India and US hold day-long talks in bid to revive stalled trade deal

India and the United States held a day of trade talks in New Delhi on Tuesday as both sides sought a breakthrough in negotiations that collapsed after Washington imposed steep tariffs on Indian goods.

A team led by US trade negotiator Brendan Lynch met officials from India’s commerce ministry in what New Delhi described as a "discussion" aimed at "trying to see" how an agreement could be reached, rather than the start of a formal new round of talks, Rajesh Agrawal, who is leading the Indian side, told local media.

Negotiations between the world’s two largest democracies were suspended last month after President Donald Trump announced a 50% tariff on a wide range of Indian products. Washington framed the duties in part as a penalty for New Delhi’s continued purchases of Russian oil and weapons; India has defended those purchases as necessary to meet domestic energy needs and called the tariffs "unfair." The tariffs have added pressure on exporters of garments, seafood and gems and jewellery, and Indian manufacturers and workers have reported immediate economic strain.

Officials and analysts cautioned that the talks on Tuesday were exploratory. A formal round of negotiations had been called off when the tariffs were announced, and key policy differences remain. Agriculture and dairy market access are major sticking points, with the United States seeking greater entry to India’s farm sector and New Delhi citing food security, rural livelihoods and the interests of millions of small farmers in maintaining protections.

The US delegation’s visit followed a string of mixed signals from Washington. Peter Navarro, a top trade adviser who has been one of the most vocal critics of India’s stance on Russia, told CNBC in recent days that "India is coming to the table." Sergio Gor, President Trump’s nominee to be ambassador to India, told a Senate confirmation hearing that negotiators were "not that far apart" and predicted a resolution "in the next weeks." At the same time, US Commerce Secretary Howard Lutnick reiterated pressure on Indian safeguards and questioned why India would not buy more US agricultural products, comments that underscore the tensions over market access.

Indian officials say domestic considerations will constrain how far they can bend on agriculture and other sensitive sectors. Analysts note that Delhi’s insistence on protecting smallholders has broad political support and is central to its argument that trade liberalisation must preserve food security and rural incomes.

The talks come amid broader strains in bilateral relations that followed strong public criticism by some Trump administration officials. Indian exporters and business groups have urged a quick resolution, warning that prolonged tariffs could further disrupt supply chains and livelihoods across sectors that depend on access to the US market.

Both governments framed the Delhi meeting as a step toward resuming negotiations rather than a concluded agreement. Officials said further discussions would depend on outcomes from the day’s meetings and follow-up contacts in the coming weeks. Observers said the direction of the talks will be watched closely by exporters, farmers and political leaders in both countries, given the economic and diplomatic stakes involved.