India keeps close watch on USA trade concerns

During April–Jan 2025–26, India’s exports to the US included USD 20.86 billion in electronics, including smartphones, engineering goods

India continues to closely monitor developments related to US tariffs and remains engaged with the American government to safeguard its trade interests, Parliament was informed on Tuesday.

In a written reply to the Lok Sabha, Minister of State for Commerce and Industry Jitin Prasada said the US had imposed an additional 25 per cent tariff on certain Indian exports on February 7 over India’s purchase of Russian oil. However, following a US Supreme Court ruling on February 20 that invalidated reciprocal tariffs, these measures are no longer in effect.

“The US government has issued executive orders imposing 10 per cent tariffs on certain products for all countries. The government is studying all subsequent developments for their implications and remains in active engagement with the US,” the minister added.

Prasada also highlighted India’s approach under the first phase of the bilateral trade agreement, which includes limited and carefully calibrated tariff concessions on select agricultural products while protecting domestic interests. Concessions have been structured through quotas, phased reductions, and partial duty cuts.

Products such as apples, walnuts, and soybean oil, which India imports in significant quantities due to domestic demand exceeding production, are included under quota-based concessions to help diversify sourcing without harming local farmers. Similarly, animal feed-related products like DDGS and non-GM red sorghum have been allowed in limited quantities with partial tariff reductions to prevent any negative impact on domestic feed crops.

Cotton has also been offered under a calibrated, quota-based system, keeping in mind India’s trade patterns of both importing and exporting cotton and cotton products to meet quality requirements.

India and the United States had announced a trade deal on February 2, 2026, aimed at enhancing bilateral trade ties. Prasada also noted India’s awareness of the US-Bangladesh Agreement on Reciprocal Trade signed on February 9, 2026. He added that India’s cotton trade with Bangladesh may continue to benefit due to geographical proximity, lower freight costs, shorter transit times, established supply chains, and long-standing industry linkages.

During April–January 2025–26, India’s exports to the US included USD 20.86 billion in electronics, including smartphones, USD 5.98 billion in engineering goods, USD 0.96 billion in solar equipment, USD 4.83 billion in metals and equipment, USD 2.03 billion in auto components, USD 7.25 billion in pharmaceuticals, USD 7.88 billion in textiles, and USD 4.19 billion in gems and jewellery.

Prasada emphasized that the government is closely monitoring trade developments and ensuring that India’s engagement with the US protects domestic industries while supporting strategic diversification of imports.