Something similar with India, says Donald Trump after trade deal with Indonesia sealed
'Indonesia was great. He (Prabowo Subianto) is a great President and we made a terrific deal where they opened up the entire country to trade with the United States. We weren't allowed to go in and trade. I think something similar will happen, I would say, with India,' Trump told reporters on Tuesday.
Trump announced that under the Indonesia agreement, Indonesian goods would face a 19% tariff when exported to the United States, while US exports would face no tariffs entering the Indonesian market — an asymmetric arrangement favouring American exporters.
'As part of the Agreement, Indonesia has committed to purchasing $15 Billion Dollars in US Energy, $4.5 Billion Dollars in American Agricultural Products, and 50 Boeing Jets, many of them 777's,' Trump wrote on his social media platform Truth Social.
Indonesia initially received a tariff letter stating that the country's goods would face a 32% American tariff starting on August 1 if an agreement was not reached, before concluding the deal that reduced this to 19%.
The reference to an Indonesia-style deal comes as New Delhi and Washington remain engaged in intensive trade negotiations. An early harvest deal covering goods is currently awaiting political approval from President Trump, with increased access for American agricultural goods and automobiles into the Indian market remaining key sticking points.
India has been notably absent from the tariff ultimatum letters sent by the Trump administration over the past weeks, suggesting continued diplomatic engagement despite the approaching August 1 deadline for additional tariffs.
An Indian trade team led by chief negotiator for the deal Rajesh Agrawal is due to hold meetings with American counterparts this week.
Should India and the United States fail to reach a deal, an additional 16% reciprocal tariff will be imposed on Indian goods starting August 1, adding to the 10% baseline tariff already being levied.
Former US trade negotiator Mark Linscott suggested the negotiations have reached unprecedented depths despite Trump's unpredictable approach. 'It's almost impossible to assess the thinking of the President. He clearly engages in complicated calculus of what is beneficial for the United States, what's beneficial for the administration, what's beneficial for him in terms of winning in a negotiation. What I can provide is my own assessment which is that I don't think that the United States and India have ever gone so far in trade negotiations,' Linscott said in an interview to HT earlier this month.
When asked about the possibility of a US-India deal falling through, Linscott expressed hope that negotiations would succeed. 'It's a possibility. I hope it's not the case. I think it would be a mistake. I think what seems to have been negotiated already is clearly in US interests. I can't say definitively that it won't happen, but I certainly hope that it doesn't happen.'
President Trump's threats to place tariffs on Brics nations, including India, have added complexity to the bilateral negotiations. Additionally, America's proposed Russia sanctions bill could impose a 500% tariff on countries that purchase Russian energy, including India.
Trump said he would 'strongly consider' the Russia sanctions bill, which is currently making its way through the United States Senate, potentially creating another layer of trade complications for India.
The potential Indonesia-style deal would operate within the broader framework established during Prime Minister Modi's February visit to America, when India and the United States announced they would work to raise bilateral trade to $500 billion by 2030 under the 'Mission 500' initiative.
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