US President Donald Trump on Monday said the United States is “close to signing a trade deal” with India, after announcing new reciprocal tariffs on 14 countries — including Bangladesh, Malaysia, Japan, Cambodia and South Korea — setting rates at 25 to 40 per cent, and warning that rerouting foreign goods or retaliating would attract even higher US tariffs.
This comes as Indian negotiators are understood to have offered substantial market access to US products in most sectors, excluding sensitive areas such as dairy and agriculture. The US, in turn, is expected to offer lower tariffs on labour-intensive sectors such as textiles and footwear.
As India awaits an interim trade deal with the US, New Delhi was not among the 14 countries named in the initial list released by the US as the pause on reciprocal tariffs draws to a close. The Association of Southeast Asian Nations (ASEAN) — which the Indian Trade Minister Piyush Goyal last month referred to as “China’s B team” — appeared to be a top Trump target.
Six of the 14 countries named on Monday were ASEAN members, with Laos and Myanmar receiving the highest tariffs of 40 per cent. Thailand and Cambodia — both of which have received significant Chinese investment and have deepened economic integration with China over the last decade — were hit with 36 per cent US tariffs. Meanwhile, Indonesia, which imports nearly a third of its goods from China, was subject to a 32 per cent reciprocal tariff.
China is the largest financier of Cambodia’s infrastructure — including roads, bridges, dams, railways, and special economic zones (SEZs). Cambodia was also among the earliest and most active supporters of China’s global infrastructure plan, the Belt and Road Initiative (BRI).
Notably, following the first trade war, China increased its engagement with ASEAN countries through investment and industrial integration, helping to boost manufacturing across the region. In May, China and ASEAN completed negotiations to upgrade their free trade area, extending cooperation into the digital and green economies and other emerging industries.
India is also witnessing a surge in imports from the ASEAN region and is seeking to renegotiate the free trade agreement with the 10 ASEAN countries. However, talks are moving at a slow pace that has irritated negotiators in New Delhi.
While Japan, South Korea, Malaysia, Kazakhstan and Tunisia face 25 per cent tariffs, a 30 per cent duty was imposed on South Africa and Bosnia & Herzegovina. Bangladesh — a major textiles hub — and Serbia both face 35 per cent tariffs.
The New Delhi-based think tank Global Trade and Research Initiative (GTRI) noted that while the deals announced by the US are being presented as trade “agreements”, they do not meet WTO standards for Free Trade Agreements (FTAs). Under WTO rules, FTAs require mutual tariff reductions on a substantial share of trade, the think tank said.
“Under the Trump model, only the partner country lowers its MFN tariffs, while the US makes no reciprocal cuts. Trump lacks Fast Track Trade Authority from Congress to reduce MFN tariffs. Instead, he is offering to roll back only the ‘Liberation Day’ tariffs imposed in April under emergency powers — tariffs that a US federal court has already ruled unlawful. The case is under appeal, but the legal basis remains fragile,” GTRI said.
The think tank added that even if a deal is struck, Indian exports may still face a minimum 10 per cent additional levy, making it a pressured compromise rather than a true partnership. Trump’s unpredictability raises concerns that even signed deals may be revisited, it said.
Just last week, Trump threatened an additional 10 per cent tariff on BRICS countries — including Brazil, Russia, India and China — if they pursue what he called “anti-American” policies.
“This came after the BRICS Summit in Rio, where members condemned US unilateral tariffs and explored alternatives to the US dollar, including a common trade currency. The group’s expansion to include Iran, Saudi Arabia and the UAE has deepened fears in Washington of a multipolar shift in global trade leadership. Trump’s warning makes it clear: any country seen as aligning with BRICS positions may face new tariffs, regardless of previous deals. The message — loyalty trumps legality,” GTRI said.
