US tariff: India may lose advantage

WITH the US and China reaching an agreement to significantly reduce tariffs on each other's imports, India may lose the edge it had gained from the earlier imposition of reciprocal duties.

- DIPAK MONDAL @ New Delhi

The US had initially levied an additional 26% tariff on imports from India—much lower than the 145% imposed on Chinese goods. At the time, the view was that this skewed tariff structure could help India attract manufacturing operations shifting out of China.

However, on Monday, China and the US reached a deal under which the US will cut tariffs on Chinese imports from 145% to 30%, while China will reduce duties on US products from 125% to 10%.

These reductions will not impact any sector-specific tariffs or exemptions that existed prior to April 2, 2025.