Dialogue and deadlines in Washington
The India-US trade talks in Washington have been ongoing for months, with negotiators working to bridge key differences. Despite intensive rounds of discussions, contentious issues, especially around US access to India’s agriculture and dairy sectors, remain unresolved. The latest round ended just before the July 9 deadline, with Commerce Minister Piyush Goyal reiterating that India will not negotiate a deal under pressure of a deadline. This firm stance by India signals not only a resistance to externally imposed deadlines but also a desire to avoid domestic political backlash, particularly from farmers and small dairy producers, who are a sensitive voter base.
For the US, however, quick trade wins are a political imperative. President Donald Trump, who has made aggressive trade renegotiation a cornerstone of his administration, is under pressure to showcase success stories ahead of key electoral milestones. The India deal, one of the few still in the pipeline, is thus a prize that Washington wants to secure quickly.
But there is fundamental mismatch. India seeks a comprehensive and fair agreement that protects its domestic sectors, while the US pushes for immediate market access and tariff concessions. This mismatch in goals ensures that progress remains incremental at best, even as both sides reiterate their commitment to a stronger bilateral relationship.
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Wranglings in Geneva
Meanwhile, at the WTO, the same two countries are engaged in procedural warfare. The US has challenged India’s veterinary certificate requirements for dairy imports, calling them “unnecessary trade barriers”. India, however, defends these norms as essential for ensuring food safety and public health, particularly since many Indian consumers are religiously averse to products derived from animals not raised according to specific dietary standards. India requires a comprehensive veterinary health certificate for milk and milk product imports, which must verify the absence of drugs, antibiotics, pesticides and heavy metal residues.Simultaneously, India is using the WTO platform to assert its rights under the global trading system. After the US imposed steep tariffs — first 25% and later 50% — on steel, aluminium and derivative imports, India responded by proposing retaliatory tariffs. Initially proposed in May, these retaliatory measures might now being revised upwards just as the US did.India has also officially reserved its right to impose retaliatory duties on the US for placing a 25 per cent tariff on imports of Indian auto parts. Last week, India proposed the move under WTO rules, treating the US tariff action as a “safeguard measure”. A notification stated that India could raise tariffs on selected American goods in response.
This duelling at the WTO is not just a legal exercise but a strategic counterweight to the bilateral negotiations. By leveraging its rights at the WTO, India signals to the US that unilateral tariff hikes will not go unchallenged. It also uses the multilateral platform to build pressure and demonstrate that it is not a passive participant in global trade, but a country willing to push back when its interests are threatened.
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Why this two-track strategy?
Why are India and the US taking such a paradoxical approach of negotiation in Washington and confrontation in Geneva? Bilateral negotiations are political and flexible, often shaped by top-level diplomacy. WTO proceedings, on the other hand, are legalistic and rules-based. Each forum offers different tools. India uses Washington for political bargaining, and Geneva for legal assertion. By objecting to India’s dairy import certificates at the WTO, the US has responded in kind to India’s strategy of taking Trump’s tariffs on auto parts and steel and aluminium to the WTO even while trade deal negotiations are on.
In both countries, trade policy is tightly linked to domestic constituencies. While Trump appeals to protectionist sentiments, India must protect its agricultural and dairy sectors, where millions of livelihoods are involved. Leaders on both sides have limited room for compromise on politically sensitive issues, especially close to elections.
India’s WTO assertiveness sends a message to the US and other global powers that it won’t be coerced into deals that hurt its long-term interests. The use of retaliatory tariffs is a signal of strength, not aggression. It aims to balance the power asymmetry in the bilateral talks. By pursuing action at the WTO, India is keeping its legal options open. Even if negotiations fail or are delayed, the WTO actions continue independently. This prevents India from being diplomatically cornered.
India and the US are engaged in a sophisticated game of trade diplomacy. Far from being contradictory, this strategy reflects the evolving maturity of India’s trade policy of using all available platforms. While a breakthrough in the bilateral deal remains uncertain, what is certain is that India is no longer playing defense in global trade. It is negotiating but also asserting. The Washington-Geneva duality is not a contradiction but a calculated strategy.
