Is India affected by the tariff increases already in place, particularly on aluminium and steel? Experts say the impact on India will be minimal.
On March 14, two separate social media messages — one from India’s Commerce Minister Piyush Goyal and the other from the US Trade Representative (USTR) Jamieson Greer — hinted at the complexity and shared goals of the ongoing India-US bilateral efforts towards a quick Free Trade Agreement (FTA).
“Had a forward-looking discussion with US Trade Representative Jamieson Greer on a mutually beneficial Bilateral Trade Agreement. Our approach will be guided by ‘India First,’ ‘Viksit Bharat,’ and our Comprehensive Strategic Partnership,” Goyal said on the social media platform X. On the same platform, the official handle of the Office of the USTR posted a message saying, “Ambassador Jamieson Greer had a productive meeting with the Indian Minister of Commerce and Industry Piyush Goyal during his recent trip to the United States,” adding that “they have since continued to have engaging conversations on reciprocal trade, expanding market access, and President Trump’s America First Trade Policy.”
The messages are clear. It’s “India First” for India and “America First” for the US — and both countries are keen on an FTA that expands market access for each side. But how can the interests of one country be served without harming the other? How can trade expand in an increasingly protectionist global environment? That’s where the complexity of the ongoing bilateral trade treaty negotiations between India and the US lies.
A mutually acceptable solution becomes even more difficult as US President Donald Trump continues to raise — and, in some cases, threatens to raise — tariffs unilaterally on several products from multiple countries. In recent weeks, Trump’s tariff hike announcements have included a 20% increase in import duties from China, a 25% hike on a range of goods from Canada and Mexico, and higher tariffs on steel and aluminium from all major trade partners, including India. He has also threatened to impose a 25% duty on all products from the European Union and a similar 25% duty on imports of cars, semiconductors, and pharmaceutical products from all countries starting in April. Additional tariffs on timber, copper, and other products are expected by the end of the year. India-US bilateral trade negotiations are unfolding against the backdrop of these tariff threats from the US president.
Another key concern for India is the tariff threat on pharmaceuticals, which is expected to take effect in the first week of April. This is significant given India’s major presence as a supplier of generic drugs in the US market.
Can the bilateral talks move forward in such a situation?
Experts suggest that one way would be to focus on areas of mutual interest where both countries stand to benefit — such as technology transfer. If the US gains through commercial technology transfers, India could benefit through improved access to advanced technology. Another approach could be to consider product categories as a whole instead of negotiating tariff reductions on individual products. India could reduce import duties on certain products, while the US could offer easier market access to others. To reduce the trade imbalance, India could also import more crude oil from the US without having to engage in time-consuming product-level negotiations.
Even that option seems difficult as the US appears keen to touch upon sensitive sectors for India, including agricultural products — an issue that has not gone down well with many, including members of the Rashtriya Swayamsevak Sangh (RSS), the ideological parent of the ruling BJP.
A resolution passed at the National Council of the RSS affiliate Swadeshi Jagaran Manch (SJM) makes its stance on the US demand for lower tariffs on agricultural imports clear: “Protect the interests of Indian farmers and small industries while negotiating the Indo-US Bilateral Trade Agreement,” it states. “In the last 10 years, the Indian government has protected the interests of farmers and their livelihoods while negotiating trade agreements — whether it was a regional trade and investment agreement or the RCEP, from which it withdrew due to concerns over its adverse impact on dairy and agriculture. This policy needs to continue, especially where the livelihoods of farmers and workers are concerned,” the resolution passed at SJM’s National Council meeting on March 9–10 stated. SJM has also advocated greater use of Indian products to reduce reliance on imports.
It seems that until Trump moderates his stance, India-US trade talks are likely to remain tough.
You can now read the most important #news on #eDairyNews #Whatsapp channels!!!
🇮🇳 eDairy News ÍNDIA: https://whatsapp.com/channel/0029VaPidCcGpLHImBQk6x1F
