India-US Trade: Penal 25% Tariff May Be Withdrawn By End Of November, Says CEA Nageswaran

Chief Economic Advisor V Anantha Nageswaran on Thursday expressed belief that the penal tariff levied by Washington over India's ties with Russia is likely to be withdrawn by Nov. 30, considering recent developments on the trade front and easing economic conditions.

The original 25% tariff, as well as the penal addition were both unexpected, said Nageswaran at an event by the Merchants' Chamber of Commerce & Industry in Kolkata.

"I still believe that geopolitical circumstances may have led to the second 25% tariff," said Nageswaran. However, considering recent developments, he reiterated his conviction stating, "I do believe the penal tariff will not be there after Nov. 30," reported news agency ANI.

"I do believe that there will be a resolution in the next couple of months on the penal tariff and hopefully on the reciprocal tariffs," he further stated.

To this end, India and the US had recently agreed to step up efforts to conclude a mutually beneficial trade agreement at the earliest, following discussions between trade teams in New Delhi on Tuesday.

Talks, described as "positive and forward-looking" by the Indian Commerce Ministry, covered multiple aspects of the proposed deal, with both sides reaffirming their commitment to a balanced and mutually beneficial outcome.

"It was decided to intensify efforts to achieve early conclusion of a mutually beneficial Trade Agreement," the Commerce Ministry said in a statement.

The US Embassy also called the meeting positive after US chief negotiator Brendan Lynch and other American officials met their Indian counterparts after a planned late August meeting was stalled.

The trade negotiations come in the backdrop of the Trump administration's steep tariff on Indian goods which includes the penal 25% levy for purchasing Russian oil that New Delhi has slammed as 'unjustified'.