Trump’s Reciprocal Tariffs Set for April: India Pursues Separate Trade Deal

President Trump aims to impose reciprocal tariffs on multiple nations, including India, from April 2 due to unfair trade practices. Indian officials remain optimistic about avoiding these tariffs through ongoing negotiations led by Commerce Minister Piyush Goyal during his US visit, which may facilitate a bilateral trade agreement by 2025, aiming to significantly increase trade volumes by 2030.

On April 2, United States President Donald Trump plans to implement reciprocal tariffs in response to perceived unfair trade practices, impacting various countries including India. Trump unveiled his proposal during a Congressional address, expressing his concerns over high tariffs imposed by countries such as Brazil, India, and China. Meanwhile, Indian officials maintain hope for a resolution through active trade negotiations currently in progress with the US, as India’s commerce minister, Piyush Goyal, engages in discussions during his week-long visit to the US.

Insiders in the negotiations suggest that India may evade the impending tariffs, owing to constructive dialogues addressing mutual concerns, particularly related to tariff and non-tariff barriers. Goyal’s delegation aims to advance discussions in alignment with agreements made between President Trump and Prime Minister Modi earlier in the year. They anticipate establishing the groundwork for a mutually beneficial bilateral trade agreement by the fall of 2025.

Emerging markets in Asia have experienced a degree of relief in light of potential tariff retractions suggested by US Commerce Secretary Howard Lutnick. Indian markets notably experienced gains during this period. Goyal’s agenda includes significant meetings with key US officials to discuss the roadmap for a forthcoming trade agreement, showcasing India’s commitment to fostering trade relations despite impending tariff challenges.

Additionally, considerations for ongoing free trade agreements with the European Union and the United Kingdom emphasize India’s willingness to negotiate reductions in automobile tariffs in exchange for concessions in professional mobility. This strategy reflects India’s competitive automobile sector, which is prepared to contend with American enterprises, contingent upon reciprocal arrangements.

Trump’s tariff proposal explicitly calls for adjustments to address longstanding trade imbalances, although he refrained from singling out India directly as a target among the nations with higher tariffs on US goods. He criticized the excessive tariffs imposed by other countries, asserting that the US would implement tariffs mirroring those levied against them.

The fiscal context reveals significant trade deficits faced by the US with major trade partners, as well as a smaller deficit with India, which totaled $45.7 billion in 2024. The overall trade relationship between the two nations was valued at approximately $129.2 billion the same year, highlighting the importance of ongoing negotiations aimed at achieving a goal of $500 billion in bilateral trade by 2030. The two leaders committed to negotiating terms that would foster fairness and job creation while also aiming to enhance the overall trade framework.

The proactive engagement of the Indian government with the Trump administration signifies their intent to mitigate potential tariff implications while working towards a comprehensive trade accord that benefits both parties.

In summary, the upcoming implementation of reciprocal tariffs by President Trump, set for April 2, signals renewed tensions in US-India trade relations. However, ongoing negotiations signal a potential pathway to a subtler resolution. With India’s commerce minister leading discussions and the aim to establish a bilateral trade agreement by 2025, both countries appear invested in finding common ground to enhance their trade partnership.

Original Source: www.hindustantimes.com