Trump Signals US-India Trade Deal! Will India Get Tariffs Rolled Back First?

US President Donald Trump has indicated his intention to lower tariffs on India in the future, acknowledging that past trade policies had strained bilateral relations. He remarked that a trade deal is "pretty close" to being finalized.

However, Ajay Srivastava, founder of the Global Trade Research Initiative (GTRI), suggests India should strategically push for the rollback of a 25% tariff on Russian crude oil before concluding any trade agreement. GTRI proposes a three-point strategy for India: first, finalize the withdrawal from trading sanctioned Russian oil, which Trump has acknowledged India has largely done. Second, secure the reversal of the 25% "Russian oil" tariff by Washington to enhance market access and boost the competitiveness of Indian sectors like textiles, gems and jewellery, and pharmaceuticals. Third, resume balanced trade negotiations as equals once these duties are reduced.

Additionally, GTRI points out that India could benefit from waiting for the US Supreme Court's verdict on "Trump tariffs." If the court invalidates these tariffs, India would be in a stronger position for negotiation.

The status of the trade negotiations, which have involved multiple rounds of official discussions, appears to be nearing conclusion, with Indian officials stating that additional rounds are unlikely as the ball is now in the US's court. Commerce and Industry Minister Piyush Goyal reiterated India's aim for a fair, equitable, and balanced trade deal.

Impact This news could positively impact the Indian stock market by signaling improved trade relations and potentially boosting export-oriented sectors. Lower tariffs would make Indian goods more competitive, leading to increased demand and potential revenue growth for affected companies. A successful trade deal could also improve overall investor sentiment towards India. Rating: 7/10

Difficult Terms: Tariffs: Taxes imposed by a government on imported goods. Russian crude oil: Petroleum extracted from the ground in Russia. Sanctioned Russian oil: Oil originating from Russian entities or sectors that are subject to international penalties or trade restrictions. GTRI (Global Trade Research Initiative): An independent organization that analyzes and researches global trade policies and trends. Penal tariff / Russian oil duty: An additional, punitive tax specifically applied to imports of Russian oil. Market access: The ability of a company or country to sell its products or services in a foreign market. WTO-compliant treaty: A trade agreement that adheres to the rules and principles established by the World Trade Organization, ensuring fair trade practices. International Emergency Economic Powers Act (IEEPA): A U.S. law that grants the President broad authority to regulate international commerce during emergencies. Unilateral duties: Tariffs imposed by one nation without reciprocal agreement from trading partners.