Trump's 25% penal tariff on India may be withdrawn after November: Chief Economic Adviser
Miffed with India's oil trade with Russia, US President Donald Trump had announced additional 25% tariffs on Indian imports, that took effect in August.
The penal tariff imposed on Indian imports by the US government may be withdrawn after November 30, Chief Economic Adviser (CEA) V Anantha Nageswaran said on Thursday, expressing optimism that trade ties between the two countries will see significant improvement.
Reflecting on the tariff tensions between India and the US, the top official said developments were underway to improve the situation.
"All of us are already at work, and I will take some time to talk about the tariff here. Yes, the original reciprocal tariff of 25 per cent plus the penal tariff of 25 per cent both were not anticipated. I still believe that geopolitical circumstances may have led to the second 25 per cent tariff, but considering recent developments in the last couple of weeks and so on, I do believe that and I have no particular reason to say so it is my intuition that I do believe the penal tariff will not be there after November 30," he was quoted as saying by news agency ANI.
Miffed with India's oil trade with Russia, US President Donald Trump had announced additional 25% tariffs on Indian imports. The duties were levied on Indian goods on top of the already announced 25% reciprocal tariffs, taking the total to 50%.
CEA Nageswaran said he expects a resolution to the trade tensions in about ten weeks. "Underneath the surface, conversations are going on between the two governments. My hunch is that in the next eight to ten weeks, we will likely see a solution to the tariff imposed by the US on Indian goods," he was quoted as saying by news agency PTI.
The additional tariffs took effect on August 27. Ever since, there has been a turnaround of ties between India and the US with a positive exchange between Donald Trump and PM Modi.
Days after the additional duties on India took effect, the President's imposition of reciprocal tariffs on India and other countries was deemed unlawful by the US Appeals Court. Trump had invoked the tariffs under the International Emergency Economic Powers Act (IEEPA), a 1977 law.
However, the court held that by imposing these tariffs, Trump overstepped his authority. “The statute bestows significant authority on the President to undertake a number of actions in response to a declared national emergency, but none of these actions explicitly include the power to impose tariffs, duties, or the like, or the power to tax,” the court’s order had said.
The US Supreme Court is now on the road to resolving the case quickly, with a hearing scheduled for early November.
