India has given a clear signal to the US through its statement on April 2 that it does not want to engage in retaliation and instead wants to expedite BTA talks
| Photo Credit:
Eduardo Munoz
India is focussing on fast-tracking internal decision-making on duty cuts for American goods as part of the proposed India-US bilateral trade agreement (BTA), as it views the pact as the best way of dealing with Trump’s reciprocal tariff fixed at 26 per cent for the country, sources said.
US President Donald Trump’s recent statement that he is ready to negotiate with other countries if they offered something “phenomenal” gives hope to New Delhi, as it has already started the negotiating process for such a pact with the US. However, some experts caution that India should not give in to demands in sensitive areas, such as core agriculture, and hold its ground.
“India has given a clear signal to the US through its statement on April 2 that it does not want to engage in retaliation and instead wants to expedite BTA talks. It is already in an advantageous position compared to others as talks are already on. The focus will be on speeding up internal decisions,” an official told.
Trump announced sweeping tariffs on goods from across the world on April 2, with a baseline tariff of 10 per cent and more on “high-tariffing” countries, to end “years of unfair trade practices” and make America wealthy again. Economists have warned that this would lead to inflation in the US, a fall in demand and a possible global trade war.
In India, the 26 per cent tariffs are set to hit exports from sectors such as gems & jewellery, engineering products, agricultural goods, textiles, shrimps and chemicals.
Last week, top officials from India and the US discussed the contours of a mutually beneficial BTA and sectoral meetings are to start soon, the Commerce Department had said. Both sides want the first tranche of the BTA to be delivered by Fall of 2025.
The US has indicated that it wants tariff cuts in several areas, such as agriculture, automobiles, medical equipment and alcohol, but economists say that India must draw the line wherever needed.
“India needs to negotiate from a position of strength as it has its huge market to offer. We must stop giving the US concessions outside the pact. And in sensitive areas like core agriculture, such as cereals, India must draw the line and say that concessions can’t be given come what may,” said Biswajit Dhar, Distinguished Professor, Council for Social Development.
Published on April 4, 2025
