'Beginning of negotiated reduction': Mohandas Pai calls for India to lower duties after Trump slaps reciprocal tariffs

Following President Donald Trump's announcement of reciprocal tariffs, former Infosys CFO and investor Mohandas Pai emphasizing the need for India to take a strategic approach by lowering import duties on American imports. Pai believes this could help India expand its market in the U.S. while maintaining competitive exports.

"This is the beginning of a negotiated reduction in tariffs. India should reduce her tariffs on many American imports, expand her market in the US. Israel has already eliminated her tariffs on US imports," Pai tweeted.

Late on Wednesday, Trump announced reciprocal tariffs on various countries, including India. Calling these as "discounted reciprocal tariffs", President Trump said the US will charge an import duty of 26 per cent on India and 34 per cent on China.

This could impact India's trade dynamics, as many Indian products currently face lower tariffs in the US compared to American goods entering India.

Pai suggested that India should take the lead in negotiating lower duties to benefit from trade expansions. "President Trump is using tariffs to force countries to reduce tariffs on their imports from the US and create a level playing field," he noted.

With major trade partners like Israel already eliminating tariffs on US imports, Pai argued that India could benefit by following a similar strategy. "India will benefit by reducing many a tariff on US imports and grow its exports there," he added.

Notably, Trump imposed a 17% tariff on Israel, notwithstanding its exemptions. 

India and the US have had trade tensions over tariffs in the past, with Washington previously criticizing India’s high import duties on products like motorcycles, medical equipment, and agricultural goods. While India has defended these tariffs as necessary for protecting domestic industries, Trump’s reciprocal tariff policy could put pressure on New Delhi to reconsider its approach.