The United States of America (USA) has recently announced some significant declarations concerning various other countries including India. They have announced tariff breaks which will allow exporters from India to export their goods and services without bearing heavy financial burden. This decision is expected to smoothen the trade relations between USA & India so that both the countries can benefit from each other and grow exponentially.
Read the article to learn more details about the new decision concerning tariff breaks and its specifications and impact on India.
What Is The Decision Regarding Tariff Break?
The President of the United States of America (USA), Donald Trump, has declared a major decision affecting not only India but other countries too. USA has decided to give a 26% tariff break to Indian exports till July 9th, 2025.
What Is The Reason Behind This Announcement?
The conditions of trade relation between USA & India have been on the rocky road since a long time. In the year 2018, the US applied tariffs of 25% on steel and 10% on aluminum imports allegedly due to national security concerns; as a response, India applied tariffs on 28 products coming from the USA, like almonds, walnuts, and apples.
The situation was worsened when, in the year 2020, India introduced a 2% Digital Services Tax (DST) on foreign digital companies earning in India. The US felt and took it as a personal attack against its big companies like Amazon, Google, and Facebook and responded by imposing extra tariffs on over 25 Indian products such as shrimp, basmati rice, gold jewelry, and furniture.
How Will This New Decision Affect Indian Exporters?
The 26% tariff break will benefit the Indian exporters and will save them from paying hefty amounts on tax duties till July 9th, 2025. Exporters will be able to export more Indian products, ranging from shrimps and basmati rice to gold jewelry and furniture. Indian goods, especially those manufactured by Micro, Small, and Medium Enterprises (MSMEs), will be able to reach a global market.
Please note that the decision of tariff breaks is not only for India but other countries as well, except China.
Conclusion
The USA’s decision concerning tariff breaks to India and other countries is an exceptional decision that will not only benefit the Indian exporters but also improve international relations, especially between the USA and India, considering the past feud. The United States of America has also hinted at the idea of giving tariff concessions to India again under the Generalised System of Preferences (GSP). We can all expect healthy and fruitful relations to be formed between India and USA for the foreseeable future.
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