Commerce Ministry responds to Trump's 27% tariff, says 'India to remain in touch with US'

After Donald Trump announced reciprocal tariff on India, the Commerce and Trade Ministry on Thursday responded by saying that they will remain in touch with US, adding that the department is also studying the opportunities that may arise due to this new development in the US trade policy.

"Keeping in view the vision of Viksit Bharat, the Department is engaged with all stakeholders, including Indian industry and exporters, taking feedback of their assessment of the tariffs and assessing the situation. The Department is also studying the opportunities that may arise due to this new development in the US trade policy," said the ministry in the statement.

The U.S. slapped a 27% tariff on imports from India in a setback to the South Asian nation's expectation of getting relief from President Donald Trump's global trade policy that has unnerved world markets for weeks.

India-US trade talks

The Commerce Ministry in the statement said that discussions are ongoing between Indian and US trade teams for the expeditious conclusion of a mutually beneficial, multi-sectoral Bilateral Trade Agreement. "These cover a wide range of issues of mutual interest including deepening supply chain integration. The ongoing talks are focused on enabling both nations to grow trade, investments and technology transfers. We remain in touch with the Trump Administration on these issues and expect to take them forward in the coming days," said the ministry's statement.

The US has a trade deficit of $46 billion with India.

Last week Reuters reported that New Delhi is open to cutting tariffs on U.S. imports worth $23 billion to mitigate the impact on its exports in sectors like gems and jewellery, pharmaceuticals and auto parts.

Modi's administration has taken a number of steps to win over Trump by lowering tariffs on high-end bikes, bourbon and dropping a tax on digital services that affected U.S. tech giants.

Before the reciprocal announcement, the U.S. tariff rates were among the lowest, with simple average tariffs at 3.3%, compared with India's 17%, the White House said.

New tariff structure on Indian goods

• Existing tariffs: 25% on steel, aluminum, and auto parts.
• New tariffs: April 5-8: A 10% baseline tariff on remaining Indian goods; April 9 onwards 27% tariffs will apply to India-specific imports.
• Exempted sectors: Pharmaceuticals, semiconductors, energy products (oil, gas, coal, LNG), and copper.

India is not the only country affected. The US has also imposed 54% tariffs on China; 46% on Vietnam; 37% on Bangladesh; 36% on Thailand. As per the industry players and experts, India's position is comparatively more favourable than that of its competitor nations even as the duties might pose challenges for Indian goods.

Which sectors does it impact?

The latest tariffs are a part of the ongoing US-India trade relationship, affecting exports from India to the US. Since the US accounts for 18% of India’s total exports and 10.73% of bilateral trade, the impact could be significant.

India's main exports to the US, as of 2024, included drug formulations and biologicals ($8.1 billion), telecom instruments ($6.5 billion), precious and semi-precious stones ($ 5.3 billion), petroleum products ($4.1 billion), gold and other precious metal jewellery ($3.2 billion), ready-made garments of cotton, including accessories ($2.8 billion), and products of iron and steel ($2.7 billion).