US President Donald Trump followed through on his reciprocal tariff threats on Wednesday by announcing a 10 per cent universal import duty on all goods brought into the US. He also slapped a 26 per cent 'discounted' reciprocal tariff on India, half of the 52 per cent imposed by the country on American goods. The reciprocal tariff will be effective from April 9, according to a statement from the White House.
As the Commerce Ministry continues to analyse the impact of the new tariffs, it is pinning hopes on the bilateral trade agreement which is being negotiated with the US. The two countries are aiming to finalise the first phase of the pact by September-October of this year.
Meanwhile, a few goods have been exempted from the tariff. Here is the list:
1) Pharma goods: Trump's 26% tariff does not cover pharmaceutical exports, in a major relief for Indian pharma giants, though experts warn the situation remains fluid as the president has discussed pharma tariffs in the past. While India charges a 10% tariff on pharma imports from the US, the latter does not impose any tariff on the same. Many Indian Pharmas, including Sun Pharma, Dr Reddy's Laboratories, derive a huge chunk of their revenue from the US.
2) Copper: The Trump administration exempted copper and steel from the latest round of tariffs. The US imported just 40 metric tons of copper concentrates and ore but some 813,00 metric tons of refined copper in 2024. However, the announcement has resulted in a 4% fall in global copper prices, which will benefit India as it is a major importer. The copper cable wire makers of India also stands to benefit from this.
3) Steel and aluminium: The White House said steel and aluminium imports will be exempted from reciprocal tariffs. However, the US buyers are already incurring 25 per cent duties on all imports of the key metals. The US accounted for 7.5 per cent of India’s total exports of steel in 2023. The move will aluminium producers like Hindalco and Vedanta.
4) Bullion: Trump's decision to exempt Bullion (physical gold and silver of high purity, often held as bars, ingots, or coins) led to Gold hitting a fresh record high on Thursday. According to the India Bullion Association, gold price in India also rose to Rs 89,350 per 10 grams as of 7:39 a.m. on April 3.
5) Energy and rate metals: The White House has announced that "certain minerals” that are not available in the US will also be exempt from tariff.
