US Commerce Secy optimistic about India-US Trade ties, urges New Delhi to bring tariffs down
NEW DELHI : US Commerce Secretary Howard Lutnick on Friday expressed optimism about India-US Trade ties, emphasizing the need for India’s agricultural trade to open up amid US President Donald Trump’s plans to impose reciprocal tariffs on US trading partners, including India.
Speaking virtually at the India Today Conclave, Lutnick acknowledged that finding a mutually beneficial solution would require understanding and cooperation from both sides.
He said India’s agricultural trade cannot just remain closed, and suggested that it can be smarter while dealing with the most “important trading partner” US on the other side of the table. He also suggested that India needs to lower its tariffs, calling it crucial for forging an “extraordinary relationship” between the two nations.
On America pushing India to reduce duties on agriculture goods, Lutnick commented that the US is keen on establishing a comprehensive, large-scale trade agreement with India that encompasses all key aspects and urged both nations to engage in direct bilateral discussions to reshape their trade dynamics.
“Indian market for agriculture has to open up, it cannot just stay closed. How you do that and the scale by which you do that, maybe do limits, you can be smarter when you have your most important trading partner on the other side of the table. Maybe certain products have quotas and limits and we do the same thing on the other side and we graft an agreement that is sensible between the two sides,” he told India Today.
The Secretary was asked whether some of what America has been pushing for, for example, lowering the import duty on some agricultural products, would be politically suicidal for Prime Minister Modi if he ever went down that route. How does America look at the sensitivity?
“The good thing is your government truly understands your market, and we understand ours. And the key is to try to find that place. So yes, the Indian market for agriculture, it has to open up,” he responded.
“It can’t just stay closed. Now, how you do that and the scale by which you do that, maybe you do quotas, maybe you do limits. You can be smarter when you have your most important trading partner on the other side of the table,” he added.
Lutnick suggested that India could adopt smarter strategies, such as quotas or limits, to open up its agricultural market. He emphasized the importance of putting everything on the table and negotiating thoughtfully to craft a sensible agreement.
“Maybe certain products have quotas. Maybe certain products have limits. Maybe certain products you do in certain ways. And then we do the same thing on the other side and we craft an agreement that is sensible between the two of us,” he further said.
Concerning concerns that tariffs would be inflationary for American consumers, Lutnick dismissed the idea, citing India’s high tariff rates without corresponding inflation. He reiterated the US stance on reciprocal tariff treatment, emphasising that India’s high tariffs would need to be reevaluated.
“There is no inflation from tariffs. As you know, I mean, India has amongst the highest, if not the highest, tariff rate in the world, the second highest tariff rate in the world. And because you have such high tariffs, do you have inflation? Of course not. Remember, inflation only comes from running deficits and printing money. India and your economy and all the people…they understand that tariffs have not created inflation in India. So my opinion to that is that’s nonsense,” he argued.
On the bilateral trade agreement that is expected to be inked by the fall of 2025, the Secretary said the right way to do it is on a macro level.
Source : ANI