The four-day India-US trade talks in New Delhi concluded on Saturday with the two sides deciding the pathway for further talks. However, no clarity emerged on the issue of reciprocal tariff as Commerce Ministry officials remained tight-lipped on the issue. A statement by the Ministry of Commerce and Industry said that sectoral expert level engagements under the Bilateral Trade Agreement (BTA) will start virtually in the coming weeks.
A Commerce Ministry official told TNIE that the two sides had a good discussion on the way forward for talks. “A lot of issues got clarified between the two sides. Pathway for further talks has been decided,” said the official. He, however, refused to answer questions on the issue of reciprocal tariff, saying that he was not part of those discussions.
According to a statement by the Ministry of Commerce and Industry, in order to realize the shared objective of promoting growth that ensures fairness, national security and job creation, both sides have through four-days of discussions in New Delhi broadly come to an understanding on the next steps towards a mutually beneficial, multi-sector Bilateral Trade Agreement (BTA), with the goal to finalize its first tranche by fall 2025.
During these discussions, the two sides also had a productive exchange of views on deepening bilateral cooperation in priority areas including increasing market access, reducing tariff and non-tariff barriers and deepening supply chain integration in a mutually beneficial manner.
The meeting in New Delhi follows the visit of Union Commerce and Industries Minister Piyush Goyal to Washington, DC from 4-6 March 2025 during which he met his US counterparts – US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick and subsequent video conferences between the two sides.
According to the Commerce Ministry, the successful conclusion of the discussions reflects progress in efforts to expand India-US bilateral trade and investment relations to promote prosperity, security and innovation in both the countries.
“These steps are designed to unlock new opportunities for businesses, drive bilateral economic integration, and reinforce the economic partnership between India and the United States,” said the statement.
Reciprocal tariff: A stumbling block
Despite the ongoing talks on Bilateral Trade Agreement, Commerce Ministry officials have maintained that India is not discussing the issue of reciprocal tariff with the US, and is focusing only on achieving the goal set for BTAs.
As a follow up to the India-US Joint Statement of 13 February 2025, wherein the two sides agreed to expand bilateral trade to reach $ 500 Billion by 2030, including through the conclusion of a Bilateral Trade Agreement.
The US has set the deadline of 2 April for implementation of reciprocal tariff, under which it will impose import duties on goods similar to what are being imposed by other countries on goods imported from the US.
The Indian government has so far not hinted at actively looking at countering the US on the reciprocal tax. Instead it has asked the exporters to be ready to deal with the emerging situations. In an address to the export promotion council recently, Minister of Commerce & Industry Piyush Goyal asked exporters to come out of their protectionist mindset and encouraged them to be bold and ready to deal with the world from a position of strength and self-confidence.
If the US goes ahead with its plan to impose reciprocal tax, exports of most goods from India could face higher tariff. As per an estimate by Emkay Global, India could potentially lose $6 billion in exports to the US (at 10% broad tariffs) and $31 billion at 25% tariffs.
According to an analysis by Global Trade Research Initiative (GTRI), US goods face a weighted average tariff of 7.7% in India, while Indian exports to the U.S. face only 2.8%, leading to a 4.9% difference.
Indian farm exports could be the worst hit with shrimp, dairy, and processed foods facing tariffs of up to 38.2%. Sectors like pharmaceuticals (with additional 10.9% tariff possibilities), diamonds & jewellery (13.3%), and electronics (7.2%) are the other worst-hit sectors.