Delhi-based think tank Global Trade Research Initiative (GTRI) on Saturday said India should withdraw from all negotiations with the US and prepare to engage with the President Donald Trump-led administration in the same way as countries such as China and Canada are doing.

China and Canada have already announced retaliatory measures against US tariffs.

GTRI founder Ajay Srivastava said the US is exerting pressure on India to accept trade demands that largely favour American interests.

“Trump is insulting India publicly using wrong data. No balanced outcome is possible in such circumstances. India should withdraw from all negotiations and prepare to deal with them like other countries are doing,” Srivastava said.

On Friday, Trump claimed that India had agreed to cut tariffs on American imports after his administration “exposed” what he called unfair trade practices.

“This is patently incorrect and intended to pressurise India. India’s silence is baffling and India needs to counter with facts. The whole world is watching as Trump and his officials belittle India every day,” Srivastava said.

US commerce secretary Howard Lutnick has said that India needs to open its agriculture market, emphasising that it can not be “off the table” when the country is negotiating with its largest trading partner. He has pitched for a macro, large and grand trade agreement with India, and not a product-by-product arrangement to promote bilateral trade.

Among the sectors that could take a hit if a reciprocal tariff comes into effect are agriculture, meat, processed food, automobiles, diamonds, gold, chemicals and pharmaceuticals (see chart). Currently, US goods face a weighted average tariff of 7.7 per cent in India, while Indian exports to the US face 2.8 per cent, leading to a difference of 4.9 per cent.

According to the GTRI report, a comprehensive trade deal would open the door to US demands, not just on tariff reductions, but also on government procurement, agricultural subsidies, patent laws, and unrestricted data flows, all of which India has consistently opposed.

The GTRI said that Trump’s decision to impose a 25 per cent tariff on Mexico and Canada despite finalising the USMCA (US-Mexico-Canada trade agreement) in 2019 reflected his scepticism towards free trade agreements.

The think tank has suggested that India should consider a macro-level reciprocal tariff arrangement covering over 90 per cent of goods under a “Zero-for-Zero” approach, where India eliminates tariffs only if the US does the same.

“India should present this proposal before April, ahead of the US tariff decision,” GTRI said in a report.

Another option would be to lower dependence on the US. “India should quietly reduce the dependence on the US by avoiding preferential treatment on oil purchases, defence deals or other areas. The focus should be on strengthening domestic industries to prepare for the next phase of global trade,” GTRI said.

Srivastava said the US had earlier claimed a 100 per cent tariff on Harley Davidson motorcycles, while the actual tariff had been reduced to 30 per cent.

Union budget documents show the customs duty on motorcycles (completely built units) with an engine capacity of more than 1600cc has been lowered from 50 to 30 per cent.

“It is painful, despite repeated provocations from the US, the Indian government or any industry association has not countered such misinformation,” Srivastava said.