‘Modi didn’t call’: US Commerce Secretary Howard Lutnick on what derailed high-stakes India-US trade deal

US Commerce Secretary Howard Lutnick has suggested that the Indo-US trade deal fell through because Prime Minister Narendra Modi did not call US President Donald Trump after the agreement had been set up. He added that Indian negotiators later returned to him to finalise the deal, but by then, Washington wanted different terms and conditions.

Lutnick’s remarks, made during an interview on the All-In podcast on January 9, are significant as they disclose an important detail in the negotiations: India and the US had reached an understanding on a deal, only for US negotiators to backtrack later.

“What I would do is I would negotiate the contracts and set the whole deal up. But let’s be clear, it’s his deal. Yeah, okay, he’s the closer. He does the deal. So I said, ‘You got to have Modi (call). It’s all set up. You have to have Modi call the president.’ They were uncomfortable doing it, so Modi didn’t call,” Lutnick said.

The remarks come a day after veteran Republican leader and US Senator Lindsey Graham said that President Trump had “greenlit” the Russia sanctions bill, which aims to impose 500 per cent tariffs on countries for buying Russian oil. India is already facing tariffs of up to 50 per cent on its exports to the US—a move that has dented the country’s exports to one of its top destinations and adversely affected investment flows.

“India just was, you know, on the wrong side of the seesaw…,” Lutnick said. “It was just they couldn’t get it done when they needed to, and then they couldn’t get it done, and then they couldn’t get it done, and then they couldn’t get it done. And so what happened is all these other countries kept doing deals, and they’re just further in the back of the line, and now when they say, but what I want is, I want the deal in between the UK and Vietnam, right? Because that’s what I negotiate, right? And they remember, and I remember they say, but, but you agreed? And I said, then. Not now,” he added.

Lutnick gave his version of the sequence of events, as he described Trump’s style of negotiating deals as a staircase.

“If you remember, I did the first deal, the UK, and we told the UK that they had to get it done by two Fridays, that that was the date that the train was going to leave the station by two Fridays. Because I have a lot of other countries doing things, and you know, if someone else is first, the first, and President Trump does deals like a staircase. First stair gets the best deal. You can’t get the best deal. After the first guy went, everyone says, I want the UK deal. I want the UK deal. The answer is, no. They were first. They took the chance. They moved quickest,” he said.

“They’re first, and then the next one’s got to be higher, and then the next one higher, and the next one higher, the next one. So he does things that way, because that way it incentivises you to come to the table, right? You could have three countries who are the second deal. They all get done the same time, right? But you know, if you want to wait and see how it goes, it’s at your risk. So he does the UK deal, and they had to get it done by Friday,” he added.

“So everybody asked the president, who do you think is next? And if you look back at the time, he said he talks about a variety of countries, but he names India a couple of times publicly. It’s not like a big secret. And we were talking India, and we told India, you had three Fridays to get it done,” Lutnick said.

“Because what happens is, I have lots of other countries, and when those other countries do their deal, the staircase goes up and right. And now the president, during all these deals, he would refer to me as the greatest table setter who ever lived. Okay? Because you’ve never had anybody who was as successful as me as a businessman before, who’s just the tables, you know? So because what I would do is I would negotiate the contracts and set the whole deal up. But let’s be clear, it’s his deal,” the US commerce secretary said.

“So that Friday left, middle of the next week, we did Indonesia, the Philippines, right? Vietnam, we announced a whole bunch of deals. So we did these whole bunch of deals. So that’s like that staircase, and they were at and because we negotiated them and assumed India was going to be done before them, I had negotiated them at a higher rate. So now the problem is the deals came out at a higher rate, right? And then India calls back and says, Oh, okay, we were ready. I said, ready for what it was like three weeks later. I go, ‘are you ready for the train that left the station three weeks ago?’” Lutnick said.