Communication channels ‘open’ to resolve tariff dispute with US

The communication channels are open between India and the US to resolve the dispute over tariffs, government sources said on Wednesday, describing the issue as a temporary hiccup in their long-standing bilateral relationship.

The US imposed 50 per cent tariffs on Indian exports, effective Wednesday, with exemptions for select sectors such as pharma, electronics and petroleum products.

“Communication channels are open between India and the US to resolve the ongoing tariff issues... it is a temporary phase in a long-term relationship,” a government source said.

In a related development, US Treasury Secretary Scott Bessent, in an interview with Fox Business, acknowledged the complexity of India-US ties, but expressed optimism about finding common ground. “This is a very complicated relationship. President Trump and Prime Minister Modi share a strong rapport, and it’s not just about Russian oil,” Bessent remarked.

His comments followed the US imposing an additional 25 per cent penalty on India for its Russian oil purchases.

“India is the world’s largest democracy and America is the world’s largest economy. Eventually, we will come together,” Bessent remarked. He, however, added that the US has advantage in ongoing trade talks with India.

“The US is a deficit country. When there is a schism in trade relations, the deficit country has the advantage. It’s the surplus country that should worry. Indians are selling to us. They have very high tariffs and we have very large deficit with them,” Bessent said. India has over $40 billion trade surplus with the US.