Trump's 25% penal tariff may soon be withdrawn

New Delhi: Chief Economic Adviser (CEA) V Anantha Nageswaran on Thursday said the penal tariff imposed on Indian imports by the US government could be withdrawn after November 30, adding that he was optimistic about a marked improvement in trade relations between the two countries.

Commenting on the tariff dispute between India and the US, the senior official noted that steps were being taken to ease the situation.

"All of us are already at work, and I will take some time to talk about the tariff here. Yes, the original reciprocal tariff of 25 per cent plus the penal tariff of 25 per cent both were not anticipated. I still believe that geopolitical circumstances may have led to the second 25 per cent tariff, but considering recent developments in the last couple of weeks and so on, I do believe that and I have no particular reason to say so it is my intuition that I do believe the penal tariff will not be there after November 30," he was quoted as saying by news agency ANI.

CEA Nageswaran expressed confidence that the trade tensions could be resolved within about ten weeks. "Underneath the surface, conversations are going on between the two governments. My hunch is that in the next eight to ten weeks, we will likely see a solution to the tariff imposed by the US on Indian goods," he was quoted as saying by news agency PTI.

Upset over India’s oil trade with Russia, US President Donald Trump had imposed an additional 25 per cent tariff on Indian imports. This came on top of the earlier 25 per cent reciprocal tariff, raising the total duty to 50 per cent.