‘Tariffs and India’ Report released by GTRI (Global Trade Research Initiative) | Current Affairs | Vision IAS
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‘Tariffs and India’ Report released by GTRI (Global Trade Research Initiative)

Posted 26 Feb 2025

2 min read

It analyzes potential impact of U.S. Reciprocal Tariff Plan and proposes actions for Indian government and industry stakeholders to mitigate losses.

  • U.S. Reciprocal Tariff Plan aims to counter trade imbalances by imposing higher tariffs on countries with which the U.S. runs a trade deficit.

Impact of US Reciprocal Tariff Plan

  • On India: Indian exports could face an additional tariff of 4.9% compared to the current 2.8%.
  • Sector-Level Impact:
    • Agriculture: Farm exports would be hit hardest, with shrimp, dairy, and processed foods facing tariffs of up to 38.2%.
    • Industrial Goods: Major risks would be on Pharmaceuticals, diamonds & jewelry, and electronics exports.
      • E.g. Tariff differential on pharmaceutical sector to the tune of 10.90% may  increase costs for generic medicines impacting demand and reducing competitiveness
  • Minimal Impact: Petroleum, minerals, and garments may be unaffected.

Recommendations

  • Make an advance tariff offer to the US, drop FTA plan: 
    • India should propose a zero-for-zero strategy by identifying tariff lines where India can eliminate tariffs for U.S. imports without harming domestic industries
  • Adoption of Retaliatory Measures: India should refuse unfair concessions and consider countermeasures, similar to China’s response.
  • Reconcile large gap in the trade data as reported by India and the US:  to prevent tariff decisions based on inaccurate numbers.
  • Tags :
  • Reciprocal Tariffs
  • USA Tariff
  • US Reciprocal Tariff Plan
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