In 2025, India has proposed a substantial reduction in its tariff gap with the United States, aiming for less than 4%, a significant decrease from the current nearly 13%. This offer is contingent upon receiving an exemption from President Donald Trump's existing and potential tariff increases.
The proposed reduction would lower the average tariff difference between the two countries by 9 percentage points across all products. This move signifies a considerable effort to reduce trade barriers within the world's fifth-largest economy.
In exchange, India seeks preferential market access for key export sectors and treatment on par with top U.S. allies in critical technology sectors. A delegation of Indian officials is expected to visit the U.S. later this month to advance negotiations.
US President Donald Trump announced on Tuesday, May 6, 2025, that India has agreed to reduce its tariffs on imports from the United States to "nothing". This statement was made amid ongoing negotiations for a bilateral trade deal aimed at boosting bilateral trade to $500 billion by 2030.
India has offered preferential access to nearly 90% of goods imported from the United States, including the reduced tariffs. To make the deal more attractive for Washington, India has offered to ease export regulations on several high-value US exports. These include aircraft and parts, luxury cars and electric vehicles, telecom equipment, medical devices, hydrocarbons, wines and whiskey, berries, prunes, certain chemicals, and animal feed.