Trump’s Tariff on Indian Goods Revised to 26% in Latest White House Update

In a recent White House tariff update, the reciprocal tariffs on Indian goods have been revised from 27% to 26%. This new decision falls under a broader policy shift concerning Trump tariffs, which are part of the trade defence approach aimed at reshaping US-India trade relations.

The revised figures are part of a larger tariff reform where 14 countries, including India, saw changes in their US import tariffs. Countries like South Korea, Pakistan, Norway, and several African nations have experienced similar revisions. While most changes are marginal, they signal an evolving trade dynamic under the current policy.

Why Does the Tariff Shift Matters?

As per the latest White House tariff update, India’s revised rate of 26% differs from the 27% stated earlier. The update follows a previous announcement made on April 2, where Trump tariffs were outlined to impose a flat 10% global tariff starting April 5. The final annex listed specific countries for additional increases, including India.

For India, the move marks a subtle yet important shift in India export tariffs, especially in sectors like steel, aluminium, and auto parts. Although minor, the 1% reduction could slightly ease the burden on exporters, many of whom have already been adjusting to changing reciprocal tariffs.

India’s Response to the Revised Tariffs

In reaction to the changes, the Indian Ministry of Commerce and Trade stated that it is actively monitoring the situation and gathering industry feedback. Officials indicated that the ministry is in dialogue with stakeholders to assess the broader implications of the India tariffs and to explore any potential opportunities that could emerge from the new US-India trade environment.

How Indian Goods Tariffs Are Changing?

As outlined in the policy, Indian exports are now subject to a two-stage tariff structure. Initially, a 10% global tariff was imposed from April 5 to April 8. From April 9 onwards, a country-specific rate of 26% applies to Indian goods. While sectors like pharmaceuticals, semiconductors, copper, and energy products (including oil and gas) remain exempt, others such as gems, auto parts, and aluminium face the revised India export tariffs.

This update may have a chain reaction on trade volumes between the two nations. The trade deficit between the US and India stood at $35.31 billion in 2023–24, making these shifts critical in balancing bilateral trade.

What’s Next for US-India Trade?

As Trump tariffs reshape the global trade environment, India is taking a cautious yet strategic approach. According to earlier reports, Indian officials are even considering lowering their own import tariffs on US goods worth $23 billion to offset the impact of these new US import tariffs.

These adjustments could offer relief to sectors such as jewellery, pharmaceuticals, and high-end vehicle imports. Over the years, India has gradually lowered duties on premium goods like motorcycles and bourbon and removed certain digital service taxes to promote a healthier US-India trade relationship.

Conclusion

While the long-term impact of Trump tariffs is still unfolding, India’s adaptability and policy dialogue could help ensure that its trade prospects remain robust and competitive on the global stage.

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