Indian Commerce Ministry Weighs Next Move in US Trade Talks Amid Uncertainty

India's Trade Negotiations with the US Remain Uncertain

February 23, 2024

Finance Minister Nirmala Sitharaman has stated that it is too early to comment on the next phase of India's trade negotiations with the US. The commerce ministry is reviewing the situation, and a decision on further engagement with Washington will be made by the delegation at a later date.

The uncertainty surrounding trade negotiations is compounded by recent developments in the US. On February 20, the US Supreme Court struck down emergency tariffs imposed under the International Emergency Economic Powers Act (IEEPA). In response, the Trump administration introduced a new global import surcharge of 10%, which was later increased to 15% under Section 122 of the Trade Act of 1974.

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Key Developments

• The US Supreme Court struck down emergency tariffs imposed under the IEEPA on February 20.
• The Trump administration introduced a new global import surcharge of 10%, later increased to 15%.
• India and other countries are now facing a 15% tariff on imports, replacing the previously imposed emergency tariffs.

India's Trade Policy Direction Remains Unchanged

Despite the uncertainty surrounding trade negotiations with the US, Sitharaman emphasized that India's broader trade strategy remains unchanged. The country has successfully negotiated trade agreements with EFTA, Australia, New Zealand, UAE, Qatar, Oman, and the EU, and will continue to pursue trade deals with other countries to promote global trade and economic growth.

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RBI Governor Sanjay Malhotra was also present at the meeting, which was held after the Post Budget Board of Directors meeting at RBI on February 23.