New Delhi: After the historic India-US trade deal announcement on Monday, February 2, New Delhi will deal with lower tariffs compared to its regional export competitors in Southeast Asia and South as the Trump administration reduced the tariffs on Indian goods to 18 per cent.
India has a significant edge over competing export economies in the region with the introduction of a new tariff structure compared to Indonesia’s 19 per cent and Bangladesh’s 20 per cent each.
On the other hand, China’s Beijing is enjoying tariffs at 34 per cent. India also has an edge over its arch-rival Pakistan, as the tariffs on Islamabad are currently levied at 19 per cent.
Earlier, the tariff was 50 per cent, including a 25 per cent reciprocal tariff and an additional 25 per cent import duty imposed on India’s purchase of crude oil from Russia. But now, in the new India-US trade deal, all the extra penalties have been cut off.
Higher tariffs:
China: 37 per cent
Brazil: 50 per cent
South Africa: 30 per cent
Myanmar: 40 per cent
Laos: 40 per cent
Lower tariffs:
European Union: 15 per cent
Japan: 15 per cent
South Korea: 15 per cent
Switzerland: 15 per cent
United Kingdom: 10 per cent
Comparable rates in Southeast Asia:
Bangladesh: 20 per cent
Vietnam: 20 per cent
Malaysia: 19 per cent
Cambodia: 19 per cent
Thailand: 19 per cent
Pakistan: 19 per cent
India’s new trade deal with the US will place it in a comfortable position with a competitive rate.
US President Donald Trump announced the historic deal with India in his trademark style as he wrote, “It was an honour to speak with Prime Minister Modi… we spoke about many things, including trade and ending the war between Russia and Ukraine.”
Trump also confirmed that India has agreed to stop buying oil from Russia and will purchase it from the US and, potentially, Venezuela, which will ultimately end the war in Ukraine, according to him.