In a strategic move to protect its export sector, India is contemplating reducing tariffs on over half of U.S. imports, amounting to approximately $23 billion. This initiative aims to mitigate the potential adverse effects of impending reciprocal tariffs from the United States, which are scheduled to commence on April 2.

An internal assessment by Indian authorities indicates that the forthcoming U.S. tariffs could impact around 87% of India's exports to the United States, valued at $66 billion. The sectors most vulnerable include pharmaceuticals and automotive industries, which are heavily reliant on the U.S. market. The anticipated tariff increases range between 6% and 10% on key export items such as pearls, mineral fuels, machinery, boilers, and electrical equipment.

India is considering lowering tariffs on 55% of U.S. goods it imports, which currently face duties between 5% and 30%. This reduction would encompass U.S. imports worth over $23 billion, with the possibility of substantial cuts or complete removal of tariffs on certain products. However, this proposal is contingent upon the United States providing relief from the impending reciprocal tariffs.

Negotiations are set to commence, led by Assistant U.S. Trade Representative Brendan Lynch. India's willingness to adjust tariffs is aimed at securing favorable terms and averting the extensive impact of the U.S. tariffs. While open to significant tariff reductions, India intends to protect specific sectors, notably agriculture. Tariffs on products such as meat, maize, wheat, and dairy, which currently range from 30% to 60%, are likely to remain unchanged. Conversely, tariffs on items like almonds, pistachios, oatmeal, and quinoa may be eased.

This development follows recent discussions between U.S. President Donald Trump and Indian Prime Minister Narendra Modi, where both nations agreed to initiate talks to resolve trade and tariff disputes. India has committed to increasing purchases of U.S. oil, gas, and military equipment, aiming to conclude a preliminary trade deal by fall 2025. Additionally, Prime Minister Modi announced that the U.S. and India are targeting a bilateral trade volume of $500 billion by 2030.

As both countries navigate these complex negotiations, the outcomes will significantly influence their economic relationship and set precedents for future trade agreements.