New Delhi: An Indian government official, citing ongoing negotiations for a trade agreement between India and the United States, stated that India does not intend to respond to President Donald Trump’s 26 percent tariff on imports from India, as reported by Reuters.
The official, who requested anonymity due to the confidential nature of the discussions, mentioned that Prime Minister Narendra Modi’s administration is examining a provision in Trump’s tariff directive that may provide relief for trading partners that “take significant steps to remedy non-reciprocal trade arrangements.”
In a strategic move to position itself ahead of regional competitors, New Delhi recognizes the benefit of being among the first countries to initiate trade discussions with Washington. This places India in a more favorable position compared to other Asian nations like China, Vietnam, and Indonesia, which have been adversely affected by the increased US tariffs, according to a second unnamed government official.
India has joined countries such as Taiwan and Indonesia in opting against implementing counter tariffs following Trump’s tariff announcement, which has significantly unsettled global markets. This decision comes even as the European Commission prepares to impose additional duties on US products in response to China’s countermeasures.
To address the tariff dispute, India and the US reached an agreement in February to finalize a trade deal by autumn 2025.
The Prime Minister’s office did not provide an immediate response to an emailed request for comments regarding this matter.
In an effort to alleviate trade tensions, Modi’s government has made various concessions to the US, including reducing tariffs on premium motorcycles and bourbon, as well as eliminating a digital services tax that had affected American technology companies.
Economists caution that Trump’s tariffs could potentially reduce India’s economic growth by 20 to 40 basis points in the current financial year and could adversely impact the diamond industry, which exports over a third of its products to the US, thereby jeopardizing thousands of jobs.
