Saturday, March 29, 2025
India’s Chief Economic Adviser V. Anantha Nageswaran has expressed optimism that the United States will lift the 25% penal tariff imposed on certain Indian imports after November 30, 2025. This follows recent trade talks between India and the US and improving relations between the two countries.
Nageswaran stated that along with removing the penal tariff, the existing 25% reciprocal tariff on Indian goods may also be reduced to a range of 10–15%. These tariffs, introduced in August in response to India’s purchases of Russian oil, have raised costs for Indian exporters and harmed competitiveness. With both governments now in close negotiations, he expects a resolution on both the penal and reciprocal tariffs within the next 8–10 weeks, though he clarified these are his personal projections, not formal guarantees.
The double-layered tariffs mean some Indian exports currently face duties as high as 50%, affecting sectors like textiles, engineering goods, and food products. Trade experts estimate that if these tariffs continue until the end of FY26, India risks losing $30–35 billion in US export business.
US negotiators have recently met with Indian officials to address these issues, and analysts believe that a rollback—even a partial one—will boost Indian exporters and reestablish stability in this vital trade relationship.
