[Salon] Indian Government to Discuss Support for Exporters Ahead of New US Tariffs

[Chas Freeman <cwfresidence@gmail.com>]

https://sputnikglobe.com/20250826/indian-government-to-discuss-support-for-exporters-ahead-of-new-us-tariffs-1122675177.html

8/26/25

Indian Government to Discuss Support for Exporters Ahead of New US Tariffs

Starting Wednesday, Indian goods entering the US market will be subject to a 50% tariff after Washington doubled the existing duties, increasing price pressure on exporters. 

The meeting is expected to be chaired by Prime Minister Narendra Modi's principal secretary, the newspaper said. 

India's ministry of commerce is holding consultations with exporters and export promotion councils to minimize the impact of the existing 25% levy, which companies say has already led to margin compression and reduced competitiveness, the newspaper said, adding that policy measures under discussion include targeted support for specific sectors rather than broad economy-wide measures. 

Exporters have reportedly requested an emergency credit line guarantee scheme offering unsecured working capital with government risk coverage, although officials believe sectoral interventions may be more effective. 

In late July, US President Donald Trump announced the introduction of a 25% tariff on imports from India, citing high tariffs from New Delhi, trade barriers and its purchasing of energy and military equipment from Russia. The tariff came into effect on August 7. At the same time, Trump also signed an executive order imposing a further 25% duty linked to India’s purchases of Russian oil, which took effect on August 27. 

Before the latest measures, Indian officials believed that India could resolve US tariff issues within a broader trade agreement. New Delhi and Washington have held multiple rounds of talks on a potential deal. According to media reports, a key sticking point remains US pressure on India to allow genetically modified crops into its agricultural market. India has rejected that demand, arguing such imports could harm farmers and pose food security risks. While both sides continue to seek common ground, the issue has reportedly slowed progress toward a final agreement.