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The US Supreme Court on Friday canceled the tariffs imposed by President Donald Trump on countries around the world. Just a few hours later, Trump again announced the imposition of 10% tariff. At the same time, the next day on Saturday it was announced to increase it to 15%.
In such a situation, a question is being raised regarding the tariff imposed on India whether India will have to pay 18% tariff or 15%. There are two reasons for this-
- President Trump said in a press conference on Friday that there will be no impact on the trade deal with India. It will proceed as before.
- According to a BBC report, a White House official said that countries that have trade deals with the US, including Britain, India and the European Union, will now face a 10% global tariff under Section 122, and not the tariff rate they had previously negotiated. On this basis, after Saturday’s announcement, there will be 15%
If the BBC report is to be believed then the total tariff on India will be reduced from 18% to 10%, i.e. after Saturday’s announcement it will be 15%, whereas Trump’s statement is pointing towards 18% tariff.
Government of India said – looking into the matter carefully
After the Supreme Court’s decision on tariffs and Trump’s press conference, the Indian government has said that it is looking at the entire matter carefully. The Ministry of Commerce and Industry said on Saturday that whatever new steps the US administration has taken, what impact they may have on India is being assessed.
According to the ministry, the Supreme Court’s decision on Friday and Trump’s press conference have been noted. Some decisions have also been announced by America.
The government is understanding all these developments to determine what impact they may have on India and trade between the two countries.
Trade deal will be finalized by the end of February
Commerce Minister Piyush Goyal spoke to the media on Friday before the Supreme Court’s decision. Then he had told that the ‘interim trade agreement’ with America would be finalized by the end of February. It will be signed in March, while this agreement will be fully implemented from April.
Along with this, in the coming few months, India will finalize trade agreements with big countries of the world. Free trade agreements with Britain and Oman are also expected to start in April.
Legal draft will be finalized on 23 February
From February 23, officials of India and America will hold an important three-day meeting in America. The purpose of this meeting is to prepare a legal draft on the basis of the ‘Joint Statement’ issued on 7 February. Darpan Jain, Chief Negotiator of the Commerce Ministry, will lead the Indian delegation.
It is expected that the official order for reduction in tax from 25% to 18% will come this week or next week. This will directly benefit India’s sectors like textile, leather and gems-jewellery.
Trade deal was announced on 7 February
Commerce Minister Piyush Goyal had given information about the trade deal with America in a press conference on 7 February. He had told that Indian agricultural products will be exported to America at zero tariff, whereas American agricultural products have not been given any tariff exemption in India.
Piyush Goyal clarified that in this agreement, genetically modified (GM) food has not been allowed to enter India. He said- This agreement will open a market worth 30 trillion dollars (about Rs 27.18 lakh crore) for Indian exporters.
India will buy products worth 50 thousand crore dollars from America
Apart from this, India has agreed to buy products worth 50 thousand crore dollars (45 lakh 30 thousand crore rupees) from America in the next 5 years. India and America on Friday released the framework of the Interim Trade Agreement (ITA).
Under this, America’s tax on Indian goods has been reduced from 50% to 18%. The 25% additional tax imposed on India for purchasing oil from Russia has also been removed.
Both countries will remove non-tariff barriers
Piyush Goyal said that both the countries have decided that they will set some rules for it, so that the benefit of this agreement goes mainly to America and India and not to any third country.
India and America have a special focus on removing non-tariff barriers in this trade agreement. These barriers are not tariffs, but make trade difficult. American medical devices companies were facing hurdles like pricing rules, delay in registration in India.
The deal made with Britain and Oman will come into effect in April.
After the India-UK FTA signed in July last year, it can now be implemented from April. With this, 99% of Indian products will get entry in Britain on ‘zero duty’. In return, India will reduce taxes on cars and Scotch whiskey coming from Britain.
The deal with Oman is also expected to be implemented in April, which will ease the access of Indian goods to the Gulf countries. Oman has offered zero duty on more than 98% of India’s products.
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