US suspends additional 26% tariffs on Indian goods until July 9: White House

This decision comes as a significant relief to Indian exporters, particularly in the semiconductor, pharmaceutical, and energy sectors.  The US has announced the suspension of additional tariffs on India for 90 days until July 9 this year, according to the White House executive orders. On April 2, US President Donald Trump imposed universal duties on about 60 countries exporting goods to America and additional steep levies on countries like India, potentially impacting sales of products from shrimp to steel in the world’s biggest economy. The move was aimed at cutting the country’s trade deficit and boosting domestic manufacturing.

The US imposed an additional import duty of 26 per cent on India, and the tariffs were high on its competitors, such as Thailand, Vietnam, and China. “Effective with respect to goods entered for consumption, or withdrawn from warehouse for consumption, on or after 12:01 a.m. eastern daylight time on April 10, 2025, enforcement of the second paragraph of section 3(a) of Executive Order 14257 is suspended until 12:01 a.m. eastern daylight time on July 9, 2025,” the order said.

The second paragraph of Section 3 (a) of the executive order issued on April 2 mentions the implementation of reciprocal tariffs. It includes Annex 1 listing tariff rates for different countries. However, the 10 per cent baseline tariff imposed on the countries will continue to remain in place. “Since I (President) signed Executive Order 14257, in contrast to the PRC’s actions, more than 75 other foreign trading partners, including countries enumerated in Annex I to Executive Order 14257, have approached the United States to address the lack of trade reciprocity in our economic relationships and our resulting national and economic security concerns. “This is a significant step by these countries toward remedying non-reciprocal trade arrangements and aligning sufficiently with the United States on economic and national security matters,” the order dated April 9 said.

A trade expert said the 25 per cent duty on steel, aluminium (effective from March 12), auto and auto components (from April 3) also continues.

Federation of Indian Export Organisations (FIEO) Director General Ajay Sahai said that semiconductors, pharmaceuticals, and certain energy products are under the exemption category. Commenting on the 90-day deferral of reciprocal tariffs, Indian exporters said the US decision has come as a major relief as it provides a crucial window for pushing the talks on the proposed bilateral trade agreement between India and America. They said diplomatic engagement and fast-tracking negotiations for the trade pact will help India deal with these tariffs.

“It is a good decision by the Trump administration. We have been assured by the commerce ministry that the agreement will be finalised at the earliest,” FIEO President S C Ralhan said. Amid a global market meltdown, Trump on Wednesday (9 April ’25) abruptly backed down on his tariffs on most nations for 90 days but raised the tax rate on Chinese imports to 125 per cent.

In a meeting with industry and exporters on April 9, Commerce and Industry Minister Piyush Goyal asked exporters not to panic and assured them that India is working on the “right mix and right balance” in its proposed trade agreement with the US.He said the Indian team is working with “speed” but not in “undue haste” to ensure the right outcome for the country.

The two countries are negotiating a bilateral trade agreement (BTA) to more than double their trade to USD 500 billion by 2023 from about USD 191 billion at present. They aim to conclude the first phase by the fall (September-October) this year.