Global trade and tariff war seem to be in shocks, but for the time being, India keeps its cards near the chest. Officials pointed out that India has already reduced import obligations to several items in rationalization in the Union 2025-26 budget and waits for the impact to see. According to sources, India may be willing to reduce tariffs to more imports from the US, but so far, hopes have been attached to the premiere of Narendry Modi with US President Donald Trump during his two -day visit to Washington from February 12, 2025.
Trump announced that the US will increase import duties on aluminum and steel to 25% of 10% with effect from March 4, which could have a direct impact on countries like India.
This is the repetition of the tariffs, which he imposed in March 2018 during the first term as a US President. Removed tariffs on imports of steel and aluminum from India 3.
The Global Trade Research Initiative report has pointed out that the return of the tariffs to steel and aluminum can be used as a leverage effect in business negotiations. “The 2018 tariffs were widely considered to be an aggressive strategy that forced business partners to concessions. The last step, if implemented, could lead to new commercial disputes and reprisal measures from the affected countries, ”the report said.
However, the Nomura report noted that the developing Asian economies, including India, Thailand and China, have higher relative export rates in the US and are thus threatened by higher reciprocal tariffs. According to the report, India has 9.5% weighted average efficient US exports to India compared to 3% of tariff rate for Indian exports to the US.
“We expect the Asian economies to increase their actions with Trump.” India is considering a decrease in tariffs to more than 30 items, including luxury vehicles, solar cells and chemicals and preparations for increasing shopping for US defense and energy, ”the report said.
The US represents nearly 18% of India's total exports (or about 2.2% of GDP, from FY24) and are the largest Indian export goal, and in recent years a surplus in India-USA has been growing to about $ 38 billion in recent years. Electric/industrial machines, gems and jewelry, pharmacies, fuels, iron and steel, textiles, vehicles, clothing and chemicals, of which iron and aluminum and aluminum are almost 5.5% of the total. said the message.
In an interview with BT budgeting, however, the Minister of Finance and Income Tuhin Kanta Pandey noted that Indian tariffs were not very high. “You would see important products imported from the US to industrial goods on 13 large products from the US, our tariffs are within 10%,” he said, adding that the budget was further reduced.
The effective rate of India is now up to 10.6%, which is close to ASEAN, he noted. At first it was 13% and then reduced to 11.6% in the last budget.
The Budget of the Union 2025-26 removed seven customs customs rates and now remained only eight rates, including zero rates, and has rationalized rates for several items.
