JNPA and DP World to settle royalty dispute

US President Trump’s tariffs are prompting Chinese electronics companies like Haier, Lenovo, and Hisense to explore exporting from Indian factories to reduce costs. Companies are urging India’s government to ease FDI rules for smoother investment processes. Increased US-bound manufacturing in India could benefit from lower tariffs, potentially boosting trade relations between the two countries.

India is meticulously negotiating trade agreements in light of US-imposed tariffs, focusing on protecting sensitive sectors like dairy and agriculture. The government aims to prevent goods dumping from countries with steeper tariffs and provide support to impacted exporters. FTA discussions with the UK and other nations are showing good progress.

India emerges stronger in the US-India reciprocal tariffs scenario, negotiating favorable trade agreements and protecting domestic industries against dumping. The country is leveraging its bilateral talks, with New Delhi exploring measures to safeguard sensitive sectors and support impacted exporters amid escalating trade tensions.

India’s goods and services exports are estimated to surpass USD 800 billion in 2024-25, despite merchandise shipments remaining stagnant. Positive growth in merchandise exports is expected in 2025-26. The service exports saw a significant increase, reaching USD 354.90 billion during April-February 2024-25.

The India Exim Bank states the US 26% tariff on Indian imports is a mixed bag, benefiting sectors like textiles while impacting others such as automobile and steel. India could leverage this to boost its electronic exports and emerge as a hub for labor-intensive goods. A Bilateral Trade Agreement may reduce these tariffs.

India is optimistic about finalising a Free Trade Agreement (FTA) with the European Union soon. During a recent visit, Indian Prime Minister Narendra Modi and European Commission President Ursula von der Leyen directed their teams to finalise the FTA within this year. Ongoing negotiations are progressing strongly, aiming to seal the deal by this year.

The US revised its reciprocal tariff against India from 27% to 26% among changes for 14 countries. Pharmaceutical, copper, and semiconductor tariffs are expected soon. Experts believe these changes could impact the US economy, potentially slowing growth in 2025 and possibly leading to a recession.

Exporters have urged the Indian government to expedite negotiations on the Bilateral Trade Agreement with the US due to reciprocal tariffs impacting orders. They are concerned about absorbing a 26% tariff and the potential surge of dumped Chinese goods. The government is monitoring imports and supporting affected sectors.