India Defends US Tariff Reductions Amid Trump's April 2 Deadline

With less than a month remaining until US President Donald Trump's April 2 deadline for imposing reciprocal tariffs on India, senior sources have defended New Delhi's decision to significantly reduce tariffs, highlighting it as part of a broader strategy to strengthen trade relations with developed nations through bilateral agreements.

India has previously lowered its average applied tariffs for countries such as Australia, the UAE, Switzerland, and Norway under a series of bilateral trade deals, with negotiations currently ongoing for similar agreements with the European Union and the UK.

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Sources emphasised that the ongoing discussions between India and the US on tariff reductions should be viewed in this wider context, rather than as a response to Trump's impending deadline.

According to reports, the US has requested that India remove tariffs on almost all goods except agricultural products. If accepted, this would mean New Delhi sacrificing its trade protections without receiving any reciprocal concessions.

The US remains India's largest trading partner, with bilateral trade reaching a record $118.2 billion in the last financial year.

India-US Bilateral Trade Talks

Last month, both nations agreed to negotiate the first phase of a multi-sector Bilateral Trade Agreement (BTA) by the end of the year, with the long-term goal of expanding bilateral trade to $500 billion by 2030.

This was endorsed by President Trump and Prime Minister Narendra Modi during Modi's visit to Washington in February. Both leaders also agreed to designate senior representatives to advance the negotiations, increase market access, and work towards reducing tariff and non-tariff barriers to strengthen supply chain integration.

Following this, an Indian delegation led by Union Commerce Minister Piyush Goyal visited Washington from 3-6 March, holding discussions with US Commerce Secretary Howard Lutnick and Trade Representative Jamieson Greer.

During Trump's first administration, similar discussions on a limited trade deal between the US and India were held but ultimately did not yield results.

With the April 2 deadline fast approaching, Indian policymakers and businesses are exploring ways to mitigate the impact, with several reports suggesting the Indian government is considering tariff reductions on key US imports. Meanwhile, companies across multiple sectors are engaging with their American partners to ensure business continuity.

Trump's Reciprocal Tariff Warning

In his first joint address to the US Congress as President, Trump warned that reciprocal tariffs would be imposed from April 2 on most of Washington's trading partners, including India, for implementing trade policies that he deemed unfair to Americans.

"India charges us tariffs higher than 100 per cent, China's average tariff on our products is twice what we charge them, and South Korea's average tariff is four times higher. This is happening by friends and foes alike. The system is not fair to the US; it never was. On April 2, reciprocal tariffs will be enforced. Whatever they tax us, we will tax them," Trump declared.

In February, Trump instructed his administration to investigate reciprocal tariffs for all of the US' trading partners, with a report expected by April 1. During his presidential campaign, he also pledged to address what he called unfair trade practices by foreign nations.

Supporting Trump's stance, US Commerce Secretary Howard Lutnick reiterated on Friday that India has some of the highest tariffs in the world, making it necessary to re-evaluate trade relations and determine the future course of economic ties between New Delhi and Washington.

Speaking at the 2025 India Today Conclave, Lutnick urged India to reduce tariffs on American goods, stating that such a move would be crucial to developing an extraordinary relationship between the two nations.