The report highlights that the nation has been working to keep away from commerce disputes with the US. In its current Union Price range, the federal government diminished import duties on a spread of merchandise, together with electronics, textiles, and high-end bikes.
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Moreover, India has taken steps to strengthen diplomatic ties with the US, resembling agreeing to repatriate over 100 unlawful Indian immigrants. Now, India is contemplating additional tariff reductions on luxurious autos, photo voltaic cells, and chemical substances as a part of its technique to keep up easy commerce relations.
Nomura mentioned “India is contemplating decreasing tariffs on over 30 objects and getting ready to extend purchases of US defence and power”.
The report additionally acknowledged that if India doesn’t scale back increased tariffs on American items, the US could reply with comparable duties on Indian exports.For instance, if India levies a 25 per cent tariff on US cars, Washington might impose an equal tariff on Indian autos. US President Donald Trump, who has criticized India’s commerce insurance policies up to now, has pushed for “reciprocal tariffs” to make sure honest remedy of US exports.The report identified that India has comparatively increased tariff charges in comparison with different international locations, making it weak to US retaliatory measures. The US is India’s largest export vacation spot, accounting for about 18 per cent of its complete exports, which amounted to about 2.2 per cent of India’s GDP in FY24.
India’s commerce surplus with the US has been rising lately, reaching almost USD 38 billion in 2024. Key Indian exports to the US embrace industrial equipment, gems and jewelry, prescription drugs, fuels, iron and metal, textiles, autos, and chemical substances.
Trump has beforehand referred to as India the “tariff king” and has emphasised the necessity for India to purchase extra American-made safety tools. In current discussions with Prime Minister Narendra Modi, he has pushed for a “honest bilateral buying and selling relationship.”
To forestall the imposition of upper reciprocal tariffs, the report acknowledged that India is exploring methods to succeed in an settlement with the US. Within the medium time period, the nation can be seeking to strengthen financial ties with Washington and entice extra American provide chains to arrange operations in India.
Prime Minister Narendra Modi assembly with President Trump on Friday in Washington is anticipated to debate tariffs and commerce.
