On Sunday, two Indian government officials said that India does not intend to take revenge measures towards the 26% customs duties imposed by US President Donald Trump on imports coming from India, noting that New Delhi is seeking to avoid escalation, in light of current talks to reach a comprehensive trade agreement with Washington.
Reuters quoted one of the officials, who preferred not to disclose his identity due to the sensitivity of the file, that the administration of Prime Minister Narendra Modi is studying one of Trump’s decree terms, which includes “a possible period for countries that take fundamental steps to address unfinished commercial arrangements.”
India is betting on early dialogue
Another official, who also asked not to be named, explained that New Delhi considers herself a better position than other Asian countries such as China, Vietnam, and Indonesia, which was imposed on higher fees within the new US customs package. The official said: “India is one of the first countries to have entered into talks with Washington, and this gives it a priority in negotiating compared to other countries that have been delayed in response or escalation.”
Reuters added that in February 2025, India and the United States agreed to set a timetable to reach a trade agreement by the fall of 2025, with the aim of settling commercial differences, especially those related to customs duties.
Indian concessions to appease Washington
In a related context, Reuters said that New Delhi has been ready to reduce customs duties on US imports worth 23 billion US dollars, a step aimed at enhancing confidence with the Trump administration.
The agency pointed out that the Moody government has taken several prior steps to win the satisfaction of the American side, including reducing fees on luxury bicycles, and canceling the tax tax tax that negatively affected major American technology companies such as “Amazon” and “Google”.
Indian economy under the pressure of fees
Economic sources warned that the new American fees may lead to the slowdown in economic growth in India by 20 to 40 basis points during the current fiscal year, equivalent to between 0.2% and 0.4% of GDP.
Reuters also indicated that the Indian diamond industry is at risk of directly damaging the decision, as India has exported more than a third of its diamond production to the United States, and the expected contraction may be exposed to the demand for thousands of jobs, especially in states such as Gujarat and Maharashtra that are essential centers for refining and trading diamonds.
