India and US Begin Trade Talks, Tariff Cut Details Still Early, Says Government

New Delhi – Trade discussions between India and the United States are in their early stages, and it’s too soon to discuss specific details like reducing tariffs, according to Indian government sources. This statement came just hours after US President Donald Trump announced that India had agreed to “significantly cut tariffs” on American goods.  

Government officials, speaking to the Press Trust of India (PTI), emphasized that both nations have their own priorities and concerns, which are expected to be part of the trade discussions.

India and the US officially started negotiations for a comprehensive Bilateral Trade Agreement (BTA) following a meeting between Indian Prime Minister Narendra Modi and President Trump in Washington last month. The initial phase of this agreement is expected to be finalized by fall 2025.  

India’s Commerce Minister Piyush Goyal recently concluded meetings with his US counterparts in America from March 3rd to 6th to advance these trade talks.  

However, President Trump’s recent statement about India agreeing to substantial tariff reductions was perceived as “premature” by officials in New Delhi.  

Speaking to reporters, President Trump had claimed, “India charges us massive tariffs…they have agreed to cut their tariffs way down now because somebody is finally exposing them.”

India’s Cautious Response

In response to President Trump’s remarks, India’s Foreign Secretary Vikram Misri addressed the media but refrained from commenting on the specifics of tariff cuts or trade deal negotiations.  

“I will not get into that at this point…these are ongoing discussions,” Misri stated, emphasizing the sensitivity of the ongoing talks.

However, Misri highlighted that India has a history of tariff reductions in its bilateral trade agreements with other countries. He suggested that the current discussions with the US should be viewed in this broader context of India’s trade liberalization efforts.  

While India has not directly addressed President Trump’s claims about reciprocal tariffs, it has affirmed its commitment to strengthening trade relations with the US. This includes exploring ways to lower both tariff and non-tariff barriers as part of the BTA.

According to a spokesperson from India’s Ministry of External Affairs, Randhir Jaiswal, the goal of the BTA is to boost trade in goods and services, improve market access, reduce trade barriers, and enhance supply chain cooperation between the two nations.  

In a move seen as a positive signal, India’s recent budget for 2025-26 included tariff reductions on certain US products like Bourbon whiskey, wines, and electric vehicles.  

Trump’s “America First” Trade Policy

President Trump’s announcement of reciprocal tariffs, set to begin on April 2nd, aligns with his “America First” trade policy. This policy has raised concerns about a potential global trade war, with several countries considering retaliatory measures.  

Indian government sources clarified that discussions on tariffs and other trade-related issues, initiated during Prime Minister Modi’s visit to Washington, are still in progress.  

Sources indicated that while specific points have been discussed, it’s too early to delve into details as negotiations are just beginning. They also pointed out that previous attempts at a limited trade deal during President Trump’s first term did not materialize.  

India has recently finalized mutually beneficial trade agreements with countries like Australia, the UAE, Switzerland, and Norway, which involved significant tariff reductions. Similar negotiations are ongoing with the European Union and the UK.  

The US has also been urging India to increase its imports of American oil, gas, and military equipment to reduce the trade deficit, which currently favors India by approximately USD 45 billion.  

Despite trade tensions, the US remains India’s largest trading partner, with total trade in goods and services reaching USD 190 billion in 2023. In the fiscal year 2023-24, the US was also the third-largest source of foreign investment into India, totaling USD 4.99 billion.  

(With inputs from PTI) Sources and related content