India Offers Zero Tariffs on 60 Percent of Goods in Historic Trade Deal Proposal to Trump Administration
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India Offers Zero Tariffs on 60 Percent of Goods in Historic Trade Deal Proposal to Trump Administration
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India has surged into the global trade spotlight after US President Donald Trump’s administration rolled out an aggressive new wave of tariffs targeting dozens of countries, including India. On April 2, Trump labeled the day “Liberation Day” for US trade policy, announcing a sweeping set of reciprocal tariffs. From April 5, a baseline 10 percent tariff on all imports took effect, but specific rates have gone much higher for some nations. For India, the new US tariff rate was set at a significant 26 percent, directly targeting major Indian exports spanning seafood, industrial metals like steel, and more. India Briefing reports that this move is part of a broader policy to recoup what Trump described as decades of unfair trade treatment by foreign nations.
Driving this shift is longstanding criticism from Trump about India’s high tariffs, which the US Trade Representative’s 2025 National Trade Estimate Report describes as the highest among major economies. In 2023, India’s most favored nation applied tariff rate averaged 17 percent, with agricultural goods attracting a striking 39 percent tariff and non-agricultural goods at 13.5 percent. Specific Indian goods like vegetable oils, apples, corn, motorcycles, automobiles, and alcoholic beverages face some of the steepest barriers. Trump has argued that while American motorcycles face tariffs as high as 100 percent in India, the US imposes only 2.4 percent on Indian motorcycles.
But in a surprising twist, negotiations have recently made headway. At a business gathering in Qatar this week, President Trump revealed that India has offered what he described as a historic trade deal. According to Trump and Reuters, India has proposed to bring tariffs on 60 percent of tariff lines down to zero in the first phase of a new trade agreement, essentially offering no tariffs on a broad array of American products. In return, India is seeking a full exemption from both existing and potential future US tariff hikes, a concession not even granted to the United Kingdom in recent US agreements.
This proposal comes as the US temporarily suspended extra tariffs on Indian exports for a 90-day period, effective until July 9, a goodwill measure to bolster ongoing negotiations. India is also reportedly offering preferential access to nearly 90 percent of goods imported from the US. Critics note that while Trump’s team touts the reciprocal nature of these tariffs, some of the figures presented by the administration include harder-to-quantify factors such as currency manipulation and non-tariff barriers, which can inflate the effective tariff rate reported in public statements.
With the 26 percent US tariff on Indian goods active unless a deal is struck and India offering zero tariffs on much of American trade, all eyes are on Washington and New Delhi. Any breakthrough could redefine the economic ties between the two nations, impacting everything from high-tech manufacturing to the price on everyday goods.
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