India looks to replace Chinese imports with U.S. goods as Trump’s tariffs loom
NEW DELHI : The Ministry of Commerce and Industry has told India Inc. to come up with ideas where imports from China and other nations can be replaced by U.S. goods, according to a report. This comes as reciprocal tariffs announced by U.S. President Donald Trump are set to take effect April 2, 2025.
India and the U.S. have agreed that to begin negotiations to address long-running disparities that should have been taken care of over the last four years. “We want a certain level playing field which we thing we are entitled to and he does also in fairness,” Trump had said.
“It’s very hard to sell in India because they have trade barriers and very strong tariffs. We are now a reciprocal nation. Whatever India charges, we are going to charge them,” Trump had warned.
The U.S. president had said a new trade deal will pave the way for more oil and gas exports from the U.S. to India. “We are going work on that very hard and we can make up the difference very easily with the deficit with the sale of oil and gas LNG which we have more than anybody in the world,” he had said.
The White House had earlier cited India as an example where U.S. trading partners do not give the world’s largest economy reciprocal treatment. “The U.S. average applied Most Favoured Nation (MFN) tariff on agricultural goods is 5%. But India’s average applied MFN tariff is 39%,” it said.
Trump’s “Fair and Reciprocal Plan” seeks to correct longstanding imbalances in international trade and ensure fairness across the board.
According to Moody’s, India has a lower overall exposure relative to most others in the Asia Pacific region, although certain sectors such as food and textiles, as well as pharmaceutical products face risks. Indian steel producers also face increased challenges in exporting their products after Trump announced plans to impose 25% tariffs on steel and aluminium imports.
In 2024, India exported $87.4 billion worth of goods to the U.S. while the world’s largest economy exported $41.8 billion worth of goods to India, according to the United States Trade Representative (USTR). U.S. goods trade deficit with India was $45.7 billion in 2024, a 5.4% increase over 2023.
Source : Indian Express