Trade Deal
India plans trade deal with US to avoid Trump's tariff action, says govt source
This story was originally published at 20:50 IST on 3 January 2025
Register to read our real-time news.Informist, Friday, Jan. 3, 2025
By Krity Ambey
NEW DELHI – India is preparing to propose a trade deal with the US to avoid possible tariff action after Donald Trump takes over as US president later this month, a government official said. Trump has threatened to impose high tariffs on all countries that have a trade surplus with the US, including India.
India had a trade surplus of $35.32 billion with the US in 2023-24 (Apr-Mar). Last month, Trump emphasised his plan to implement reciprocal tariffs in response to "high tariffs" that India imposes on specific American goods.
The government is currently working on a proposal for a trade deal with the US that may be advantageous to both sides, the official said. "We hope to propose a lucrative deal to Trump that may benefit both sides." It is unlikely to be a Free Trade Agreement, but it may cover some sectors, like expensive medical equipment, according to the official.
Several other countries — China, Canada, Mexico – are also on Trump's radar, and his focus would most likely be on China for the first three months at least, the official said. Trump is set to take charge as US president on Jan. 20.
As the US plans to impose high tariffs on China, India would also focus on integrating into the supply chains and replacing China, the official said. According to the Federation of Indian Export Organisations, US tariff action on China can open an additional export opportunity of around $25 billion for India.
Some of the sectors where India could leverage the opportunity are electronics and electricals, automotive components, organic chemicals, apparel and textiles, footwear, furniture and home decor, and toys, FIEO said last week. India's merchandise trade with the US was $119.71 billion in FY24, which included exports worth $77.52 billion.
On Friday, Commerce Minister Piyush Goyal said India was looking forward to a deep and substantive engagement with the Trump administration in the US. The Narendra Modi government has worked with the Trump administration in the past, Goyal said, adding that the "relation has only improved over the years." End
US$1 = INR 85.77
Edited by Saji George Titus
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (11) 4220-1000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
