The US is working toward an interim trade deal with India that may reduce its proposed tariffs to below 20%, people familiar with the matter said, putting the South Asian nation in a favorable position against its peers in the region.

India may secure a strategic edge over regional rivals as the Trump administration considers a trade pact slashing proposed tariffs below 20 per cent. Unlike many nations facing sharp hikes, India is unlikely to receive a formal tariff notice ahead of the August 1 deadline.

India's the second largest shoe producer after China, and its absence from Trump's tariff letters so far means he's still considering trade terms.