Even as Prime Minister Narendra Modi is all set to meet US President Donald Trump during his forthcoming visit to United States next week (on February 12 & 13), officials are busy exploring ways to blunt Trump’s main complaint against India – his accusation of India being a tariff king, or a country that creates tariff barriers for export of products from the US to India.

The possibility of renewed talks with the U.S for a mini-India-U.S trade is being talked about by some experts, while some maintain that India has already started work on reducing the tariff barriers when it comes to made-in-U.S products. A study conducted by India’s Central Board of Indirect Taxes and Customs (CBIC) said at least in the case of top 30 commodities that are imported from the U.S to India, the average tariffs are low.

Budget Impact

For instance, a recent analysis done by New Delhi based think tank Global Trade Research Initiative (GTRI) points out that even India’s just presented Union Budget 2025-26 has introduced significant tariff reductions on multiple products, many of which benefit American exports.

“Among the key tariff reductions, India lowered the duty on fish hydrolysate for the manufacture of aquatic feed from 15% to 5%, a move that directly impacts U.S. exports, which amounted to $35 million in FY2024. Another notable tariff cut affects Ethernet Switches (Carrier-Grade) under the 'others' category, where duties have been reduced from 20% to 10%. The U.S. exported $653.4 million worth of these products to India in FY2024, making this a significant trade benefit. Similarly, India has lowered the tariff on synthetic flavoring essences from 100% to 20%, a category in which U.S. exports stood at $21 million in FY2024,” Ajay Srivastava, founder GTRI points out.

According to GTRI study, India has reduced tariffs on ground installation for satellites, including spares and consumables, to zero, another potential area where American exporters could benefit. India had imported $92 million worth of these products from the US in FY2023, though trade activity on these fell sharply the next year.

The Budget 2025-26 had also has reduced tariffs on motorcycles based on engine capacity. For motorcycles with an engine capacity below 1,600cc, the tariff has been cut from 50% to 40%, while for motorcycles above 1,600cc, the tariff has been slashed from 50% to 30%. During his previous term as U.S President, Trump was particularly vocal about Indian tariffs on Harley Davidson motorcycles. The U.S. motorcycle exports to India stood at $3 million in FY2024, and the current tariff cut could be seen as another U.S friendly step. The Union Budget has also proposed the elimination of tariffs on specific waste and scrap items, reducing duties from 5% to zero. The U.S. exported a total of $2.5 billion worth of waste and scrap of all types to India in FY2024, GTRI notes.

“While Trump has often criticised India's tariff policies, these latest reductions signal a policy shift that could enhance U.S. exports across various sectors. With key tariff cuts on technology, automobiles, industrial inputs, and waste imports, India appears to be taking steps toward facilitating trade even as the global trade environment remains tense,” Srivastava says.

Top Commodities

According to CBIC chairman Sanjay Kumar Agarwal, the tariff on crude oil, India’s top import from the US by value was already very low as it attracts only Rs 1 per metric tonne. Similarly, the duty on steam coal and coking coal was 2.5%, and LNG, an import duty of 5% even before Budget 2025-26. He said that duty on import of airlines by India’s scheduled operators was zero and chemical and petrochemicals attracted only 7.5% duty as compared to an average of above 10% duty on industrial product imports in general.

Even if there are dozens of examples to suggest that India’s tariffs on several products imported from the U.S. are reasonable or low, the $35.3 billion trade deficit U.S had with India will always remain a point of discussion for Trump. In 2023-24, India had exported $ 77.5 billion worth of goods to U.S, while it imported $ 42.2 billion worth of goods into the country. A suggestion towards balancing this will be key to the progress of India-U.S trade talks. Modi-Trump meeting next week will be keenly watched for signals in this direction.