The India-US trade agreement remains stalled due to unresolved tariff disputes rather than diplomatic communication issues, according to Mark Linscott, former Assistant US Trade Representative. His assessment directly counters recent claims by US Commerce Secretary Howard Lutnick, who suggested the deal failed because Prime Minister Modi did not personally call President Trump to finalize it.

Expert Analysis Challenges Communication Narrative

Linscott emphasized that focusing on phone calls misrepresents the real challenges in negotiations. Speaking to CNBC-TV18, he acknowledged Trump's decisive role in closing trade agreements but stressed that substantive discussions between India and the US had advanced significantly through official channels over several months.

"I think where we still have a big gap, and what is holding up more progress, is what the reciprocal tariff rate will be," Linscott stated. He noted that India seeks clarity on whether tariffs would align with levels granted to the European Union.

Political Response and Historical Context

Lutnick's podcast comments triggered sharp reactions in New Delhi, with India's External Affairs Ministry rejecting his characterization and confirming that Modi and Trump had spoken eight times in 2025, including discussions on trade matters.

Former Indian Ambassador to the US Arun Singh described Lutnick's claims as reflecting long-standing perception differences between Washington and New Delhi. He argued that negotiations originally shaped up as balanced agreements with mutual concessions, but this approach lost favor as Trump sought to project unilateral wins domestically.

Escalating Demands and Negotiation Challenges

International trade policy expert Abhijit Das presented a more pessimistic outlook, suggesting US demands from India continue rising regardless of concessions already offered. He argued that India weakened its negotiating position by offering concessions before formal talks commenced, including budget measures to ease trade frictions.

"Whatever we put on the table, even if it's the best offer from the Indian side, does not seem to meet the expectations of President Trump," Das explained, expressing doubt about achieving a genuinely balanced outcome.

Optimistic Outlook Despite Challenges

Despite these concerns, Linscott maintained optimism about reaching an agreement. He downplayed suggestions that the US seeks sweeping additional concessions in sensitive sectors like agriculture and dairy in a first-phase deal, arguing that broad agreement contours are already established.

"I'm bullish, and I still am quite hopeful that this can be done relatively soon," Linscott stated, reiterating that tariffs remain the central unresolved issue.

Legal and Policy Uncertainties

The situation faces additional complexity from legal challenges to Trump-era tariffs in the US Supreme Court. While a verdict could potentially eliminate some levies, experts noted the administration has alternative legal routes to reimpose tariffs under different trade laws, creating continued uncertainty for Indian exporters.

The expert assessments collectively suggest the India-US trade deal represents less a failure of personal diplomacy and more a reflection of complex tariff negotiations and domestic political considerations in Washington.

The Indian government has firmly reiterated its position on energy sourcing policies, signaling continued oil imports from Russia despite facing the threat of a proposed 500% US tariff. President Donald Trump backed the bill on January 8, targeting India, China, and other countries purchasing Russian oil.

Government Response to Tariff Threat

MEA spokesperson Randhri Jaiswal acknowledged awareness of the proposed legislation while reaffirming India's energy strategy. "We are aware of the proposed bill. We are closely following the developments," Jaiswal stated in response to a CNBC-TV18 query.

The spokesperson emphasized India's commitment to energy security for its massive population. "Our position on the larger question of energy sourcing is well known. We are guided by the evolving dynamics of the global market and by the imperative to secure affordable energy from diverse sources to meet the energy security needs of our 1.4 billion people," Jaiswal explained.

Current Tariff Impact

India is already facing financial consequences for its Russia ties, currently paying substantial penalties on energy and defense purchases.

Trade Deal Negotiations Clarification

The MEA strongly rejected claims made by US Commerce Secretary Howard Lutnick, who blamed Modi for stalled trade negotiations. Lutnick had claimed in a podcast that the trade deal failed because Modi did not call Trump, stating: "Let's be clear, it's his (Trump's) deal. He is the closer. He does it. It's all set up, you've got to have Modi, call the President. They were uncomfortable doing it. So, Modi didn't call."

The MEA spokesperson countered these characterizations as inaccurate. "We have been committed to trade negotiations with US as far as back as 13th of February last year. We have held multiple discussions on a fair and mutually beneficial bilateral trade deal. The way the status of talks have been characterised in the statements is not accurate," he stated.

Diplomatic Engagement

The ministry highlighted ongoing high-level diplomatic communication between the two nations, noting that Trump and Modi have spoken on eight occasions in 2025 on various issues. This contradicts Lutnick's suggestion of limited communication between the leaders.

The MEA emphasized that trade negotiations have come close to finalizing on several occasions, indicating active engagement rather than the stalled process suggested by the US Commerce Secretary's comments.