The India-US trade deal didn’t happen because Prime Minister Narendra Modi didn’t call US President Donald Trump, according to US Commerce Secretary Howard Lutnick.
Speaking with venture capitalist and entrepreneur Chamath Palihapitiya on his ‘All In’ podcast on Thursday, Lutnick said he asked for PM Modi to call Trump to close the deal. However, he said India was “uncomfortable” doing it, “so Modi didn’t call”.
Lutnick said the US did trade deals with Indonesia, the Philippines and Vietnam but he assumed the trade deal with India was going to be done before them.
“… we did Indonesia, the Philippines, Vietnam, we announced a whole bunch of deals. So we did these whole bunch of deals…because we negotiated them and assumed India was going to be done before them, I have negotiated them at a higher rate,” Lutnick said.
“So now the problem is the deals came out at a higher rate. And then India calls back and says, ‘Oh, okay, we are ready’. I said, ready for what.”
India-US trade deal — In limbo?
Lutnick’s remarks came a few days after Trump said that PM Modi knew he was unhappy with India’s purchases of Russian oil and that Washington could raise tariffs on New Delhi “very quickly”.
The threat by the US president came at a time when Washington and New Delhi were hammering out the contours of a India-US trade deal. Six rounds of talks have been held so far. The pact includes a framework deal to resolve the 50% tariffs on Indian goods entering the US.
50% to 500% — More US tariffs on India?
Meanwhile, Trump has greenlit a bipartisan Russia Sanctions Bill, which allows the US to impose at least 500% tariff on India, China and Brazil to curb their Russian oil imports.
“This bill will allow President Trump to punish those countries who buy cheap Russian oil fueling Putin’s war machine,” Republic Senator Lindsay Graham wrote on X, formerly Twitter, on 8 January 2026. He, along with Democratic Senator Richard Blumenthal, drafted the bill.
“This bill would give President Trump tremendous leverage against countries like China, India and Brazil to incentivise them to stop buying the cheap Russian oil that provides the financing for Putin’s bloodbath against Ukraine. I look forward to a strong bipartisan vote, hopefully as early as next week.”