India-US trade talks: SBI backs patience as tariff hits 18%

Why the negotiating stance is in focus

India’s trade negotiations with the United States are being watched closely because they combine tariffs, market access, and strategic considerations. The latest SBI Research report argues India should avoid making early concessions and instead remain patient as Washington’s bargaining position evolves. The report frames US negotiating behaviour as a strategy built around uncertainty and ambiguity, used as leverage across multiple policy fronts. In parallel, separate reporting from Reuters and the BBC points to postponed discussions and a possible delay in signing, adding another layer of uncertainty to the timeline.

SBI Research: “Wear down the opening position”

SBI Research’s central recommendation is to hold the line on India’s negotiating position without damaging the underlying bilateral relationship. It advises keeping the conversation warm, avoiding public escalation, and making limited and reversible offers. The report suggests India should wait for the US administration’s initial demands to run into constraints such as US market costs, China-balancing needs, and alliance fatigue. It also encourages India to “test the resolve” of the US administration, even if that leads to higher short-term costs, on the grounds that it can improve India’s bargaining position over time.

How SBI describes the US playbook

According to the report, the US administration has increasingly adopted a negotiation strategy built around uncertainty. It says ambiguity is being used as leverage across issues ranging from tariffs and Nato to Iran, China, Greenland and India. SBI Research acknowledges this approach can deliver short-term gains for Washington, including increased defence commitments from allies and enhanced negotiating leverage. But it warns of longer-term consequences, arguing repeated use of uncertainty can cause allies, rivals, and markets to discount future US signals. In SBI’s formulation, “The short-run payoff is leverage. The long-run cost is trust depreciation.”

Reuters: sources point to a delay in signing

Reuters, citing four Indian sources, reported that India is expected to postpone signing a trade agreement with the US for a few months. The report said the schedule could extend by several months, though US officials were described as confident India would fulfil its commitments. One source told Reuters, “We are not rushing to finalize any agreements.” Reuters also cited an unnamed source describing new investigations as a pressure tool, calling them an obstacle in the process. The same reporting said India is likely to take a “wait and see” approach as US tariff policies evolve.

India’s trade ministry disputes “delay” claims

Against the reports of postponement, a representative from India’s trade ministry rejected claims of any delay in bilateral discussions, while still signalling talks are ongoing. The representative said the sides remain focused on a mutually beneficial trade agreement, without sharing specifics about the formal signing process. This contrast highlights that while negotiations may continue, the timing and sequencing of formal steps remains contested in public messaging.

BBC: talks postponed after US Supreme Court tariff decision

The BBC cited an official from India’s commerce ministry saying trade discussions between India and the US have been postponed, originally scheduled for “this week,” as both sides evaluate the implications of a US Supreme Court decision to annul global tariffs established by the Donald Trump administration. According to the BBC, the official said discussions were postponed until the implications of recent developments could be assessed. Reuters was also cited as reporting no new date had been set for a delegation visit that had been scheduled to depart on Sunday.

India’s red lines: agriculture, farmers, and sensitive imports

India’s commerce minister, Piyush Goyal, has said concessions were not made on dairy, genetically modified products, meat, or poultry, and that protections for farmers are in place. Other commentary in the provided material notes India has been reluctant to grant greater market access for US agricultural products, similar to Japan, to protect local farmers who are a significant voting demographic. The same context also highlights that trade talks are not only about tariffs, but about market access, geopolitics, national interest, and strategic autonomy.

February joint statement: tariffs reduced to 18% with conditions

A joint statement dated 6 February said the Trump administration had reached an agreement to lower tariffs on India. It said the reciprocal tariff on India was reduced from 25% to 18%, and an additional 25% tariff linked to India’s purchase of Russian crude was removed. In exchange, India would commit to buying $100 billion worth of US products over five years and stop buying Russian oil. The material also states this reduces the US tariff level on India from 50% to levels broadly in line with other countries in South and Southeast Asia. It adds that negotiations remain a work in progress, moving from a joint statement to an interim agreement in March and then to a bilateral trade agreement, reflecting India’s preference for a phased process.

Domestic politics: farmer protests and opposition criticism

The provided text links the proposed scale of purchases and market access debates to domestic pushback. It says farmers are planning a strike on Thursday, concerned that increased US imports could hurt livelihoods. It also reports opposition criticism describing the deal as a “wholesale surrender” of national interests, with concerns spanning essential markets and digital trade regulation. Separately, the material notes the Indian government argues market access excludes staples like wheat and rice, but this has not prevented renewed farmer protests and criticism.

India’s broader trade strategy beyond the US

The context also points to India pursuing multiple trade tracks to diversify export markets and avoid dependence on any one partner. It says India concluded three trade negotiations in 2025 with Oman, New Zealand and the United Kingdom, followed by a deal with the European Union in January this year. It adds India has revived negotiations with Canada, Israel, Qatar, and Peru. A Quincy Institute analyst, Sarang Shidore, was cited as describing this as a shift toward a “multi-alignment strategy,” while maintaining a strong connection with Washington as a primary global partner.

Key facts at a glance

Market and policy impact: what is clearly established

The most concrete market-relevant details in the material are the tariff levels and the scale of the proposed purchase commitment. A reduction to an 18% reciprocal tariff is positioned as bringing India closer to the tariff levels faced by competitors in South and Southeast Asia, while the conditions attached broaden the policy implications. The reported postponement of discussions and the need to assess the US Supreme Court decision introduce procedural uncertainty, even as officials on both sides signal continued engagement. For India, the repeated emphasis on protecting farmers and sensitive sectors underscores that market access issues, not only headline tariffs, are central to the negotiation.

Why SBI’s “patience” argument matters

SBI Research’s analysis matters because it treats negotiating leverage as dynamic, shaped by costs that emerge after initial demands meet domestic constraints. Its warning that repeated uncertainty can depreciate trust is aimed at the negotiating environment itself, not only a single tariff line. In this framing, India’s objective is to preserve the relationship while resisting pressure for quick, binding concessions. The surrounding reporting about delays, court-driven reassessments, and domestic red lines suggests a policy setting where sequencing and reversibility can become negotiating tools.

What to watch next

Based on the material provided, the next milestones revolve around the timing of resumed discussions and the stated phased path that includes an interim agreement in March followed by a bilateral agreement. Separately, domestic reactions such as planned farmer action and political criticism are likely to remain part of the backdrop as negotiators address market access. The official line from India’s side emphasises that talks continue, while Reuters sources suggest India is not rushing to formalise an agreement and may wait as US tariff policy evolves.