WASHINGTON: US President Donald Trump, while speaking at a joint session of Congress on Tuesday, announced imposition of ‘reciprocal tariffs’ from April 2.
This leaves India with less than four weeks to decide and, if need be, adjust the levy of customs and duties it imposes on US goods entering India. Else, the Trump administration will impose equal tariffs on Indian goods entering the US.
New Delhi has set up a committee that is studying the impact of reciprocal tariffs on the India-US trade. The committee under the Ministry of Commerce represents ministries of agriculture, food processing, industry, heavy industry, electronics and IT.
In February, after a bilateral meeting between Trump and Prime Minister Narendra Modi in Washington, the two countries had agreed to negotiate the first tranche of multi-sector bilateral trade agreement by October this year.
Modi and Trump had also announced ‘Mission 500’, targeting a bilateral trade of $500 billion by 2030.
Meanwhile, Trump in his speech at the joint session of Congress pointed to India’s high tariff rates, saying, “India charges us tariffs, 100 per cent. The system is not fair to the US, it never was.”
“Other countries have used tariffs against us for decades, and now it’s our turn to start using them against those other countries,” Trump declared, reinforcing his America First approach.
Under the policy of reciprocal tariffs, the US plans to impose equivalent tariffs on countries that levy high duties on American goods. Trump explained, “Whatever they tariff us, we will tariff them. Whatever they tax us, we will tax them. If they use non-monetary barriers to keep us out of their market, we will do the same.”
The new tariffs, which will target a wide range of imports from key trading partners including Canada, Mexico, China, the European Union and India, are part of Trump’s broader push to overhaul US trade policies. He argued that countries have long imposed higher duties on American products while benefiting from lower US tariffs, creating an uneven playing field.
Trump’s push for reciprocal tariffs is in line with his long-standing belief that global trade rules disadvantage the US. During his first term, his administration considered similar measures but did not fully implement them. The new tariffs will be applied on a country-by-country basis, considering not just tariff rates but also non-tariff barriers like subsidies and regulatory hurdles.