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Trade talks in last lap, India pushes US for access
India is willing to reduce tariffs on US imports if Washington reciprocates and exempts it from planned retaliatory tariffs, officials say.
India’s negotiators have indicated New Delhi is willing to further reduce tariffs on a host of American imports provided its action is reciprocated by Washington with preferential treatment such as exemption from the planned April 2 retaliatory tariff action, people aware of conversations between the teams of the two countries said.
India now expects some reassurances after having amply demonstrated that it treats America as a valued partner by reducing tariffs on products such as bourbon, motorcycles, ICT products and metals, they added, asking not to be named.
“India is willing to commit more. It can further reduce tariffs on host of American items while safeguarding its subsistence farmers and small industries. It is willing to address American concern of trade deficit with India through import diversion (for example sourcing more energy from the US instead of the Gulf region). But reciprocity is the key for ‘mutually beneficial’ trade relationship. We expect that Washington would not club India with those with whom the US has serious issues such as illegal immigration and currency manipulation,” one of the officials said.
Recently, India announced removal of the 6% Google tax (an equalisation levy on online advertisements). It is now awaiting American response, the people said .
Officials from both sides have been engaged in the “India-US Fast Track Mechanism” talks since Wednesday, discussing terms of reference (ToRs) and a roadmap for fast-tracking negotiations so that an Indo-US bilateral trade agreement (BTA) is signed by September 2025.
“When both parties are eager and engaged, imposition of retaliatory tariff is unwarranted,” a second person said.
A US team led by assistant trade representative Brendan Lynch is in New Delhi to negotiate the BTA with the team of Indian officials led by additional secretary Rajesh Agrawal. Although the three-day talks were supposed to conclude by Friday, they could continue until Saturday, hours before the departure of the US negotiating team, the people mentioned above said.
“Talks are on. So far, there is no clarity whether the Trump administration would also include India in the list of countries to face retaliatory tariffs, and if yes, to what extent. India would like the partner to give some definite commitment before it undertakes any major step such as further reducing import duties, etc. A good thing is that talks are on and all channels of dialogue are open,” the second person said, referring to US and Indian industry representatives meeting the Union finance minister on Thursday.
There are significant tariff disparities between the two countries. According to estimates by a Johns Hopkins university economics expert, India ranks eighth among countries with which the US has a trade deficit. An analysis of 2021-2023 data showed that in agriculture, India’s average tariff on US imports is 41.8% compared to the US tariff of 3.8% on Indian imports.
Senior executives of the US Chamber of Commerce and the US-India Business Council met Union finance minister Nirmala Sitharaman on Thursday and expressed their constructive support in strengthening Indo-US economic relationship. Sitharaman met Suzanne Clark, president and CEO of the US Chamber of Commerce, along with Atul Keshap, president of USIBC. Clark appreciated India’s continued reforms, including in FDI, leading to growing interest of US businesses in India, and underlined the increased cross-border investment, innovation, growing entrepreneurship and trade that strengthen the US-India partnership. Sitharaman is expected to embark on a week-long USA visit next month.
Trade talks are successful if both sides are willing and considerate, a third person said. “Leaders [President Trump and Prime Minister Narendra Modi] on February 13 agreed to conclude a mutually beneficial, multi-sector BTA by September this year. The progress is fast and in a positive direction. Let’s wait for April 2,” he added.
The April 2 deadline has already impacted global markets, with stock indices across the world remaining jittery as investors await clarity on US tariff plans.
