As the United States rolls out steep reciprocal tariffs under President Donald Trump’s administration, India is working hard to strike a balanced trade deal to soften the blow. On April 6, 2025, with Trump’s latest 27% tariff on Indian imports in full swing—announced earlier this week on April 2—India’s trade officials are deep in talks with their U.S. counterparts, aiming to finalize the first phase of a bilateral agreement by autumn. It’s a high-stakes move to keep trade flowing smoothly between the two nations, even as global markets reel from the tariff shock.
The talks kicked off in earnest last month, with Indian and U.S. negotiators meeting in New Delhi from March 26-29. Led by India’s commerce ministry and a U.S. team headed by Assistant U.S. Trade Representative Brendan Lynch, the discussions zeroed in on cutting tariffs, easing non-tariff barriers, and boosting market access for both sides. India’s hoping to dodge the worst of Trump’s trade war, which he’s pitched as a fix for the U.S.’s $46 billion trade deficit with India. The U.S. says India’s 12% average tariff—way higher than America’s 2.2%—is unfair, and Trump’s been calling India a “tariff king” for years.
So, what’s on the table? India’s ready to lower tariffs on over $23 billion worth of U.S. imports—think electronics, gems, and jewelry—hoping to dodge retaliatory levies that could hit its exporters hard. In return, India wants more U.S. goods flowing in, like oil, gas, and defense gear, plus a shot at doubling bilateral trade to $500 billion by 2030. Prime Minister Narendra Modi and Trump hashed out the basics during a February meeting at the White House, agreeing to wrap up this first chunk by fall. “We’re focused on fairness and growth,” India’s trade ministry said, hinting at a deal that benefits both without rocking the boat too much at home.
It’s not all smooth sailing, though. Trump’s tariffs, which also slap 34% on China and 46% on Vietnam, are shaking up global trade. India’s electronics sector—$14 billion in exports to the U.S.—and its $9 billion gems and jewelry trade are feeling the heat, though pharma exports got a lucky break with an exemption. The Indian rupee’s holding steady, up 0.08% against the dollar, and some say India’s lower tariffs compared to rivals like China could give it an edge. Still, local industries are nervous—cutting tariffs too fast could flood markets with cheap U.S. or even Chinese goods, hurting homegrown manufacturers.
India’s playing it smart, not swinging back with its own tariffs like some nations. Instead, it’s negotiating—offering concessions like slashing duties on bourbon whiskey and high-end motorcycles last month, while pushing for U.S. goodies like F-35 jets and nuclear tech. “We’re studying the impact and looking for opportunities,” the trade ministry said, with a bilateral committee already meeting U.S. officials this week to hammer out details. Commerce Minister Piyush Goyal’s been a regular in Washington, meeting U.S. Trade Rep Jamieson Greer and Commerce Secretary Howard Lutnick to keep the talks alive.
The stakes are sky-high. Trump wants India to open up agriculture—a tough ask with India’s small farmers in mind—and shift defense buys from Russia to the U.S. Modi’s got domestic heat to dodge too; looking soft on trade could sting his tough-guy image. But with both leaders calling each other “smart” and “friends,” there’s hope they’ll land a deal that keeps the peace—and the profits—flowing. For now, India’s betting on talks over tit-for-tat, aiming to turn Trump’s tariff storm into a chance to shine.