Politics
NEW: India Offers Zero-For-Zero Tariffs In Major Trade Win For Trump
Indian officials recently offered a bold new trade proposal during closed-door meetings in Washington—one that Trump allies are already calling a major victory.
India’s latest offer includes removing tariffs altogether on U.S. steel, auto components, and pharmaceutical imports—up to a negotiated volume—on the condition that the United States does the same. The proposal, described by people familiar with the talks who spoke to Bloomberg, would revert to normal tariff levels only once that volume threshold is crossed. Negotiators are eyeing a deal as early as this fall.
The proposal came during high-level meetings late last month as both countries aim to finalize a bilateral agreement ahead of a 90-day window in which President Trump’s new tariff regime remains flexible. The Trump administration has been pressuring trade partners to ink fresh deals or risk steeper duties under the so-called “Liberation Day” tariffs, announced April 2 and enacted April 5.
Trump, on Sunday, hinted that new trade breakthroughs could be coming within days” signaling momentum behind the scenes. India appears to be near the front of the line, along with South Korea and Japan, in responding to Trump’s demands for more balanced trade. The zero-for-zero model marks a dramatic shift from India’s historically protectionist stance and signals its willingness to play ball with the U.S. on Trump’s terms.
President Trump said Tuesday that trade talks with India over tariffs were coming along great and expressed his confidence that the two countries will reach an agreement. While speaking to reporters outside the White House, Trump also mentioned plans to visit Africa and said he intends to hold discussions with officials in Australia per Reuters.
The President of United States of America (USA), Mr. Donald Trump signing Visitors book, at Hyderabad House, in New Delhi on February 25, 2020. The Prime Minister, Shri Narendra Modi and First Lady M
The offer also includes a potential compromise on India’s contentious Quality Control Orders (QCOs)—domestic regulations that have long been criticized by U.S. officials as opaque and discriminatory. These QCOs have grown from 14 before 2014 to over 140 in recent years, imposing strict benchmarks on both domestic and foreign manufacturers. According to Bloomberg, India is now willing to revisit several of these standards, especially in the chemicals and medical device sectors, and is considering a mutual recognition agreement that would allow each country to accept the other’s regulatory certifications.
While nothing is finalized, the direction of negotiations marks a significant shift and could lead to a rare diplomatic and economic breakthrough.
Trump’s trade team has spent months reshaping America’s global trade posture, culminating in a 26% retaliatory tariff on Indian imports in April, citing India’s average tariff rate of 52% on U.S. goods. That move followed the broader 10% tariff on all foreign imports under the International Emergency Economic Powers Act.
The pressure worked.
India’s diamond industry—based in the city of Surat—has been hit particularly hard, with a 17% drop in exports and growing fears of job losses. Electronics manufacturers and pharmaceutical exporters have also warned of mounting disruptions. Tariffs on Indian-made generic drugs alone could drive up U.S. healthcare costs by as much as $51 billion annually, according to industry estimates.
In a bid to deescalate, India has already lowered duties on Harley-Davidson motorcycles and bourbon whiskey, both politically symbolic U.S. exports. But the new offer goes much further and directly addresses the White House’s core complaints.
A final agreement would not only offer relief to U.S. companies and consumers but could also provide a political win for Trump, whose tough-on-trade posture has been a signature issue throughout his presidency.
Whether India’s proposals will make the final cut remains to be seen. But for now, Trump’s gamble on tariffs appears to be paying dividends—with one of the world’s largest economies signaling that it’s ready to deal.
