India's Diplomatic Strides: Trade Tensions Eased with US and EU

The reduction of US tariffs on Indian exports and a major trade agreement with the EU mark a pivotal shift in India's economic diplomacy. This reset eases tensions with the US and reinforces India's pursuit of strategic autonomy, reflecting a mature and adaptive foreign policy approach.

In a significant shift, the United States has reduced tariffs on Indian exports, which along with a monumental trade deal with the European Union, highlights a strategic reset in India's economic diplomacy. Foreign affairs expert Mahesh Sachdev stated this move mitigates earlier tensions while underscoring New Delhi's push for strategic autonomy.

According to Sachdev, the reduction from a 50% peak to 18% addresses a key bilateral irritant since the abrupt US tariff hikes in April, linked to India's purchase of Russian crude. Despite the lowered tariffs, they remain above pre-April levels of 2-3%, yet they alleviate the comparative disadvantage for Indian exporters.

The improved US-India trade dynamics, however, face uncertainties in restoring strategic trust, with past tensions driven by harsh rhetoric from the Trump administration. The reduction of tariffs also initiates dialogue for a future bilateral trade agreement, while India's own tariffs and Russian crude imports remain unchanged, prioritizing energy security for its population.