Trump Optimistic on India Trade Deal, Calls PM Modi a Good Friend

US President Donald Trump expressed optimism about reaching a trade agreement with India, emphasising his strong relationship with Prime Minister Narendra Modi. Speaking to reporters at the Oval Office on Thursday, Trump confirmed the ongoing bilateral efforts.

"We will get to a deal because I like your prime minister a lot. He is a good friend of mine. We get along great, and we are gonna make a deal," Trump told reporters.

A US delegation in India concluded four days of negotiations on an interim bilateral agreement on Thursday. India's commerce ministry said the trade talks were marked by a spirit of cooperation and pragmatism, with both sides reaffirming their commitment to concluding a mutually beneficial agreement that strengthens bilateral trade and economic ties. 

The United States and India are re-negotiating the trade deal in the wake of a recent US Supreme Court order affecting tariffs. The discussions will further address historical trade imbalances and the immediate impacts of recent judicial rulings on American trade policy.

Harley-Davidson Tariff Dispute

Despite his optimism, Trump voiced specific grievances regarding historical Indian tariffs levied on American companies. Responding to a question on the trade deal being negotiated between the two countries, Trump said India had taken advantage of US policies for years and charged tremendous tariffs.

"They charged tremendous amounts of tariffs to our companies, and we didn't charge them anything," Trump said.

The US president highlighted the challenges faced by an iconic American manufacturer to illustrate his point.

"In the past, they wouldn't let Harley-Davidson sell its motorcycles. They charged a 200 per cent tariff, so Harley-Davidson was precluded. They ended up going to India and building their own plants, which is unfortunate that that happened, but it happens. It was before me," Trump said.

He contrasted India's past protectionist measures with the open access granted to foreign brands in the United States.

"They sold motorbikes here, too. You know (how much) we charged them? Nothing. And now it's the exact reverse. We're making a lot of money with India," Trump said.

Supreme Court Ruling Impact

The ongoing negotiations follow a February 7 phone call between Trump and Modi. Following the call, the two nations issued a joint statement finalising the framework for the first phase of a Bilateral Trade Agreement (BTA), or interim trade deal.

Under that initial framework, the US agreed to reduce tariffs on India to 18 per cent from 50 per cent. The United States also removed 25 per cent tariffs on Indian goods for buying Russian oil and was set to cut the remaining 25 per cent to 18 per cent under the pact.

However, the trade landscape shifted dramatically on February 20. The US Supreme Court ruled against Trump's sweeping reciprocal tariffs, which his administration had imposed under the 1977 International Emergency Economic Powers Act (IEEPA).

Following the judicial setback, Trump announced the imposition of 10 per cent tariffs on all countries for 150 days, starting February 24. This action forced negotiators back to the table to reshape the bilateral trade agreement.