US-India Trade Tensions Escalate: Potential 26% Tariff Looms as Countries Negotiate Mini-Trade Deal

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US-India Trade Tensions Escalate: Potential 26% Tariff Looms as Countries Negotiate Mini-Trade Deal

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Listeners, today we're tracking the latest developments in the US-India trade relations, particularly focusing on tariffs. The Trump administration announced a comprehensive tariff plan on April 2, 2025, which included a 26% tariff on India. This move was part of a broader strategy to address what the administration perceives as unfair trade practices by other countries. The 26% tariff was later put on hold for 90 days, but a standard 10% tariff remains in place for Indian goods.

India has been in intense negotiations with the US to avoid these tariffs. According to reports, both countries are close to finalizing a mini-trade deal, which could reduce tariffs to around 10%. This agreement is expected to pave the way for more comprehensive trade discussions later. The US has been pushing India to reduce its trade barriers, particularly in agriculture, while offering to reduce some of its tariffs in return.

However, India has been firm on protecting its agricultural sector, resisting demands to lift restrictions on genetically modified seeds and crops. Instead, it has expressed openness to reducing tariffs in other areas, such as leather, textiles, and footwear.

With a deadline of July 9 for new tariffs to potentially kick in, the situation remains critical. The US plans to send letters to several countries, including India, outlining the terms of trade. If no agreement is reached, tariffs could increase further. Trump has also announced that any country supporting what he calls "Anti-American policies" associated with the BRICS group could face an additional 10% tariff.

Given these developments, it's clear that the next few days will be pivotal in determining the future of US-India trade relations. Listeners, stay tuned for more updates as this story unfolds.

Thank you for tuning in to "India Tariff News and Tracker." Don't forget to subscribe to our podcast for the latest updates on US-India trade relations.

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