India to Keep Engaging with US on Trade Deal After New Tariff Measures

India intends to pursue a bilateral trade agreement with the United States, signaling a commitment to ongoing engagement despite new U.S. tariff measures.

Washington recently imposed a 10% tariff on a range of goods from India and 59 other trading partners. The U.S. administration stated these duties are a response to countries allegedly failing to curb imports made with forced labor. However, the tariff rate on India is lower than initially proposed in June and notably excludes critical sectors such as generic pharmaceuticals, smartphones, steel, aluminum, and auto parts, according to India's commerce ministry.

The Indian government affirmed its dedication to resolving sector-specific issues, including textiles, within the framework of the bilateral trade pact negotiations. These discussions have been ongoing since last year, with both nations seeking to strengthen economic ties and address long-standing market access challenges.

Approximately 45% of India's exports to the U.S. will remain exempt from the new tariffs. The remaining 55% will be subject to the 10% duty, which is levied in addition to existing U.S. most-favored-nation tariffs. Indian textile and apparel exporters, however, may face disadvantages compared to some Asian competitors under this new regime.

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The government remains committed to working with the United States towards the early conclusion of the India-US Bilateral Trade Agreement.