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The Print
2 days ago
- Business
- The Print
No logic behind Trump's 50 pc tariff; talks continue with US: MEA official
'This is a unilateral decision. I don't think there is any logic or reason in the way it is done,' Ravi told reporters on the sidelines of the LIDE Brazil India Forum here. Negotiations between the US and India continue even after the move, Secretary, Economic Relations, Ministry of External Affairs, Dammu Ravi told reporters hours after Washington doubled the tariffs on Indian goods. Mumbai, Aug 7 (PTI) There is no logic or reason behind the Trump administration's 'unilateral' move to impose 50 per cent tariffs on Indian exports to the US, a senior Indian diplomat said on Thursday. 'Perhaps, this is a phase we have to overcome. The negotiations are still going on. So, we are confident that solutions will be found in the course of time in looking at mutually beneficial partnerships,' he said while speaking on the sidelines of an event here. US President Donald Trump on Wednesday slapped additional tariffs, apparently peeved at New Delhi's import of Russian oil. The move is likely to hit various sectors, like textiles, marine and leather exports. In its first reaction to the move, India called it 'unfair, unjustified and unreasonable'. Ravi said the Ministry of Commerce is leading the negotiation from the Indian side, and some solutions were in sight when Trump moved in with the executive order, hiking the tariffs. 'We were very close to finding a solution, and I think that momentum has taken a temporary pause, but it will continue,' he said. It can be noted that, as per plans announced earlier, a team of US officials is slated to visit India later this month for talks on a trade agreement. Ravi said India and the US have been strategic partners, having a complementary relationship for some time, and underlined that businesses and leaders on both sides are looking at trade opportunities. The high tariff will not have any detrimental impact on the Indian industry, Ravi said, stressing that it will not 'pull back' or derail India Inc. The Indian official said whenever any country faces tariff 'walls', it looks for new markets where it can trade with, and the Middle East, Latin America, Africa and South Asia are among the regions India will target. 'If the US becomes difficult to export to, you will automatically look at other opportunities,' he said. Underlining that all countries are impacted by the tariff decisions being taken by US President Donald Trump, Ravi exuded confidence that solutions will evolve for the challenges. 'This is, in my view, a temporary aberration, a temporary problem that the country will face. In the course of time, we are confident that the world will find solutions to it. Like-minded countries will look for cooperation and economic engagement that will be mutually beneficial for all sides,' he said. With 'BRICS currency' also being Trump's subject of ire, Ravi denied any move to avoid the US dollar, but added that they are seeking alternatives for bilateral trade. After Covid, there is a shortage of 'hard currency', which is resulting in moves to trade in own currency, he said, adding that work on this aspect is on bilaterally and at the BRICS levels. The political leadership of Brazil and India is conscious of the need to increase trade, Ravi said, hoping that both countries can work in a 'complementary manner'. The recently concluded BRICS Summit in Brazil, attended by Prime Minister Narendra Modi, was extremely successful, he noted. India and Brazil have a lot in common, including being credible democracies. And there are bilateral opportunities in many sectors like fossil fuels, where the South American country has the reserves and the Asian country has to manage rising demand, Ravi pointed out. Other areas where collaborations are possible include renewable energy, biofuel advances, solar, hydro and green energy. Ravi said the idea of direct cash benefit transfer, which has helped save thousands of crore in India by plugging leakages, was borrowed from Brazil. Similarly, biofuel, where India has announced a compulsory blending of some fuels, is also owed to Brazil. PTI AA BAL BAL This report is auto-generated from PTI news service. ThePrint holds no responsibility for its content.
Mint
2 days ago
- Business
- Mint
Trade war, new front: India crafts plan to skirt US duties, focuses on Africa, LatAm
India is preparing to counter stiff US tariffs by pivoting to new markets and offering incentives for exporters, even as Prime Minister Narendra Modi vows to protect the interests of the country's farmers and fishermen. The government is scrambling to mitigate the impact of the tariffs, which now total 50% on some Indian goods entering the US. The plan, which was discussed in a series of meetings with export councils and trade organizations, is to develop a strategy that doesn't involve retaliation, three people aware of the matter said. As part of the initiative, India is considering sending trade representatives to 'friendly nations" to study their markets and generate demand for Indian goods, one of the people said, speaking on the condition of anonymity. The government is also looking into setting up trade desks in underserved regions like Africa, Latin America, and Eastern Europe, which could unlock more than $60 billion in untapped export potential. New markets "These (new) markets are actively looking for reliable and cost-effective suppliers in areas where India, especially its MSMEs, holds a competitive edge—whether it is pharmaceuticals, textiles, engineering goods, agri- and non-agri machinery, processed foods or IT services," said the second person, also on the condition of anonymity. On 2 August, Mint had reported that the Centre is scrambling to revamp its export strategy as the new US tariffs hit Indian goods and favour ASEAN rivals. India now shares a 50% tariff slab with Brazil, while most other countries face lower tariffs ranging between 10% and 20%. The move comes after US President Donald Trump announced a new 25% duty on Indian goods for its continued purchase of Russian oil, adding to an existing 25% tariff. The duties are set to take effect on 27 August, leaving a window for both sides to reach an agreement. No compromise In his first public comments since the tariffs were announced, Modi said he would not compromise on the interests of India's farmers, even at a 'personal political cost." 'Today, India is ready for the country's farmers, fishermen, and dairy farmers," Modi said at a conference in New Delhi. The Prime Minister's comments signal New Delhi's position that decisions on agricultural sustainability and energy security will not be swayed by external pressure. Dammu Ravi, a top official at India's external affairs ministry, said negotiations are ongoing and that he's confident a mutually beneficial solution will be found. 'The high tariffs at this time don't discourage our industries; instead, they prompt us to explore new markets," Ravi told reporters on the sidelines of the LIDE Brazil India Forum event in Mumbai on Thursday. Threat to trade The tariffs threaten to disrupt trade flows between the two countries, which totalled $86.5 billion in Indian goods exported to the US in the last fiscal year. Sectors like textiles, engineering goods, marine products, and gems and jewellery are particularly vulnerable and could see exports fall by as much as 40% if the tariffs persist, according to analysts. In addition to seeking out new markets, the government is considering offering financial relief to exporters, the people cited above said. One option under discussion is to raise the duty drawback rate from 1% to as high as 5% to help exporters absorb the added tax burden. Another is to re-introduce the Interest Equalization Scheme (IES), which offers exporters a subsidy on interest rates to lower borrowing costs. These initiatives would be funded by a new ₹20,000 crore export promotion mission. The measures are an attempt to protect India's economic growth, which some economists fear could slip by 20 to 30 basis points to around 6.2% in the current fiscal year if the new tariffs are enacted. Growth impact 'The impact on GDP may not be dramatic, but we could see growth closer to 6.2–6.3% in FY26," said Madan Sabnavis, chief economist at Bank of Baroda. "With such exorbitant tariff rates, trade between the two nations would be virtually dead," said Madhavi Arora, an economist at Emkay Global Financial Services. "The dust will take time to settle. The trade saga is far from over. There is as much a geopolitical angle to this as an economic one. India is currently being made a scapegoat." 'While we believe a trade deal will eventually be negotiated between India and the US, we note that even nations that have cracked the US deal so far face unfavorable elevated tariffs, despite giving sweeping concessions to the US," said Arora. Diplomatic channels Despite the escalating tensions, Ravi suggested that diplomatic channels remain open. 'I don't see any logical reasoning behind the way they've been implemented—especially considering the strong strategic partnership between the US and India," Ravi said. 'Perhaps this is just a phase we need to overcome." "By diversifying our export destinations, we can reduce overdependence on traditional partners like the US and build long-term trade resilience," the second person cited above said. Queries sent to the Union commerce ministry remained unanswered. Standoff The standoff in trade negotiations with the US emerged during the second round of face-to-face talks that began on 4 June. The key point of contention between India and the US was dairy and agriculture, as first reported by Mint on 11 June. Key sectors—such as textiles ($10.91 billion), engineering goods ($19.16 billion), agriculture ($2.53 billion), gems and jewellery ($9.94 billion), leather ($948.47 million), marine products ($2.68 billion), and plastics ($1.92 billion)—could face serious trouble—Exports in these categories could fall by as much as 40% if the 50% tariff remains in place for an extended period. India exported goods worth $86.5 billion to the US in FY25, accounting for 20% of the country's total merchandise exports of $433.56 billion during the year. India's total agricultural exports to the US stood at $2.53 billion in FY25, up 19.3% from $2.12 billion in FY24. BRICS On the issue of de-dollarization by BRICS, of which India is also a member, Ravi said, 'The push for trading in national currencies isn't necessarily driven by a BRICS-level leadership decision, but more by a practical need felt across countries—especially in the Global South—post-covid, where many are facing a shortage of hard currency. So, naturally, countries are exploring alternatives to conduct trade in their own currencies." He added that this discussion has been happening bilaterally as well as within the BRICS framework. 'In fact, some countries have already begun such transactions, and we may see this expand further," he said. "The revised India-US tariff regime presents a cost hurdle for sectors like toys, stationery, homeware, and sports. It's an opportunity to become truly self-reliant, tap into India's vast domestic consumption, and strengthen ties with partner countries—while positioning India as a quality-driven, export-ready hub for design, sourcing, and production," said Shobhit Singh, MD and CEO of Stone Sapphire India Pvt. Ltd, a toys and stationery maker. 'The imposition of tariffs by the US government is not in the interest of Indian farmers. We urge the Centre not to succumb to the pressure tactics of the US government," said Joginder Singh Ugrahan, state president of Bhartiya Kisan Union (Ekta Ugrahan). Ugrahan said a joint platform of the Samyukt Kisan Morcha (SKM) and 10 central trade unions would stage a nationwide protest on 13 August against the proposed US tariffs. As India explores new trade partnerships in response to steep US tariff hikes on its exports, Prime Minister Modi on Thursday received a telephone call from Brazilian President Luiz Inácio Lula da Silva, with both leaders reaffirming their commitment to strengthen cooperation across key sectors. According to an official statement by the PMO, the two leaders recalled their meeting in Brazil last month and agreed to build on the discussions to boost collaboration in trade, technology, energy, defence, agriculture, health, and people-to-people exchanges. The call comes at a time when India is seeking to diversify export markets and reduce overdependence on traditional partners. The two sides also exchanged views on regional and global issues of mutual interest. Building on these discussions, they reiterated their commitment to take the India-Brazil Strategic Partnership to new heights, as per the statement. The leaders agreed to remain in regular contact. In response to the additional US tariffs, New Delhi on Wednesday said it would take "all actions necessary" to protect its national interests, after the US imposed an extra 25% tariff on India for continuing to import Russian oil. The move came hours after a failed US effort to end Russia's war in Ukraine. The external affairs ministry termed Washington's action as extremely unfortunate. 'We have already made clear our position on these issues, including the fact that our imports are based on market factors and done with the overall objective of ensuring the energy security of 1.4 billion people of India," it said. 'It is therefore extremely unfortunate that the US should choose to impose additional tariffs on India for actions that several other countries are also taking in their own national interest. 'We reiterate that these actions are unfair, unjustified, and unreasonable." Vijay C Roy contributed to this story.
NDTV
2 days ago
- Business
- NDTV
No Logic Behind Trump's 50% Tariff; Talks Continue With US: Official
Mumbai: There is no logic or reason behind the Trump administration's "unilateral" move to impose 50 per cent tariffs on Indian exports to the US, a senior Indian diplomat said on Thursday. Negotiations between the US and India continue even after the move, Secretary, Economic Relations, Ministry of External Affairs, Dammu Ravi told reporters hours after Washington doubled the tariffs on Indian goods. "This is a unilateral decision. I don't think there is any logic or reason in the way it is done," Ravi told reporters on the sidelines of the LIDE Brazil India Forum here. "Perhaps, this is a phase we have to overcome. The negotiations are still going on. So, we are confident that solutions will be found in the course of time in looking at mutually beneficial partnerships," he said while speaking on the sidelines of an event here. US President Donald Trump on Wednesday slapped additional tariffs, apparently peeved at New Delhi's import of Russian oil. The move is likely to hit various sectors, like textiles, marine and leather exports. In its first reaction to the move, India called it "unfair, unjustified and unreasonable". Ravi said the Ministry of Commerce is leading the negotiation from the Indian side, and some solutions were in sight when Trump moved in with the executive order, hiking the tariffs. "We were very close to finding a solution, and I think that momentum has taken a temporary pause, but it will continue," he said. It can be noted that, as per plans announced earlier, a team of US officials is slated to visit India later this month for talks on a trade agreement. Ravi said India and the US have been strategic partners, having a complementary relationship for some time, and underlined that businesses and leaders on both sides are looking at trade opportunities. The high tariff will not have any detrimental impact on the Indian industry, Ravi said, stressing that it will not "pull back" or derail India Inc. The Indian official said whenever any country faces tariff "walls", it looks for new markets where it can trade with, and the Middle East, Latin America, Africa and South Asia are among the regions India will target. "If the US becomes difficult to export to, you will automatically look at other opportunities," he said. Underlining that all countries are impacted by the tariff decisions being taken by US President Donald Trump, Ravi exuded confidence that solutions will evolve for the challenges. "This is, in my view, a temporary aberration, a temporary problem that the country will face. In the course of time, we are confident that the world will find solutions to it. Like-minded countries will look for cooperation and economic engagement that will be mutually beneficial for all sides," he said. With 'BRICS currency' also being Trump's subject of ire, Ravi denied any move to avoid the US dollar, but added that they are seeking alternatives for bilateral trade. After Covid, there is a shortage of 'hard currency', which is resulting in moves to trade in own currency, he said, adding that work on this aspect is on bilaterally and at the BRICS levels. The political leadership of Brazil and India is conscious of the need to increase trade, Ravi said, hoping that both countries can work in a "complementary manner". The recently concluded BRICS Summit in Brazil, attended by Prime Minister Narendra Modi, was extremely successful, he noted. India and Brazil have a lot in common, including being credible democracies. And there are bilateral opportunities in many sectors like fossil fuels, where the South American country has the reserves and the Asian country has to manage rising demand, Ravi pointed out. Other areas where collaborations are possible include renewable energy, biofuel advances, solar, hydro and green energy. Ravi said the idea of direct cash benefit transfer, which has helped save thousands of crore in India by plugging leakages, was borrowed from Brazil. Similarly, biofuel, where India has announced a compulsory blending of some fuels, is also owed to Brazil.
Time of India
2 days ago
- Business
- Time of India
US-India trade row: MEA official calls Donald Trump's tariff hike a ‘unilateral decision'; says both sides were ‘very close to a solution'
US President Donald Trump (AI image) A senior Indian diplomat on Thursday criticised the Donald Trump administration's imposition of 50 per cent tariffs on Indian exports to the US, calling the move 'unilateral' and lacking any 'logic or reason', even as he confirmed that bilateral trade negotiations between the two sides would continue. 'This is a unilateral decision. I don't think there is any logic or reason in the way it is done,' said Dammu Ravi, secretary (economic relations), ministry of external affairs, speaking to reporters on the sidelines of the LIDE Brazil India Forum in Rio de Janeiro, as quoted by news agency PTI. The remarks came hours after US President Donald Trump signed an executive order doubling import tariffs on Indian goods to 50 per cent, citing New Delhi's continued imports of discounted Russian oil as the reason. The move is expected to severely affect key sectors like textiles, marine products, leather, and chemicals. In its first official reaction, India called the move "unfair, unjustified and unreasonable", according to government sources. Despite the escalation, Ravi indicated that India would continue to engage diplomatically. "Perhaps, this is a phase we have to overcome. The negotiations are still going on. So, we are confident that solutions will be found in the course of time in looking at mutually beneficial partnerships," he said. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like Option Trading: Mr. Gopal Reveals His Powerful Laxman Rekha Strategy For Free TradeWise Learn More Undo According to Ravi, India's ministry of commerce is leading the discussions with the US, and talks had made significant headway before the tariff hike was announced. 'We were very close to finding a solution, and I think that momentum has taken a temporary pause, but it will continue,' he added. A US delegation is expected in India later this month for the sixth round of talks on a proposed bilateral trade agreement (BTA). The two countries are hoping to conclude the first phase of the BTA by October–November. Downplaying the long-term impact of the tariffs, Ravi said Indian industry was resilient and would not be derailed by the new duties. 'The high tariff will not have any detrimental impact on the Indian industry. It will not pull back or derail India Inc,' he asserted. Ravi noted that countries often look for alternative markets when faced with tariff 'walls', and said India would now turn its attention to geographies such as the Middle East, Latin America, Africa and South Asia. 'If the US becomes difficult to export to, you will automatically look at other opportunities,' he said. Describing Trump's move as a "temporary aberration", Ravi expressed optimism that the situation would stabilise with time and dialogue. 'This is, in my view, a temporary aberration, a temporary problem that the country will face. In the course of time, we are confident that the world will find solutions to it. Like-minded countries will look for cooperation and economic engagement that will be mutually beneficial for all sides,' he said. Ravi also addressed concerns about the growing global momentum toward de-dollarisation. Though he denied any deliberate move to bypass the US dollar, he said many countries were now seeking alternatives for bilateral trade due to a shortage of hard currency post-Covid. 'Work on this aspect is on bilaterally and at the Brics level,' he noted. Trump's executive order, 'Addressing Threats to the US by the Government of the Russian Federation', imposes an additional 25 per cent tariff on Indian goods over and above the existing 25 per cent levy. The first layer of duties takes effect from August 7, with the additional 25 per cent kicking in from August 27. India currently imports around 88 per cent of its crude oil needs, and Russian oil, available at a discount after the Ukraine war, has become the country's largest source. As of July, 1.6 million barrels per day of India's 5 million bpd crude imports came from Russia. The new US duty would make India the highest-taxed exporter to the US (at 50 per cent), alongside Brazil. In comparison, tariffs on similar goods from competitors like Bangladesh (35 per cent), Vietnam (20 per cent), and China (30 per cent) remain significantly lower. Trade experts believe the tariff hike is a pressure tactic by the US ahead of the ongoing BTA negotiations. Washington is seeking duty concessions on electric vehicles, dairy, wines, petrochemical products, apples, tree nuts, genetically-modified crops, and more. In 2024–25, bilateral trade between India and the US stood at $131.8 billion, with Indian exports accounting for $86.5 billion. Despite the tensions, Ravi emphasised the strategic nature of the India-US partnership. 'We have a complementary relationship. Businesses and leaders on both sides are looking at trade opportunities,' he said. Stay informed with the latest business news, updates on bank holidays and public holidays .
Mint
3 days ago
- Business
- Mint
India says negotiations on with US amid Donald Trump's 50% tariff hike; calls it a ‘phase we have to overcome'
India has sharply criticised the United States' unilateral decision to impose 50% tariffs on its exports, calling the move 'unfair, unjustified and unreasonable'. After US President Donald Trump signed the executive order doubling duties on Indian goods, senior Indian diplomat Dammu Ravi labelled the move illogical and unprovoked. 'This is a unilateral decision. I don't think there is any logic or reason in the way it is done,' said Ravi, Secretary of Economic Relations at the Ministry of External Affairs. Speaking on the sidelines of the LIDE Brazil India Forum, Ravi expressed hope that the decision would eventually be reversed through ongoing dialogue. Despite the escalation, Ravi confirmed that trade negotiations between the two countries remain active. 'We were very close to finding a solution, and I think that momentum has taken a temporary pause, but it will continue,' he noted. The Indian Ministry of Commerce is leading the discussions, with a team of US officials expected to visit India later this month. Ravi framed the current dispute as a 'temporary aberration' and insisted that India would not be deterred. 'The high tariff will not pull back or derail India Inc. If the US becomes difficult to export to, we will automatically look at other opportunities,' he said, naming the Middle East, Latin America, Africa and South Asia as potential new markets. Washington has suggested that Donald Trump's latest tariff hike was fuelled by New Delhi's continued purchase of Russian oil — a decision that has irked the US administration. The new tariffs are expected to severely impact key Indian exports such as textiles, leather, and seafood. Nevertheless, Ravi emphasised the strategic importance of US-India ties, describing the two nations as 'complementary partners' in trade. 'Our businesses and leaders continue to seek economic cooperation,' he said. Donald Trump has also criticised discussions around the use of a BRICS currency, raising questions about whether India is seeking alternatives to the US dollar in bilateral trade. Ravi clarified that while there is no intention to avoid the dollar, 'there is a shortage of hard currency post-Covid, and countries are exploring ways to trade in their own currencies.' He said work is ongoing both bilaterally and at the BRICS level to enable such arrangements, but denied any formal pivot away from the dollar. The timing of Ravi's comments is significant, coming just days after the BRICS Summit in Brazil, which was attended by Prime Minister Narendra Modi. Ravi highlighted the 'extremely successful' outcomes of the summit, especially in deepening Brazil-India ties. He pointed out common ground between the two democracies and noted opportunities for collaboration in fossil fuels, renewables, solar energy, and biofuels. Interestingly, Ravi acknowledged that India's direct benefit transfer scheme — which has saved crores by eliminating middlemen — was inspired by Brazil. 'We have a lot to learn from each other, and this partnership can be truly complementary,' he said. Despite the current friction, India remains hopeful that pragmatic diplomacy will prevail. 'This is a phase we have to overcome,' Ravi concluded. With both sides still in talks and a shared desire for a strong economic relationship, the coming weeks could prove decisive for the future of one of the world's most important bilateral partnerships.
