US reciprocal tariff: India to decide its response after assessing its impact, says MoS Finance Pankaj Chaudhary #IndiaFinance

In response to the US imposition of 26 per cent reciprocal tariffs on Indian imports, Union MoS Finance Pankaj Chaudhary on Thursday said that New Delhi will decide how to deal with it after assessing its impact. He further emphasised that for Prime Minister Narendra Modi, it is India first.

“For Donald Trump, it’s America First, and for Modi ji, it’s India First. We will analyse it first, then assess its impact and see how to deal with it,” the minister told reporters in New Delhi.

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His remarks came after US President Donald Trump announced reciprocal tariffs on several countries, including India, China, Bangladesh, and Sri Lanka. Among its Asian counterparts, India faced relatively lower reciprocal tariffs imposed by the US government.

The first phase of a universal 10 per cent tariff will take effect on all imports into the US starting April 5. The remaining 16 per cent, which will bring the total duty to 26 per cent for India, is scheduled to be enforced from April 10.

The Ministry of Commerce is also believed to be evaluating how the decision will affect domestic industries.

Commenting on the US move, Congress leader Shashi Tharoor said that while the full implications of it are still unknown, a 26 per cent tariff on Indian imports sounds like bad news.

“We still don’t know the full implications of all of this. Certainly, if we are at a 26 per cent tariff, then Indian exports will become less competitive. It also depends on who the competition is… We have a bilateral trade deal coming out of the negotiations; then we might be able to moderate some of the elements in the current decision announced on April 2. In the short term, a 26 per cent tariff sounds like bad news…,” Tharoor said.

The industry bodies have also reacted to the US government’s move, with PHDCCI CEO and Secretary General Ranjeet Mehta claiming that the immediate impact of the reciprocal tariff will first hit the American economy.

“Trump’s tariff announcement has sparked global discussion, but its immediate impact will first hit the American economy, making goods more expensive for consumers. For India, the pharma sector remains unaffected, which is a positive, but key export sectors like gems and jewellery, electronics, and textiles will face challenges,” Mehta remarked.

Federation of Indian Export Organisations (FIEO) President SC Ralhan said that the tariffs imposed by Trump are relatively favourable for India. He argued that it will give the country an advantage as China loses its edge in cheap raw materials.

“While the market may remain cautious, India is well-positioned to benefit… This is a crucial moment for Indian exporters to enhance production quality and maintain supply consistency, as more orders are likely to shift to India,” he stated.