“Zero Tariff” to the U.S.? India Quickly “Slaps Back” at Trump

U.S. President Donald Trump claimed on Thursday that India had proposed eliminating tariffs on all goods imported from the United States. However, this statement was promptly denied by Indian officials.

Indian Foreign Minister Subrahmanyam Jaishankar stated in a press release that negotiations are still ongoing and “nothing has been finalized.” He emphasized that any trade agreement must be beneficial to both parties and that “it is too early to make judgments before reaching a consensus.”

Earlier that day, Trump told a business event in Doha, Qatar, that India “has offered us a deal where they basically want zero tariffs on our goods.” He also mentioned Apple’s plan to produce iPhones in India and said he had told Apple CEO Tim Cook that he did not want him to build factories in India because India is “one of the highest-tariff countries in the world.”

The media quickly mocked that India’s “tough stance” toward the U.S. lasted only two days. Since Trump took office, India had maintained a relatively moderate attitude despite a series of aggressive U.S. tariff measures. However, earlier this week, India imposed retaliatory tariffs on some U.S.-made goods in response to the 25% tariffs the U.S. placed on Indian steel and aluminum products, signaling a tougher stance.

In April, Trump announced 27% retaliatory tariffs on Indian goods but granted a 90-day exemption period during which a baseline 10% tariff was applied. India is actively negotiating with the U.S. to reach a mutually beneficial trade agreement before the exemption expires on July 9.

The U.S. is India’s largest trading partner, with bilateral trade reaching nearly $130 billion in 2024. Although India has lowered tariffs on some U.S. products, the U.S. trade deficit with India remains about $45 billion, which Trump hopes to reduce.

Media reports indicate India has proposed reducing the tariff gap between the U.S. and India from nearly 13% to below 4% in exchange for tariff exemptions.

Since Trump took office in February, both sides have been actively negotiating trade issues.

India’s Commerce Minister Piyush Goyal is expected to visit the U.S. from May 17 to 20 to meet U.S. Trade Representative Katherine Tai and Commerce Secretary Gina Raimondo to discuss the bilateral trade agreement, including India’s proposal for retaliatory tariffs on certain U.S. products.

Additionally, a delegation led by India’s Chief Trade Negotiator Rajesh Agrawal will visit the U.S. from May 19 to 22 to hold talks on market access, rules of origin, and non-tariff measures.

Analysis and Opinions

• Trump’s statements contrast sharply with India’s official stance
  Trump exaggerated India’s trade concessions, while India promptly clarified that negotiations are ongoing and no substantive agreement has been reached, reflecting a tug-of-war in trade positions.
• India adopts a cautious and pragmatic negotiation approach
  India emphasizes “mutual benefit,” avoids easy commitments to zero tariffs, reflecting its stance to safeguard national interests and trade sovereignty while maintaining an open dialogue with the U.S.
• Tariff disputes highlight U.S.-India trade tensions
  The U.S.’s high tariffs on Indian steel and aluminum and India’s retaliatory tariffs reveal significant trade frictions, with negotiations focusing on balancing trade deficits and protecting domestic industries.
• Large bilateral trade volume with great cooperation potential
  Nearly $130 billion in trade means both sides are keen on reaching favorable agreements, maintaining long-term cooperation, impacting global supply chains and regional economic dynamics.
• Subsequent negotiations will focus on technical details and policy concessions
  Market access, rules of origin, and non-tariff measures will be key topics. India’s delegation visiting the U.S. shows a proactive attitude to push the deal forward.
• Trade talks require time; premature conclusions are unwarranted
  This stage is a bargaining period with both sides seeking maximum benefit. Final agreements require detailed negotiations and compromises; short-term rhetoric fluctuations are normal.