Govt examines US tariff move, seeks feedback from exporters: Commerce Dept

The government is carefully examining the implications of the 27 per cent reciprocal tariffs that the United States (US) plans to impose on India, and is in discussion with industry and exporters — to take feedback of their assessment of the tariffs and the evolving situation, the department of commerce said on Thursday.

 

The US President Donald Trump on Wednesday signed an executive order on reciprocal tariffs, imposing additional ad valorem duties ranging from 10–50 per cent on imports from all trading partners. As much as 27 per cent reciprocal tariff will be imposed on India, as Trump claimed that the country imposes a 52 per cent tariff on American imports and engages in currency manipulation and non-tariff barriers.

   

The baseline duty of 10 per cent will be effective from Saturday, and the remaining country-specific additional duty will be effective from April 9.

 

“The department of commerce is carefully examining the implications of the various measures/announcements made by the President of the USA. Keeping in view the vision of Viksit Bharat, the department is engaged with all stakeholders, including Indian industry and exporters, taking feedback of their assessment of the tariffs and assessing the situation,” an official statement said, adding that the government is also studying the opportunities that may arise due to the imposition of the additional tariffs.

 

India is among countries on which Trump has imposed substantial tariffs, ranging from 46 per cent on Vietnam to 17 per cent on the Philippines, which will kick in from April 9. The rest of the world will face a uniform 10 per cent reciprocal tariff on all exports to the US, which will kick in from April 5.

 

The department further said that discussions are ongoing between Indian and US trade teams for the expeditious conclusion of a mutually beneficial Bilateral Trade Agreement (BTA). The trade deal will cover a wide range of issues of mutual interest, including deepening supply chain integration.

 

“Accordingly, the ongoing talks are focused on enabling both nations to grow trade, investments and technology transfers. We remain in touch with the Trump administration on these issues and expect to take them forward in the coming days,” the statement said.

 

According to a report released by Delhi-based think tank Global Trade Research Initiative (GTRI), imposition of higher reciprocal tariffs by the US on several Asian countries, including China, Vietnam, Taiwan, Thailand, and Bangladesh, presents an opportunity for India to strengthen its position in global trade and manufacturing.

 

“However, gains will not accrue automatically. India needs deep reforms for enabling scale production, domestic value addition and improving competitiveness to benefit.

 

With the US setting a relatively lower reciprocal tariff rate of 27 per cent on Indian goods — compared to 54 per cent on China, 46 per cent on Vietnam, 37 per cent on Bangladesh, and 36 per cent on Thailand — India gains a natural competitive advantage in several key sectors,” the report said.