4 min readNew DelhiMar 28, 2025 07:36 AM IST
First published on: Mar 28, 2025 at 04:45 AM IST
Indian trade negotiators have sought details on US implementation plans for reciprocal tariffs set to take effect on April 2 during ongoing trade talks. However, US counterparts have remained focused on discussing the scope of the deal, revealing little about reciprocal tariffs that India is keen to avoid, The Indian Express has learnt. This has raised concerns among Indian trade officials that the US could use reciprocal tariffs as leverage to push for an early conclusion of the deal on goods, where it has sought broad market access in sectors including automobiles, whisky, and agriculture.
“The Indian side has sought details on the implementation plans for reciprocal tariffs, as there is a lack of clarity on whether the new tariffs will be applied sector-wise or at a national level. But US counterparts that include political appointees, have not shared any details,” a government official said.
“Talks are currently focused on the language of the terms of reference (ToR), which define the scope of the trade deal. This has created a sense that the April 2 tariffs will take effect and be used to pressure India into signing the goods agreement early,” the official said.
Earlier this week, US President Donald Trump hinted at a possible softening of stance on reciprocal tariffs, stating that a “lot of countries” would be given a break on April 2. However, as threatened, Trump announced that tariffs on automobiles and parts would take effect next week.
This paper had earlier reported that US demands include greater market access, primarily in automobiles, whisky, and certain agricultural products. Indian negotiators, meanwhile, are seeking improved market access in labour-intensive sectors such as textiles and leather. On digital trade, India expects the US to push for greater access to data, challenging India’s strict data localisation norms, which require Indian data to be stored within the country. During Trump’s first term, disagreements over data localisation were a major source of friction between the two nations.
On Wednesday, Trump escalated his trade war by announcing 25 per cent tariffs on automobiles and auto parts from April 3, raising uncertainty over Indian auto component exports worth nearly $7 billion and the sector’s future growth prospects in the North American market. Citing national security concerns, the White House said that automobiles would be subject to 25 per cent tariffs starting on April 3—a day after US reciprocal tariffs come into effect—while auto parts would face similar tariffs “no later than May 3, 2025,” unless such actions are expressly “reduced, modified, or terminated.”
Query emailed to the Commerce and Industry Ministry late on Thursday remained unanswered till press time.
A Goldman Sachs report suggested that India could be affected by Trump’s tariffs at the national level, the product level, or through non-tariff barriers, all of which could complicate trade relations between the two nations.
At the national level, the report noted that reciprocity would be the simplest approach. If applied at the product level—where the US matches India’s tariffs on each imported product—”this may increase the average tariff differential by approximately 11.5 percentage points but would be more complex and require a longer implementation timeline.”
“Reciprocity through non-tariff barriers, such as administrative restrictions, import licences, and export subsidies, is the most complicated approach, given the challenges of estimating non-tariff barriers. However, it could lead to even higher tariffs at either the product or national level,” Goldman Sachs stated.
Prime Minister Narendra Modi during a meeting with US President Donald Trump at the White House, in Washington, DC, USA. Union External Affairs Minister S Jaishankar and NSA Ajit Doval are also seen. (@WhiteHouse on X via PTI Photo) 
Share
