US tariff impact to depend on comparative tariffs on India's competitors: Government to Parliament

New Delhi: The impact of American tariffs on exports to US in various sectors will depend and vary based on comparative tariffs on other countries including the competitors, the government told Parliament Tuesday.

“The Department of Commerce is engaged with stakeholders to help reduce the impact through export promotion and diversification measures,” minister of state, commerce and industry ministry Jitin Prasada told Lok Sabha in a written reply.

India-US bilateral trade agreement (BTA) negotiations were launched in March 2025 and five rounds of negotiations have been held, the last being from July 14-18 2025 in Washington.

“India is actively engaged in the negotiations with the US and the European Union…Government of India is involved in the discussions on the India-US BTA with the aim to expand trade and investment and deepen the India-US trade relationship to promote growth that ensures fairness, national security and job creation,” he said.

In another reply, the commerce and industry ministry said that the US, since January 2025, has imposed additional tariffs at varying rates on imports from all countries citing reasons related to trade deficits, illegal movement of drugs, and border security, among others.

“However, as on date no additional tariff has been imposed by the US based on any partner country's membership of BRICS. Government continues to monitor the impact of the additional tariffs imposed by the US on exports from India,” he said.

The government, he said, is engaged with all stakeholders including exporters and industry for taking feedback of their assessment of the impact from the reciprocal tariffs imposed by the US.

“Government attaches utmost importance to protecting and promoting welfare of farmers, workers, entrepreneurs, exporters, MSMEs and all sections of industry,” he added.

Asean trade

India and ASEAN are “constructively engaged” on review of ASEAN-India Trade in Goods Agreement (AITIGA), signed in 2009 and so far, nine meetings of AITIGA Joint Committee meetings have been held. The 10th round is scheduled from August 10-14, 2025.

Retail policy

The draft National Retail Trade Policy has been prepared and focuses on preparing strategies for overall development of retail trade through targeted efforts to promote ease of doing business in retail sector through several measures to reduce compliance burden, enhance ease of access to credit and decriminalization of minor offences for all formats of retail trade.

Special emphasis is placed on assessing the requirement of licenses, removal of renewal requirement, inspection reforms, facilitating public service delivery and creation of single window facilitation mechanism, Lok Sabha was informed.

Calibrated FTA

India has adopted a calibrated approach to negotiating FTAs to expand market access while protecting domestic interests, the government said

“Revenue is notionally impacted for both the partner countries of the FTA with tariff reductions. This is expected to be offset in the medium to long term by increased trade volumes, investment flows, enhanced competitiveness of Indian exports, and overall economic growth,” government told Lok Sabha.

The India-UAE FTA has also led to a significant growth in Foreign Direct Investment.

Export promotion

The Export Promotion Mission (EPM) which was announced in the Union Budget 2025-26, is currently at the proposal stage. The EPM proposal includes provisions for third-party evaluation to assess outcomes and inform further improvements. Monitoring and evaluation mechanisms have been built into the proposal to ensure effective execution, stakeholder responsiveness, and transparency.