India gets temporary relief from US tariffs as China faces steep penalties

In a significant development that could reshape global trade alignments, India has secured a 90-day reprieve from reciprocal US tariffs, as President Donald Trump announced sweeping 125% duties on Chinese imports in response to Beijing's retaliatory actions.

The White House's decision to temporarily halt punitive tariffs on 75 countries — including India — offers New Delhi a vital window to advance its trade negotiations with Washington. The move also opens up a potential strategic advantage for India, as businesses operating in China begin exploring relocation to countries with more favorable tariff regimes.

However, the respite is not without caveats. US Treasury Secretary Scott Bessent, addressing concerns over trade policy direction, hinted that India, along with Vietnam, Japan, and South Korea, could still be subject to future tariffs. “It’s not just about China,” Bessent stated. “It’s about bad actors. The US will see.”

Calling China “the most unbalanced economy in the history of the modern world,” Bessent reinforced the administration’s hardline stance on trade imbalances and unfair practices.

In response, Commerce and Industry Minister Piyush Goyal sought to allay concerns among Indian exporters, urging calm and confidence as bilateral trade talks with the US gain momentum. “We are working on the right mix and the right balance,” Goyal said, adding that negotiations were progressing with “speed, but not undue haste.”

Goyal emphasized that India is proactively pursuing a fair and mutually beneficial agreement, underscoring the government’s commitment to achieving a sustainable outcome. The Ministry of Commerce has reportedly ramped up its efforts by strengthening the NAFTA division, responsible for trade relations with the US, Canada, and Mexico.

India and the US are currently working towards a landmark bilateral trade agreement aimed at more than doubling trade volumes — from $191 billion to $500 billion by 2023. The first phase of the deal is expected to be finalized by autumn this year.

“The minister encouraged exporters to look at the silver lining and remain focused on long-term opportunities,” read an official statement, reinforcing optimism in the face of global trade turbulence.