The US has set an April 2 deadline for tariffs, impacting India’s trade strategy. President Trump has highlighted the unfair tariffs imposed by countries including India. Minister Piyush Goyal is in Washington to resolve trade issues and discuss a Bilateral Trade Agreement, amid efforts to negotiate a significant trade deal by 2030. India’s government is preparing analyses and consultations to mitigate tariff impacts on its export sectors.
The United States has announced an April 2 deadline for tariffs, raising concerns for India as it scrambles to devise its trade strategy. President Trump has singled out India, along with the European Union, China, and Canada, for imposing higher levies. Indian Commerce and Industry Minister Piyush Goyal is currently in Washington to address trade issues and initiate discussions for a proposed Bilateral Trade Agreement.
In February, India and the US committed to negotiating a trade deal by year’s end and aimed for a remarkable $500 billion in annual trade by 2030. During his address, President Trump emphasized that other nations have long utilized tariffs unfairly, highlighting that countries like India impose tariffs exceeding 100% on certain goods, while Chinese tariffs on US products are reportedly twice as high as the similar American tariffs.
In anticipation of potential US tariff hikes, India is preparing to engage in stakeholder consultations to evaluate impacts on its export sectors. The Indian government hopes to negotiate terms that minimize reciprocal tariffs. Experts suggest that India may propose eliminating tariffs on American industrial products, contingent upon the US reciprocating with similar reductions for Indian goods. Strategic exclusions, such as agriculture, could help enhance negotiations.
Despite an average tariff of 7.7% imposed by India on American goods compared to 2.8% for Indian exports to the US, specific sectors, particularly motorcycles and textiles, are facing significantly higher tariffs. In FY24, the US accounted for $77.51 billion in Indian exports while India’s imports from the US were valued at $42.2 billion. There are concerns that increased tariffs might impact India’s competitiveness in the US market.
Simultaneously, India is also scrutinizing the repercussions of the US Trafficking Victims Protection Reauthorization Act, which hints at potential restrictions on imports if child labor practices in the Indian textile sector are not adequately addressed. Continuous government support for export credit and technological advancements is deemed essential to maintaining India’s market position.
In summary, the looming April 2 tariff deadline presented by the United States demands urgent attention from India as it strategizes on its trade negotiations. With the prospect of significant trade agreement talks underway, understanding the implications of tariffs and addressing issues such as child labor in textiles are crucial for maintaining competitiveness. The relationship between the two nations will significantly influence India’s export sectors in the coming months.
Original Source: m.economictimes.com
