Saturday, March 29, 2025
Will the 50% Tariff Dispute End? India-U.S. Talks Show Positive Signs, Rupee Strengthens
New Delhi, September 16, 2025 – The ongoing tariff conflict between India and the United States may soon be nearing resolution. Both sides described Tuesday’s talks as “positive,” raising hopes of a breakthrough after months of tension triggered by U.S. President Donald Trump’s decision to impose a 50% tariff on Indian goods.
High-Level Meeting
U.S. Deputy Trade Representative Brandon Lynch arrived in India on Monday night, marking the first visit by a senior American trade official since Washington imposed a 25% duty and an additional 25% penalty on Indian products. The tariffs were introduced after India continued purchasing Russian crude oil, a move that had strained ties between the two countries.
Following Tuesday’s discussions, a spokesperson for the U.S. Embassy said:
“Deputy USTR Brandon Lynch had a positive meeting with his counterpart Rajesh Aggarwal on September 16 to discuss bilateral trade issues.”
The Indian government echoed this sentiment, noting that the talks reaffirmed the “enduring importance of bilateral trade relations.”
Not a Formal Round Yet
A senior Commerce Ministry official clarified that the meeting should not be viewed as the sixth formal round of negotiations, but rather as a preparatory step. He added that India and the U.S. have maintained weekly virtual consultations, which helped pave the way for Lynch’s visit.
Market Reaction
Investor sentiment improved after reports of progress in trade discussions. On Tuesday, the Indian rupee strengthened by 8 paise to close at ₹88.08 per U.S. dollar (provisional). Forex traders attributed the gain to optimism over India-U.S. relations, buoyant domestic markets, and a weaker dollar, which recently hit a two-month low ahead of the Federal Reserve meeting.
Outlook
While no official rollback of the 50% tariffs has been announced, both sides signaled willingness to de-escalate the trade dispute. Analysts believe sustained dialogue could pave the way for a phased resolution, easing pressure on India’s exports and boosting investor confidence.
