India offers ‘deep cuts' on tariffs as talks with US proceed

Russia Today

28-05-2025

India has proposed deep cuts in import tariffs on various goods, in an effort to reach a preliminary trade agreement with the US, the Financial Times reported on Wednesday. However, the country reportedly aims to maintain high tariffs on sensitive agricultural products, such as grains and dairy items.
India is seeking to secure a deal before July 9, when the US has threatened to impose a 26% reciprocal tariff on all Indian goods. Sources familiar with the negotiations told the FT that India has shown willingness to cut tariffs on less sensitive farm products such as almonds, which currently face tariffs of up to 120%. It could also consider reducing tariffs on imported oil and gas, which range from 2.5 to 3%, the report said.
The FT's sources declined to provide details on the range of US goods which New Delhi offered to 'substantially' cut tariffs on, as the negotiations were at an 'early stage.' Indian trade officials have hinted, however, that any concessions would be similar to those offered in recent trade agreements, such as the one they have with the UK, in which India agreed to reduce tariffs on items such as alcoholic spirits, cars – including electric vehicles – car parts, and engineering goods.
On Tuesday, India said that a successful trade agreement with the US could 'flip current headwinds into tailwinds,' according to a report by the Finance Ministry's Monthly Economic Review. This can 'open up new market access and energize exports,' the report added.
The US introduced an additional tariff on Indian products, effective April 2, but it was suspended for a 90-day period, and is set to expire on July 9. Meanwhile, the standard 10% US tariff on Indian goods remains in places.
US President Donald Trump has called India the 'tariff king.' In February, New Delhi announced a reduction in customs duties on items including luxury cars and solar cells, according to reports, in a move seen as aimed at addressing US trade concerns.
India's federal budget for 2025 proposed reducing the peak import tariff from 150% to 70% and average tariffs from 13% to below 11%. India is also willing to buy US defense equipment and liquefied natural gas, government officials said. However, despite this, the US has advised companies such as Apple to avoid expanding manufacturing in India.