The US-India agreement is "close to being reached," and India wants more favorable tariffs than Indonesia

India is "close to reaching" a trade agreement with the Trump administration, seeking more favorable tariff rates than Indonesia. According to Xinhua News Agency, Trump announced on July 15 local time that a 19% tariff would be imposed on imported goods from Indonesia, while American goods could enter the Indonesian market tariff-free. According to a previous article from Jianwen, the 19% tariff imposed by the U.S. on Indonesia is lower than the previously threatened 32%. Media reports indicate that the India agreement will "follow the same route," and the U.S. will "gain access to India." Trump stated on Wednesday that negotiations are ongoing with India, and the U.S. and India are close to reaching an agreement. Reports indicate that Indian officials revealed that India seeks more favorable tariff rates than Indonesia. Currently, the Indian negotiating team is advancing talks in Washington, and both sides are working to reduce the proposed tariff to below 20%. India Seeks Regional Competitive Advantage India hopes to gain a competitive advantage in tariff rates relative to regional peers. According to informed officials, India believes the U.S. will not view it as a transshipment hub like Vietnam and other Southeast Asian countries, and the negotiations so far indicate that India's tariff rates will be more favorable than those of these countries. In addition to announcing a 19% tariff on Indonesia, on July 2, Trump stated on social media that a trade agreement had been reached with Vietnam, where all goods exported to the U.S. would face at least a 20% tariff, and the U.S. would "fully open its market." Soumya Kanti Ghosh, chief economist at the State Bank of India and a member of the Prime Minister's Economic Advisory Council, stated that the negotiating team hopes to reduce tariffs to below 10%. "In exchange, the U.S. will expect significant concessions when its goods enter India." While India is reluctant to open up the agricultural and dairy sectors, it may offer concessions in non-agricultural areas. Additionally, India has proposed that if the U.S. takes similar action, it would reduce tariffs on U.S. industrial goods to zero and has suggested the possibility of purchasing more Boeing aircraft. Tariff Rates Trending Towards a Unified Range According to Xinhua News Agency, Trump stated on the 15th that he plans to impose tariffs of over 10% on smaller countries, including those in Africa and the Caribbean. Barclays Singapore economist Brian Tan stated that the latest developments indicate that tariff rates are trending towards the 15%-20% range, which is the preferred level expressed by Trump himself. He believes that the tariff letters sent to trading partners so far may be a negotiation strategy aimed at bringing governments back to the negotiating table and providing better terms for the United States, "allowing the Trump administration to secure a superior 'deal'." The Malaysian Trade Minister stated that they are waiting for the details of the agreement with Indonesia, which is still negotiating its own tariffs with the United States. Investment Trade and Industry Minister Tengku Zafrul emphasized: "The most important thing is that we must ensure this is a negotiation beneficial to both countries. It must be a win-win." According to a previous article by Jianwen, after announcing the trade agreement with Indonesia, Trump stated that as part of the agreement, Indonesia committed to purchasing $15 billion worth of U.S. energy, $4.5 billion worth of U.S. agricultural products, and 50 Boeing aircraft. According to CCTV News, U.S. ranchers, farmers, and fishermen will have full access to the Indonesian market for the first time, and under the agreement, if any goods are transshipped through Indonesia from countries with higher tariffs, those tariffs will be added to the tariffs paid by Indonesia