US Trade Deal Failed Because PM Modi Didn’t Call Trump: Lutnick
US blames lack of Modi-Trump phone call for failed bilateral agreement.
US Commerce Secretary Howard Lutnick has publicly attributed the failure to secure a comprehensive bilateral trade deal between India and the United States to Prime Minister Narendra Modi's reluctance to place a direct personal call to President Donald Trump, despite the agreement having reached an advanced stage of preparation.
Speaking candidly during a January 8, 2026, appearance on the All-In Podcast, Lutnick described how he had specifically urged Indian counterparts for a leader-to-leader conversation to lock in the pact, noting that Indian officials conveyed discomfort with this expectation, ultimately resulting in Modi not making the call and the window for favorable terms closing.
Lutnick elaborated on President Trump's distinctive "staircase" approach to trade negotiations, wherein countries that engage and conclude agreements earliest receive the most advantageous tariff reductions and concessions, while those that delay or hesitate are offered progressively less generous terms, a strategy that saw the US swiftly finalize deals with Indonesia, the Philippines, and Vietnam at incrementally higher rates.
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As a direct consequence of the stalled talks, India continues to face substantial trade barriers, including a blanket 50 percent tariff on select imports, compounded by an additional 25 percent penalty tied to New Delhi's ongoing purchases of Russian energy, even though six rounds of intensive in-person negotiations had taken place throughout 2025, including a late-December visit by a US delegation led by Deputy Trade Representative Rick Switzer.
The revelation has triggered strong political reactions in India, with senior Congress leader Jairam Ramesh sharing a clip of Lutnick's remarks on social media accompanied by a biting caption that read, "No more hugs, no more posts. See what has become of things, in your unfaithful friendship," underscoring the perceived erosion of the once-celebrated personal rapport between Modi and Trump, previously highlighted by high-profile events such as the "Howdy Modi" rally in Houston and the "Namaste Trump" summit in Ahmedabad.
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