New Delhi: India has already reduced tariffs for key trade partners such as the UAE, Australia, and Switzerland, and it is premature to discuss tariff cuts in an Indo-US trade deal, government sources said on Saturday. The statement comes hours after US President Donald Trump claimed that India agreed to lower tariffs on American products.
Negotiations for a trade agreement between India and the US are in their early stages, and discussions are ongoing, the sources said. “Since the discussions have just begun, it would be premature to talk about its details. There is also a context for each dimension that would reflect the interests of both sides,” PTI quoted a source as saying.
Last month, Prime Minister Narendra Modi and President Trump agreed to initiate talks on a multi-sector Bilateral Trade Agreement (BTA) by the fall of 2025. Followed by Commerce Minister Piyush Goyal’s visit to the US from March 3 to 6 to carry forward the discussions on the trade deal with his American counterpart and US Trade Representative officials.
On Friday, Trump asserted that India had agreed to significantly lower tariffs on American imports. “India charges us massive tariffs, you can’t even sell anything in India, it’s almost restrictive… By the way, they have agreed to cut their tariffs way down now because somebody is finally exposing them for what they have done,” Trump told reporters at the White House.
Responding to Trump’s remarks, Foreign Secretary Vikram Misri declined to provide specifics, citing the ongoing nature of the discussions. “I will not get into that at this point of time because these are ongoing discussions, so it would not be right to get into it,” he said.
Misri, however, pointed out that India has been engaged in tariff liberalisation under multiple bilateral trade agreements. “There are ongoing discussions with several other partners on these issues now, and I think the ongoing discussions should be seen in that context as well,” he added.
During Trump’s first term, India and the US had explored a limited trade deal, but it did not materialize. The sources highlighted that India’s recent trade agreements with countries such as Australia, the UAE, and Switzerland had resulted in tariff reductions. Similar negotiations are currently underway with the European Union and the UK.
India has not directly commented on Trump’s announcement of reciprocal tariffs but has reiterated its commitment to strengthening trade ties with the US. “Our objective through the BTA is to strengthen and deepen India-US two-way trade across the goods and services sector, increase market access, reduce tariff and non-tariff barriers, and deepen supply chain integration between the two countries,” External Affairs Ministry spokesperson Randhir Jaiswal said on Friday.
Since assuming office on January 20, Trump has repeatedly criticized India’s tariff policies, labeling the country a “tariff king.” In its Union Budget for 2025-26, India announced tariff reductions on Bourbon whiskey, wines, and electric vehicles, signaling its willingness to lower trade barriers in specific sectors.
The US has been pushing India to increase purchases of American oil, gas, and military platforms to reduce the trade deficit, which currently stands at around $45 billion in India’s favor. The US was India’s largest trading partner in 2023, with bilateral trade in goods and services reaching $190 billion. Additionally, the US was the third-largest source of foreign direct investment (FDI) into India in 2023-24, with inflows of $4.99 billion.
(With PTI inputs)
