India in talks with US on steel, aluminum tariff exemption, say sources

According to three Indian sources, India is in negotiations with the US to seek an exemption from steel and aluminium tariffs imposed by former US President Donald Trump, as well as the removal of some retaliatory levies.

Negotiators in New Delhi and Washington want to strike a deal during Indian Prime Minister Narendra Modi’s visit to the United States later this month, according to two Indian government officials and one industry source with firsthand knowledge of the situation.

According to both official sources, India has offered to drop retaliatory duties on select agricultural items such as almonds and walnuts in exchange for exemption from steel tariffs.

However, US negotiators were not “flexible”, leading to doubts over a possible exemption on tariffs on steel, one of the sources said.

“We are discussing, (but) they are not very flexible whether there will be any substantial outcome,” the government source said, declining to be identified.

India’s trade ministry, the Office of the US Trade Representative and the US Department of Commerce did not reply to mail seeking comment.

The Indian officials did not want to be named as they were not authorised to speak to media.

“PM (Modi) is visiting and by that time, they (US) want to come up with something good, which looks positive for both sides,” one of the government source added.

India is willing to discuss other possible trade measures that the US officials may propose, the second government source said.

A top executive at a US industry group said he was not aware of “any serious contemplation” on the part of the US government on the tariff issue and said it was unlikely that they would consider such a request.

“I really don’t think the US government would do that, quite frankly,” said Kevin Dempsey, president of the industry trade group American Iron and Steel Institute.

Trump had imposed 25 per cent tariff on steel and 10 per cent on aluminum in 2018, using Section 232 of a 1962 act that allows the president to restrict imports.

In retaliation, India had imposed tariffs on 28 US products, including almonds, apples, and walnuts.

Last December, The World Trade Organization ruled that US tariffs imposed on steel and aluminium imports by Trump contravened global trading rules, a judgment criticised by Washington.

Separately, at a US Congressional Steel Caucus hearing on Wednesday, several steel industry leaders expressed support for keeping the tariffs in place.

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