Stories
US Considers Lower Tariffs for India as Trade Talks Near Finish
M
Moneycontrol•21-10-2026, 22:33
US Considers Lower Tariffs for India as Trade Talks Near Finish
- •The United States is considering India's demand for more favorable tariff terms compared to competing export economies like Bangladesh and Vietnam as Bilateral Trade Agreement negotiations near completion.
- •US Secretary of State Marco Rubio indicated an openness to ensuring a sustainable trade relationship that delivers better tariff rates for India.
- •India is aiming for a competitive edge in labor-intensive sectors such as textiles, apparel, and footwear against Asian peer economies.
- •Commerce and Industry Minister Piyush Goyal stated that the first tranche of the India-US trade deal is in the final stages of legal drafting.
Key Questions Answered
India is pushing for more favourable tariff terms and preferential treatment compared to competing export economies such as Bangladesh, Vietnam, Thailand, and Indonesia, particularly in labour-intensive sectors like textiles, apparel, leather, and footwear.
Under an interim trade deal framework announced in February 2026, the US had agreed to apply an 18% reciprocal tariff rate on Indian goods covered by the arrangement.
The US Supreme Court invalidated the administration's use of emergency powers to impose sweeping reciprocal tariffs in February 2026. Consequently, the Trump administration introduced a 10% baseline import tariff, which altered the original framework's calculations and created fresh uncertainty over export duties.
