The India-US trade deal has been dragging on for months, and now Finance Minister Nirmala Sitharaman has come right out and said what a lot of people were already sensing. The talks have hit a plateau. Beyond this point, any more give-and-take is going to be very, very difficult.
She said this on Monday while speaking at the Munich Leaders Meeting in New Delhi. Her exact words were pretty clear: the negotiations are still going on, it’s been a hard and rigorously negotiated agreement, but both sides have reached a stage where giving or taking more might not be easy. If there’s any room left to manoeuvre, maybe they can still find a way. But the sense you get is that the easy compromises are done.
This comes just days after US Trade Representative Jamieson Greer met Commerce Minister Piyush Goyal on the sidelines of the G20 Trade Ministers’ Meeting in Milwaukee. Greer said the deal was in the “short strokes” but not imminent. They’ve identified the universe of sticking points, he said, and staff are still working on them. No sudden breakthrough.
What’s really at the heart of this? The trade balance. Sitharaman pointed out that the predominant feature of India-US trade is that the balance is very much in India’s favour. The deficit sits on the American side. Naturally, Washington wants to reduce that imbalance and, from their point of view, make up for what they feel they’ve lost over the years. That’s the lens they’re looking through.
She also made a broader point that’s worth sitting with. Negotiation used to be the only proper platform for countries to talk about discrepancies and lopsidedness. Tariff was an instrument within a clear framework. Now tariffs have been weaponised. Countries are using them in ways that go beyond traditional bargaining. India still believes you have to talk things out and find some give and take. She even drew a comparison with China. India’s trade imbalance with China has grown exponentially since 2014. If the principle is simply “reduce the deficit by any means,” India could take the same hard line. But it doesn’t. It negotiates. That’s the difference she’s highlighting.
There’s extra pressure in the background too. President Trump signed the Lindsey O. Graham Sanctioning Russia and Iran Act of 2026, which gives him authority to slap tariffs of up to 100 percent on countries that keep buying Russian oil and gas. India is one of those countries. That law has added a fresh layer of complication to the whole relationship. Sitharaman did note, by the way, that there’s no equivalent “Lindsey Graham bill” hanging over the India-EU talks. The European free trade agreement is moving ahead and is expected to be signed later this year. Russian oil purchases haven’t become a make-or-break issue there the way they have with Washington.
Commerce Minister Piyush Goyal has been in the US since late September pushing the negotiations. Earlier in the year the two sides had finalised a framework for an interim deal, and there were moments when people thought it was almost done. Then the tariff landscape shifted and the remaining sensitive issues—market access, treatment of domestic sectors, how competitive India would be treated relative to other countries—kept the talks stuck.
Sitharaman’s comments are the strongest public signal yet from the Indian side that further big concessions are hard. She’s not saying the deal is dead. She’s saying the room to move has narrowed a lot. Both sides still talk about wanting an agreement. Greer mentioned that Trump and Modi could speak again soon to take stock. But the practical reality right now is that the remaining differences require compromises that neither capital seems ready to make easily.
For India, the US remains a crucial export market. Goods trade surplus with America has been healthy. At the same time, New Delhi has to protect its own sensitive sectors and ensure any deal doesn’t leave it worse off when other countries get better terms. For the US, the priority is clearly cutting the deficit and using every tool available, including tariffs, to rebalance things.
So where does that leave us? Still talking, still negotiating, but without the sense of imminent breakthrough that was floating around a few weeks ago. Sitharaman’s “plateau” description feels accurate. The hard work of the past months has brought them this far. Moving past it will need either fresh flexibility or a political push from the top on both sides.
Trade deals between two large economies are never simple. They involve real interests, domestic constituencies, and long-term strategic calculations. Right now those calculations seem to be pulling in slightly different directions. Whether the remaining room to operate is enough will become clearer in the coming weeks. For the moment, though, the finance minister has been refreshingly direct: further give-and-take is going to be very difficult.
Sources: Indian Express, Times of India, The Hindu, Reuters, Business Today, CNBC-TV18, Firstpost, Hindustan Times (reporting on Nirmala Sitharaman’s remarks at the Munich Leaders Meeting, 5 October 2026, and related statements by USTR Jamieson Greer).
@Rohit Manral
