V Anantha Nageswaran Expresses Optimism Towards the Removal of the 25% Penal Tariff on Indian Goods

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The US recently imposed an addrioanl 25% tariff on the already existing 25% tariff on Indian goods, citing Russian oil purchase as the reason for this decision. However, according to the Chief Economic Adviser of India, V Anantha Nageswaran, the situation seems to show signs of improvement as he shares his optimistic views on the removal of the penal US tariff from India.

What Did the Indian Chief Economic Adviser Say?

V Anantha Nageswaran recently attended a gathering held by the Merchants' Chamber of Commerce & Industry in Kolkata, where he shared some interesting thoughts on US tariffs. He said, “The original reciprocal tariff of 25% plus the penal tariff of 25% were not anticipated.”

According to the Indian Chief Economic Adviser, geopolitical circumstances may have led to the imposition of the second 25% tariff. Considering the recent developments, he strongly believes that the penal tariff will not remain effective after November 30.

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He also discussed India’s export growth potential and shared some insightful data. Nageswaran mentioned that India’s current exports are valued at $850 billion and might soon reach $1 trillion, amounting to almost 25% of India’s GDP.

Not All Indian Products are Facing Heavy Duties in the US

A recent US Customs notification pointed out that while most Indian goods face heavy tariffs, a small category of goods remains unaffected by these tariffs. Products made from iron, aluminium, and steel, in particular, do not face these heavy duties in the US.

Additionally, vehicles, including SUVs, crossovers, Sedans, minivans, and cargo vans, are also exempted from these tariffs. However, a report published by the Global Trade Research Initiative (GTRI) states that the US is imposing heavy duties on about 30.2% of Indian goods, which amount to $27.6 billion. 

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To sum up, V Anantha Nageswaran is quite optimistic that the heavy tariffs on India will significantly reduce after 30 November. He also predicted that, considering the current rate of growth of Indian exports, they will soon reach $1 trillion. Furthermore, a US Customs notification also highlighted that not all Indian goods are facing heavy duties in the US. Items made from metals are especially exempted from these penal duties.