Trump insulting India publicly...Modi government should withdraw from all negotiations with US: GTRI

New Delhi: India should withdraw from all negotiations with the US and prepare to engage with the Trump administration in the same way as countries like China and Canada are doing, economic think tank GTRI said on Saturday.

The Global Trade Research Initiative (GTRI) Founder, Ajay Srivastava said the US is exerting heavy pressure on India to accept trade demands that largely favour American interests.

US President Donald Trump and his officials have criticized India mostly by using incorrect data, he said.

"Trump is insulting India publicly using wrong data. No balanced outcome is possible in such circumstances. India should withdraw from all negotiations and prepare to deal with them like other countries are doing," Srivastava said.

Against US tariffs, China and Canada have announced retaliatory measures.

On Friday, Trump claimed that India had agreed to cut tariffs on American imports after his administration "exposed" what he called unfair trade practices.

"This is patently incorrect and intended to pressurise India. India's silence is baffling and India needs to counter with facts. Whole world is watching as Trump and his officials belittle India every day," he added.

US Commerce Secretary Howard Lutnick has also said that India needs to open its agriculture market, emphasising that it can not be 'off the table' when the country is negotiating with its largest trading partner. He has pitched for a macro, large and grand trade agreement with India, and not 'product-by-product' arrangement to promote bilateral trade.

According to a GTRI report, a comprehensive trade deal would open the door to US demands, not just on tariff reductions, but also on government procurement, agricultural subsidies, patent laws, and unrestricted data flows, all of which India has consistently opposed.

"Second, Trump's history of disregarding negotiated trade agreements is evident from his decision to scrap the US-Mexico-Canada FTA, which he himself finalized in 2019, and his imposition of 25 per cent tariffs on Canadian and Mexican imports now," it said.

It suggested India consider a macro-level reciprocal tariff arrangement covering over 90 per cent of industrial goods under a "Zero-for-Zero" approach, where India eliminates tariffs only if the US does the same.

"However, agriculture, passenger cars, and other sensitive sectors must remain excluded," it said adding India must avoid making the same mistake as the auto sector contributes to one third of manufacturing GDP.

Citing an example, it said Australia's domestic car industry collapsed after it reduced car import tariffs from 45 per cent to 5 per cent in the late 1980s.

India exported less than $13 million worth of passenger cars to the US and if America increases tariffs on India cars, India will have no impact, it said.

On opening the agri sector, Srivastava, who has earlier served in the department of commerce, strongly opposed this demand asserting that India's agriculture sector supports over 700 million people, compared to less than 7 million in the US, making it a livelihood issue rather than just a trade concern.

"Opening even a few agricultural products to US imports could set a dangerous precedent, leading to increased pressure for further concessions," he said, adding tariffs on top US agricultural exports to India are already low.

For instance, the import tariff on almonds is Rs 35 per kg, translating to just 5 per cent at the current import price of Rs 700/kg. Pistachios face a 10 per cent tariff, and ethyl alcohol only 5 per cent.

"With India's total agriculture, dairy, and marine exports to the US amounting to just $5 billion, retaliatory US tariffs would not significantly harm India. If India concedes today, more products will be added to the US list in the future," he cautioned.

On the US allegations that India is a tariff king, he said while New Delhi does have high tariffs on specific items, such as 150 per cent on wines and alcohol and 100 per cent on cars, the US itself imposes 350 per cent tariffs on tobacco.

In terms of overall trade, the weighted tariff rates for US goods entering India are only 4.9 per cent higher than what the US applies to Indian products, he added.

Further he said that US officials frequently misrepresent trade figures.

For example, Trump claimed that the US trade deficit with India is $100 billion, whereas India's official data places it under $45 billion, he added.

"Similarly, the White House fact sheet inaccurately stated that India imposes a 100 per cent tariff on Harley-Davidson motorcycles, when the actual tariff was reduced from 50 per cent to 30 per cent on February 1. It is painful, despite repeated provocations from the US, Indian Government or any industry association has not countered such misinformation," Srivastava said.

He added that at a time when many nations are standing up to Trump's trade policies, India must do the same, focusing on long-term economic resilience rather than short-term appeasement.

If the US rejects 'Zero-for-Zero' offer and imposes reciprocal tariffs, India should respond only if necessary, as trade data suggests that accurately calculated reciprocal tariffs will not hurt most industry sectors, he said.