India mulls tariff cut on 55% of US imports to protect exports: Reuters
Make us a preferred source
Make us a preferred source on Google
The news: India is considering cutting tariffs on over half of US imports to the country, as it seeks to mitigate impending reciprocal tariffs imposed by the US administration, according to government sources cited by Reuters.
The numbers: India would cut tariffs on 55% of US imports, amounting to USD23 billion ($36.4 billion) worth of goods, in the first phase of a trade deal currently under negotiation between the countries.
The US goods which India is open to reducing tariffs on, are currently subject to tariffs ranging from 5% to 30%. Within this category, India is ready to meaningfully lower or cancel tariffs entirely.
The context: New Delhi is working to soften the impact of US President Donald Trump’s worldwide tariffs due to come into effect from 2 April, as it estimates that reciprocal tariffs could hit 87% of its total exports to the United States, worth USD66 billion.
The South Asian nation estimates increases of 6% to 8% in tariff hikes on products including pearls, mineral fuels, boilers, machinery and electrical equipment, amounting to half of its US exports. USD11 billion worth of Indian pharmaceutical and automotive exports are also expected to be hit.
According to data from the World Trade Organisation, the US trade-weighted average tariff has been about 2.2%, compared with India's 12%, and the US has a trade deficit of USD45.6 billion with India. Trump has previously referred to India as a "tariff abuser" and "tariff king," while US Commerce Secretary Howard Lutnick said earlier this month that the country’s “special relationship” with the US needed a reassessment given the size of its import tariffs.
A US trade delegation is in India for talks this week, as New Delhi is motivated to strike a deal before the reciprocal tariffs are announced at the beginning of April.
The source: Reuters
