US-India trade talks progress, no signs of deadlock

Trade discussions between the United States and India are progressing smoothly, with no indication of a deadlock, according to official sources. The ongoing negotiations are focused on developing a tailored, sector-wise tariff approach that may be implemented in phases. Officials are exploring the possibility of tariff moderation for high-demand goods with substantial trade volumes, ensuring mutual economic benefits.

A significant development in the discussions is India's potential reprieve in certain sectors, which could boost its export competitiveness. Unlike previous trade negotiations where India was clubbed with Mexico, Canada, or China, this round of talks recognizes India’s distinct position and economic priorities.

A senior Indian government official emphasized the consensus within the administration to strengthen trade ties with the US. However, a full-fledged trade agreement remains difficult to finalize within a short span of two days, given the complexity of outstanding issues, said the official.

Several proposals under discussion may require legislative and procedural ratification in both countries before they can be implemented.

The negotiations are occurring against the backdrop of India’s broader economic strategy, which includes diversifying trade partnerships and attracting foreign investments. Recent trade tensions between the US and China have led to shifting supply chains, with India positioning itself as an alternative manufacturing hub.

Additionally, the US is keen on deepening its trade engagement with India, given its growing market size and strategic importance in global trade networks.

President Donald Trump in an interview with Newsmax yesterday said that tariffs will likely be more "lenient than reciprocal," as the April 2 tariff deadline looms for a number of levies to go into effect.

"I know there are some exceptions, and it's an ongoing discussion, but not too many, not too many exceptions," the president added.

While sensitive issues remain, both sides are demonstrating a strong willingness to resolve differences and establish a sustainable trade framework. 

The US in a not so surprising move yesterday announced new import taxes of 25% on cars and car parts coming into the US. President Trump said the latest tariffs would come into effect on 2 April, with charges on businesses importing vehicles starting the next day.