Reflecting on concerns over the penal tariffs imposed by the US, Chief Economic Advisor V Anantha Nageswaran on Thursday expressed relief, stating that the duties on certain products are expected to be withdrawn after November 30.
“All of us are already at work, and I will take some time to talk about the tariff here”, said the CEA while speaking at an event organised by the Merchants’ Chamber of Commerce & Industry in Kolkata.
He noted that neither the original 25% reciprocal tariff nor the additional 25% penal tariff had been anticipated. Referring to the improving ties between US President Donald Trump and Prime Minister Narendra Modi, the CEA said it is his belief that, given recent developments, the penal tariff will likely be withdrawn after November 30 despite tense geopolitical circumstances.
“I do believe that there will be a resolution in the next couple of months on the penal tariff and hopefully on the reciprocal tariffs,” he said, mentioning the continued talks between India and US.
He pointed to Trump’s recent gestures towards India. Earlier this week, Trump said India and the US share a “very special relationship.” On Prime Minister Modi’s birthday, he extended warm wishes, calling Modi a “special friend” and even addressing him by his first name, Narendra.
Dispelling the myth that India’s economy is weakening, the CEA highlighted that the country’s annual exports, currently at USD 850 billion, are on track to touch USD 1 trillion, which is about 25% of GDP, reflecting a healthy and open economy.
According to a report by the Global Trade Research Initiative (GTRI), about 30.2 per cent of India’s exports to the United States, valued at USD 27.6 billion, will continue to enter the US market duty-free despite the imposition of higher tariffs.
The Ministry of Commerce on Tuesday said its officials held “positive and forward-looking” trade talks with a US delegation led by Chief Negotiator Brendan Lynch in New Delhi.
Both countries decided to intensify efforts to achieve early conclusion of a mutually beneficial Trade Agreement, the Ministry of Commerce said in a statement.