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Tariff announcement
The surprise announcement by Trump is being seen in some quarters as a ploy to extract more concessions in the trade negotiations. Despite the announcement of unilateral tariffs, both sides remain engaged in concluding the first tranche Bilateral Trade Agreement (BTA) by the autumn of 2025. The negotiations that started in end-March have gone through five rounds and the sixth one is expected from August 25.
“The government attaches the utmost importance to protecting and promoting the welfare of our farmers, entrepreneurs, and MSMEs,” the ministry said.
Experts POV
Experts say that this is unlikely not the last word from Trump on the matter and that they would wait for a while. They pointed out that when the US was negotiating a trade agreement with the European Union (EU) the President had threatened a 30% tariff on the 27-member economic bloc. As talks progressed the tariffs were brought down to 21% during the negotiations and the deal was finalised at 15%. At one point in May when the progress with the EU was stuck, Trump had even threatened a 50 tariff % on EU’s exports.
“While Trump’s announcement appears harsh, a closer look shows that India is not significantly worse off than countries that did sign deals with the US. The UK, EU, Japan, Indonesia, and Vietnam now face elevated tariffs, and in return, have given sweeping concessions—zero tariffs on U.S. farm goods, massive investment pledges, and purchases of US oil, gas, and arms. India has made no such concessions,” founder of Global Trade Research Initiative (GTRI) Ajay Srivastava said.
For climbing down on tariffs, Trump got zero duty access for manufacturing exports from the US to EU. He also secured a commitment from the EU to buy $ 750 billion worth of energy and investment of $ 600 billion in the US.
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Another trade official said the first move by the US takes pressure off on India to agree to some of the more onerous demands for a trade deal that include concessions on agriculture and dairy sectors. Apart from tariffs, the US has demands of greater regulatory space for its companies in India and more stringent patent laws for the pharma sector.
“India is not alone; over 90 countries face similar US pressure. A deal may still emerge, but only on fair terms. For now, India’s principled stand has avoided the trap of a one-sided deal—and that’s a success,” Srivastava said.