US May Scrap 25% Penal Duty on India, Cut Other Tariffs to 10-15%: CEA
Chief Economic Adviser (CEA) V. Anantha Nageswaran said on Thursday that he expects the United States to withdraw the recently imposed 25% penal tariff on Indian goods by the end of November . Speaking at an event in New Delhi, the CEA also indicated that the existing 25% reciprocal duty could be reduced to a band of 10-15%, offering potential relief from a double-layered tariff regime that has battered key export sectors .
“I do believe that the penal tariffs will not be there beyond November 30,” Nageswaran stated, adding that he sees a resolution to the overall tariff dispute in the next 8 to 10 weeks . While stressing that this was his personal assessment and not based on any formal assurance, his comments have sparked optimism for a breakthrough in the trade standoff .
The remarks follow a recent meeting between senior trade negotiators from both countries, the first since the Trump administration imposed the steep additional tariffs in August, citing India’s continued energy trade with Russia .
The combined tariffs, reaching as high as 50% on some products, have severely impacted the competitiveness of Indian goods in labour-intensive sectors like textiles and engineering . According to one think tank, India could lose $30-35 billion in US exports if the tariffs remain in place through the fiscal year . A rollback would ease significant cost pressures and restore a degree of predictability to one of India’s most critical trade relationships .
While New Delhi has been pushing for a negotiated settlement, officials acknowledge that the outcome may also be influenced by US domestic politics . For now, Indian industries will be closely watching to see if the CEA’s optimistic timeline for a tariff rollback materializes in the coming weeks.
