Indian Tariffs on U.S. Trade Weigh Heavier Than Vice Versa

U.S. trade representatives are visiting India this week for talks as the Trump administration's reciprocal tariff deadline on April 2 is looming large. At the same time, Reuters reported Tuesday that India was open to cutting tariffs on more than half of U.S. imports as part of a trade deal both countries have been negotiating. India is charging very high tariffs on foreign goods, much exceeding - for example - the tariffs that the United States levies on Indian imports. Reciprocal tariffs, as threatened by Trump, would therefore increase tariff burdens for Indian companies exporting to the U.S. by a lot. Some observers think that even if a deal is not cut before April 2, India could be exempt for the time being as talks are underway.

As a first phase of the deal, India would "substantially" lower the tariffs it charges on $23 billion worth of incoming U.S. goods (equal to 55 percent of imports). India charges especially high tariffs on agricultural goods, automobiles, precious metals and textiles, data analyzed by Reuters shows. At the moment, the weighted average tariff rate of India is 12 percent, while it is 2.2 percent in the United States. This places India among the countries with the highest tariff rates in the world.

While these numbers change when looking at U.S.-India trade due to the specific categories exchanged, the burden on the U.S. is still much higher than vice versa. Despite India sending goods to the U.S. which are worth more than double those that the U.S. is shipping to India, both countries paid a comparable amount of tariffs in 2024.