NEW DELHI: During an interaction with members of the Parliamentary Standing Committee on External Affairs on Monday, the Centre made it clear that certain red lines “cannot be crossed” in ongoing trade negotiations with the United States. Senior officials, including Foreign Secretary Vikram Misri and Commerce Secretary Sunil Barthwal, briefed the panel amid growing uncertainty over the next round of talks, scheduled to begin in New Delhi from August 25.
The assertion came as India faces the impact of sweeping new US tariffs imposed by President Donald Trump, who has announced there will be no further trade talks until the tariff dispute is resolved. According to sources present at the briefing, the government emphasised its uncompromising stance on core sectors, especially agriculture and dairy, while outlining a strategy to cushion the economic blow through export diversification.
“Red lines were clearly flagged,” a source said, “particularly against the US demand to open India’s agri and dairy sectors. There will be no compromise on these.”
Describing the current phase of trade relations as “difficult,” officials said India is intensifying efforts to leverage existing free trade agreements and accelerate new ones with key partners like the UK and the European Free Trade Association (EFTA), alongside ongoing negotiations with the EU.
The US has imposed a 25% tariff on most Indian exports -- excluding electronics, semiconductors, and energy products -- effective August 7, with an additional 25 per cent penalty set to take effect from August 27, citing India's continued purchase of Russian oil. Sectors such as auto parts, textiles, leather, and gems and jewellery are expected to be most affected, according to those who were present in the briefing.
Officials told the committee that the government’s focus now includes expanding trade with partners like the UAE, Australia, Japan, ASEAN countries, and Mauritius, while speeding up negotiations with Europe.
Despite the trade turbulence, the government underscored that India-US ties remain fundamentally strategic. “Our relationship with the US should not be viewed solely through the current trade lens. It is enduring, bipartisan, and rooted in shared democratic values,” officials said.
Members of the committee, chaired by Congress MP Shashi Tharoor, also questioned the government on broader developments affecting bilateral ties including the US hosting of Pakistan Army Chief Asim Munir and Trump’s continued criticism of India’s trade policy. Opposition MPs reportedly asked whether India’s rejection of Trump’s earlier “ceasefire” claims between India and Pakistan contributed to the tensions.
Foreign Secretary Misri reiterated that India would not tolerate “nuclear blackmail” — a reference to Munir’s recent threats reportedly made on US soil. “It was not good that Munir used the soil of a friendly country to make such a statement, and this message will be conveyed,” he said.
Amid the diplomatic strain, the US has taken some steps aligning with India’s security concerns. Officials told the committee that Washington recently designated The Resistance Front -- a Lashkar-e-Taiba proxy linked to the Pahalgam terror attack -- as a terrorist organisation, and extradited Tahawwur Hussain Rana, a key accused in the 2008 Mumbai attacks. The government assured the committee that all necessary steps are being taken to safeguard national interests. “We are committed to protecting farmers, exporters, MSMEs and entrepreneurs,” an official said. “Our approach will remain focused, strategic and uncompromising on India’s core economic interests.”