Trump Presidency: Just a day after the new President-elect made fresh comments on tax reciprocation over India, talks are looming around a potential trade deal between the two nations.
"If they tax us, we tax them," Trump said at a media conference.
"India charges a lot. Brazil charges a lot. If they want to charge us, that’s fine, but we’re going to charge them the same thing," he reportedly said.
India is unlikely to disrupt its trade deals with the West, especially at a time when geopolitical turbulence has reached its culmination point.
According to sources cited in a report by Reuters, the country is now planning to lower tariff levels on certain agricultural goods and other products imported from the US. While the main goal remains securing a 'broader trade and investment deal' once Trump takes over the presidency role, another thing that is playing a major role here is the China factor.
Trump has already made his stance clear towards the dragon nation. The imposition of even higher tariffs on goods imported from China seems quite imminent.
Besides dairy products, India might also reduce the tariff levels on high-end medical equipment and luxury motorcycles like Harley Davidson, sources cited in the report added. Usually, such products witness tariff rates ranging from 25 per cent to 60 per cent.
India's trade play
During the first half of 2024, the country had a trade surplus with 151 nations, including the US, and a trade deficit with 75 nations.
As per think tank GTRI (Global Trade Research Initiative), India recorded its highest trade surplus with nations like the US and the Netherlands, while its largest trade deficits were with China, Russia, Iraq, Indonesia and the UAE.
"Between January and June 2024, India had a trade surplus with 151 countries, representing 55.8 per cent of its exports and 16.5 per cent of its imports, totaling $72.1 billion," the think tank stated in its September report. Bilateral trade between India and the US reached over $118 billion in FY24.
During this period, India recorded a $32 billion trade surplus. And as Trump is all set to take over the White House again, India is preparing for trade talks with the country, aiming to secure broader trade and investment agreements.
Sources cited in the Reuters report also added that India might buy more LNG (Liquefied Natural Gas) and defence equipment from the Western nation to offset Trump's concerns around trade imbalance.
