India’s trade pact with the United States was delayed because Prime Minister Narendra Modi did not make a telephone call to President Donald Trump to close a deal they were negotiating, Commerce Secretary Howard Lutnick said on Friday.
The trade talks fell apart last year and Trump doubled tariffs on Indian goods in August to 50%, the world’s highest rate, including a levy of 25% in retaliation for India’s purchases of Russian oil.
“It’s all set up and you have got to have Modi call the President. And they were uncomfortable doing it,” Lutnick said in an interview on the All-In podcast, a US show by four venture capitalists that focuses on business and technology.
“So Modi didn’t call.”
The comments came after Trump stepped up the pressure for talks with a warning this week that tariffs could rise further unless India curbs its Russian oil imports.
That step pushed the Indian rupee to a record low and spooked investors waiting for progress in two-way negotiations for a trade deal that remains elusive.
India still seeks a tariff rate between Washington’s offers to Britain and Vietnam that had formerly been agreed but the offer has expired, Lutnick added.
India’s trade ministry did not immediately respond to an e-mailed request for comment on Lutnick’s remarks.
New Delhi and Washington were very close to a trade deal last year but a communication breakdown led to the collapse of any potential pact, Reuters reported.
It cited an Indian government official involved in the talks as saying that Modi could not have called Trump, for fear that a one-sided conversation would put him on the spot.