New Delhi considers concessions to strengthen U.S. ties

Indian Prime Minister Narendra Modi is preparing tariff reductions ahead of his meeting with U.S. President Donald Trump, aiming to boost American exports and prevent a potential trade standoff. The move comes as Washington signals reciprocal tariffs on multiple nations, with India under scrutiny.

Modi's visit to the United States on Wednesday and Thursday comes amid growing trade friction. Trump has previously criticized India, calling it a "very big abuser" and pushing for increased American exports, particularly in defense and security equipment.

Indian officials said New Delhi is considering tariff cuts across at least a dozen sectors, including electronics, medical devices, surgical equipment, and chemicals. Reductions in duties on dish antennas and wood pulp—products primarily sourced from the U.S.—are also being explored as part of a potential mini trade deal.

A senior official described the effort as an attempt to avoid a trade war, referencing the ongoing U.S.-China tensions, where Trump imposed 10% tariffs on Chinese goods, leading Beijing to retaliate with duties on U.S. energy exports.

India’s Trade Adjustments

New Delhi has already lowered its average import tariff from 13% to 11% in its latest budget, including reductions on high-end motorcycles and luxury cars. The government is also reviewing surcharges on more than 30 items, including solar cells and automobiles.

Despite past criticisms of India’s trade practices, Trump has maintained a cordial relationship with Modi, calling him "fantastic".

Trade and Diplomatic Relations

The United States remains India’s largest trading partner, with bilateral trade exceeding $118 billion in 2023/24. India posted a $32 billion surplus, a key issue in Washington’s trade agenda.

While the upcoming talks will center on trade, defense, and technology cooperation, discussions have been overshadowed by recent deportations of Indian nationals from the U.S. Officials say the meeting will provide political direction, with detailed trade negotiations expected to follow.

As the U.S. increasingly views India as a strategic counterbalance to China, the strength of economic ties will be closely watched in both Washington and New Delhi.

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