The Commerce & Industry Ministry is working on improved offers for import tariff cuts for the US to be tabled in the next round of consultations with Washington DC as the initial proposals discussed by Commerce & Industry Minister Piyush Goyal last week with his counterparts were considered inadequate by the Americans, sources have said.
“There is a possibility that Goyal may visit the US again soon with improved offers based on the feedback he received from his counterparts in Washington DC last week. A clear message was given that the US wanted much more than what India had in mind initially. India needs to make stronger offers before April 2, when US President Donald Trump has threatened countries with reciprocal tariffs,” a source tracking the matter told businessline.
Goyal and his team of officials are in intense consultations with other ministries and departments, including agriculture, on the extent of market openings that the industry and farm sector can handle. They are also scheduled to hold discussions with industry bodies on Thursday, the source said.
“While the first tranche of negotiations on the proposed India-US bilateral trade agreement (BTA) is unlikely to be completed before September this year, the idea is to try and appease the US by making good initial offers so that reciprocal tariffs are not applied on India on April 2,” the source said. A list of demands from the Indian industry is also being prepared.
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The US wants steep concessions in almost all areas and wants agricultural products, too, `on the table’.
“While India is ready to offer market access in labour intensive sectors such as textiles, leather, footwear, chemicals and also some other products like electronics and automobiles, the US wants wider and deeper concessions,” the source said.
The industry meetings will largely focus on how India could improve on its initial proposal by offering more cuts and covering more products.
India’s tariffs on US goods stood at a much higher 15.30 per cent (2022) compared to US tariffs on Indian products at around 3.83 per cent, according to a recent report by the SBI Economic Research Department.
Since India’s exports to the US, estimated at $77.51 billion in FY24, are about $35 billion higher than its imports from the country at $42.19 billion, Trump has raised concerns over the US trade deficit.
He has been saying that India’s “very high tariffs” were unfair for the US industry and must be brought down.
US Commerce Secretary Howard Lutnick told the Indian media late last week that the US expected a “macro, large scale, broad-based trade agreement”, that would also include agriculture.
“It is time to do something big, something grand. Something that connects India and US together. Something broad scale, not product by product. Let us bring India’s tariff policy towards America down. And America will invite India in to have an extraordinary opportunity and relationship with us,” he said.
Agriculture is a highly sensitive sector for India as it involves the livelihoods of millions of vulnerable farmers. The Commerce Ministry has indicated that while there is scope to reduce tariffs on items such as nuts, the dairy sector would largely remain untouched.