No Call, No Deal: Lutnick Claims Modi Silence Stalled US Trade Pact
WASHINGTON/NEW DELHI — A long-awaited trade agreement between India and the United States has stalled because Prime Minister Narendra Modi did not place a final phone call to President Donald Trump to seal the deal, U.S. Commerce Secretary Howard Lutnick claimed on Friday.
Speaking on the All-In Podcast, Lutnick gave a detailed account of the collapsed negotiations, stating that the agreement was “all set up” but failed because New Delhi was “uncomfortable” with the requirement for a direct leader-to-leader conversation to finalize it.
“Let’s be clear, it’s his [Trump’s] deal. He is the closer. He does the deal,” Lutnick told podcast host Chamath Palihapitiya. “I said, ‘You’ve got to have Modi call the President. It’s all set up.’ They were uncomfortable doing it. So, Modi didn’t call.”
The “Staircase” Strategy and Missed Deadlines
Lutnick described the Trump administration’s trade negotiation strategy as a “staircase,” designed to reward countries that sign early with the most favorable terms. He cited the United Kingdom, which signed a deal in May 2025, as securing the “first stair” and the best rates.
According to Lutnick, India was given a strict deadline—a window of “three Fridays”—to finalize the pact before the administration moved on to other Asian nations.
“We assumed a trade deal with India before them,” Lutnick explained. When the call from New Delhi did not come, the U.S. pivoted, signing agreements with Indonesia, the Philippines, Vietnam, and Malaysia instead. Because these deals occurred later on the “staircase,” they were negotiated at higher tariff rates.
Lutnick recounted that Indian officials contacted the U.S. weeks later, signaling readiness to proceed. “India calls back and says, ‘Oh, okay, we’re ready.’ I said, ‘Ready for what? Are you ready for the train that left the station three weeks ago?'”
“Wrong Side of the Seesaw”
The collapse of the talks has left India in a precarious economic position relative to the U.S. Lutnick remarked that New Delhi is now on the “wrong side of the seesaw,” having lost the leverage to secure a “first-mover” advantage.
The stalemate comes amid intensifying trade friction. The Trump administration has already imposed combined tariffs of 50% on Indian goods—split between a reciprocal duty and punitive levies. Additionally, President Trump recently approved a “Russia Sanctions Bill” that threatens to impose tariffs as high as 500% on countries, including India, China, and Brazil, that continue to purchase Russian oil.
Diplomatic Fallout
There has been no official response from India’s Ministry of External Affairs regarding Lutnick’s claims. However, reports citing Indian officials suggest the hesitation stemmed from a fear that a direct, one-sided conversation with President Trump could put Prime Minister Modi in a difficult diplomatic spot.
For now, the comprehensive trade deal, which aimed to resolve tariff disputes and deepen bilateral economic ties, remains in limbo. “India will work it out,” Lutnick added, though he emphasized that the favorable terms previously on the table are no longer available.
