US President Donald Trump has announced that he will impose ‘reciprocal tariffs’ on several countries from April 2. This includes countries like India, Brazil, and China. Addressing a joint session of the US Congress on Tuesday, Trump said that this step is being taken in response to unfair trade practices. However, India hopes that it can avoid these tariffs through ongoing trade talks.Trump expressed his intention to impose retaliatory tariffs to balance trade, which has raised concerns of a global trade war. At the time of Trump’s announcement, India’s Commerce Minister Piyush Goyal is on a visit to the US for about a week for trade talks.According to sources associated with the trade talks, positive talks are going on between India and the US, and both sides are working to address each other’s concerns. These include discussions on resolving tariff and non-tariff barriers.”An Indian delegation led by Commerce Minister Goyal is holding important meetings in the US. We have agreed to conclude the first phase of a bilateral trade agreement (BTA) by the end of 2025,” a source said.Another source said the Indian delegation will consider trade matters as per the joint statement finalized in the meeting between Prime Minister Narendra Modi and President Trump on February 13.In his lengthy speech to a joint session of the US Congress, Trump alleged that India, China, Canada, Mexico, and the European Union impose unfair trade duties on the US. “If you don’t make your product in the US… you will have to pay duties, and in some cases it will be very high. Other countries have been imposing duties on us for decades; now it’s our turn,” he said. Naming India, he said, “India imposes more than 100% duty on our automobiles, China imposes double the duty on our products, and South Korea charges us four times more. This unjust system will end now.” Trump clarified that the purpose of these tariffs starting from April 2 is to correct the trade imbalance.In the Modi-Trump meeting in Washington on February 13, a target was set to increase bilateral trade to more than $500 billion by 2030. For this, both countries have planned to complete the first phase of a multilateral trade agreement (BTA) by the end of 2025.According to the joint statement, “India and America will work for new, fair agreements in the trade sector.” In this, there is agreement on issues like increasing market access, reducing tariff and non-tariff barriers, and deepening the supply chain.Although President Trump has announced the implementation of ‘reciprocal tariffs’ from April 2, there is hope for a possible solution from the trade talks between India and America. New announcements regarding the trade agreement between the two countries are possible in the coming days.Talking on this topic, Arya Jha, a financial analyst at Deloitte who specializes in the Indo-US trade sector, gave her insight on the matter. She said, “Trump’s strategy to make America great once again and safeguard its own economy at the cost of other economies can bring about a turmoil in world trade. If India is not able to convince Trump to exempt it from its new tariff policy, India’s exports are likely to suffer a heavy blow, and this will also lead to volatile exchange rates and an overall loss of forex reserves, weakening the Indian economy.”
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