The White House is close to finalizing preliminary trade agreements with India and Japan as it seeks to defuse economic uncertainty and delay the imposition of sweeping tariffs, according to people familiar with the negotiations. The prospective deals are not expected to resolve core trade disputes but instead aim to establish broad frameworks for future negotiations, which officials acknowledged could take months to finalize.
"We're signing something that says we're going to start talks," said one person briefed on the matter, as reported by the Politico. Another official noted, "I wouldn't even call them deals," describing the agreements as "memorandums of understanding" or a general "architecture" to avert tariffs slated to take effect in early July.
The urgency comes after President Donald Trump's April 2 announcement of "reciprocal tariffs" as high as 50% on more than 50 countries and the European Union-part of a broader effort to reset U.S. trade policy. The initial rollout sparked sharp sell-offs in financial markets and prompted fears of a global slowdown. Trump paused the tariffs for 90 days beginning April 9 but left in place a 145% duty on Chinese imports.
Vice President JD Vance hinted at progress during a speech Tuesday in Jaipur, India, stating he and Indian Prime Minister Narendra Modi had "made very good progress." His office later confirmed that the two countries had finalized "terms of reference" for trade talks, though no specifics were disclosed. Japan, meanwhile, has taken a more cautious tone. "We do not intend to make one compromise after another to conclude negotiations swiftly," Prime Minister Shigeru Ishiba said last week.
The administration faces growing pressure to demonstrate movement as economic indicators falter. The Dow Jones Industrial Average fell nearly 1,000 points Monday, marking its worst April start since 1932. Kevin Madden, senior partner at the Penta Group, said the White House is attempting to "provide some momentum" and "political breathing room" through these frameworks.
However, the structure of the proposed agreements-designed to suggest that the U.S. is the preferred trading partner over China-could provoke diplomatic backlash. Both India and Japan have deep trade ties with Beijing and are wary of appearing to undermine them. On Monday, China's Commerce Ministry warned that any deal "at the expense of the Chinese side" would be "counterproductive and detrimental to others as well as to oneself."
