The government has assured the industry that it is working overtime to ensure that no adverse action is taken against India’s exports in the US. But the country cannot be protectionist at a time when the world was moving towards reciprocity, sources said.
One of the important points that emerged from a brainstorming meeting between Commerce & Industry Minister Piyush Goyal and various export promotion councils and industry organisations on Thursday was that India could consider importing from the US many of the items that were being imported from China, a source tracking the meeting told businessline.
“It was a very positive meeting between the government and the industry. The Commerce Minister gave an assurance that the government was focussed on protecting the interests of exporters while the industry recognised that protectionism will not work. A lot of brainstorming happened on how to give US greater market access with the least impact to Indian industry,” the source said.
Trump tariff
US President Donald Trump has threatened countries that have high import tariffs on US goods with reciprocal tariffs that are scheduled to be announced on April 2. India is in talks with the US for a “mutually beneficial” bilateral trade agreement and is trying to avoid tariffs by working out good market opening offers for the country.
India’s tariffs on US goods are a higher 15.30 per cent (2022) than US tariffs on Indian products at around 3.83 per cent. India’s average applied agriculture tariffs are at around 39 per cent.
- Also read: US steel tariffs: India may hold off retaliation, hopes bilateral trade pact brings relief
There was a lot of interest from the government in the industry’s suggestion that greater market access could be offered to the US in some of the products that were being imported in substantial quantities from China which included polymers, plastics, chemicals and some engineering items. “The idea is to replace some Chinese imports with American goods,” the source said.
Labour intensive sectors such as textiles, garments, handicrafts, leather and also some chemicals are eager to gain more market access in the US for their products and are ready to lower tariffs together with the US. “Some sectors are also open to a zero-for-zero tariff situation where both sides will bring down tariffs to zero giving unhindered access to each other’s markets,” the source said.
On agriculture
Discussion on agriculture, too, would happen separately with stakeholders as this meeting focussed largely on industry, the source added. The US also wants access to India’s agriculture market and that is troublesome for the country as it is an area with high sensitivity.
The US was India’s largest trading partner in FY24 with exports worth $77.51 billion and imports worth $42.19 billion. India’s imports from China were more than double the US at $101.7 billion.
