariffs on Indian goods—**25% reciprocal tariffs** and an additional **25% penalty** tied to India’s continued purchases of **Russian oil**, resulting in a **total 50% duty**.([Financial Times][7], [The Times][8], [Wikipedia][9], [Indiatimes][4])

* These tariffs primarily affect industries like **textiles, gems, leather, shrimp, and automobiles**, while sectors such as pharmaceuticals and electronics were largely exempt.([AP News][10], [Indiatimes][4], [Financial Times][7], [Wikipedia][9])

NEWSBURNER360

          Diplomatic Fallout & Strategic Implications

              * The tariffs and collapse in trade talks have been described by experts as one of the **worst crises** in **two decades of U.S.–India relations**, raising concerns about long-term trust and strategic alignment.([Wikipedia][9], [Reuters][5], [Financial Times][11])

* Prominent economists, such as **Raghuram Rajan**, likened the situation to negotiating “**with a gun to your head**,” warning the coercive approach undermines fair agreements and ultimately harms both sides.([The Economic Times][12])

* Analysts also warn that such tariff-based pressure could nudge India closer to **Russia and China**, potentially weakening the **Quad** and regional strategic cooperation.([The Economic Times][13], [Wikipedia][9], [Financial Times][11])