Daily News - Friday, 25 April 2025

⁠India may be first to sign trade deal, says US Treasury Secretary Bessent (The Indian Express)

India is on track to become the first country to finalize a bilateral trade agreement (BTA) with the US, potentially avoiding the 26% reciprocal tariffs currently paused until July, as US Treasury Secretary Scott Bessent praised India’s relatively low tariffs, minimal subsidies, and absence of currency manipulation. The proposed deal, initiated during PM Modi’s February visit to Washington, aims to more than double bilateral trade from $190 billion to $500 billion by 2030, with chief negotiators from both countries meeting in Washington this week to finalize an interim agreement before the tariff pause expires. India still faces a 10% general tariff under current US trade policy, but Finance Minister Nirmala Sitharaman expressed confidence in concluding the first tranche of the BTA by fall 2025. 

T.N. weaving clusters expect cheaper Chinese rayon yarn amid U.S. tariffs (The Hindu)

Powerloom weavers in Tamil Nadu’s Palladam and Erode regions are anticipating cheaper Chinese viscose yarn, priced ₹8–₹10/kg less than domestic yarn, following the 145% U.S. tariff on Chinese goods, which has made Chinese viscose more accessible to Indian markets. The landed cost of Chinese viscose yarn has already dropped from ₹192.17/kg on April 1 to ₹185.06/kg by April 23, compared to ₹197/kg for Indian yarn, although traders require upfront payments and bulk purchases, reducing the effective advantage to around ₹4/kg. While large weaving units may benefit, domestic viscose yarn producers are demanding import restrictions and regulatory parity to protect their market from the expected surge in cheaper Chinese imports.

Jolted by U.S. tariffs, stainless steel players turn to local market (The Hindu)

Following the imposition of a 25% U.S. tariff on steel and aluminium, Indian stainless steel exporters, with 10–15% of production previously bound for the U.S., are now redirecting supply to the domestic and Middle East markets amid uncertainty and halted business conversations. Industry leaders warn that Chinese steel dumping could further strain the Indian market, with the full impact expected to become clearer in 3–4 months, and key deliberations scheduled for the GSSE Summit in June 2025. Despite external disruptions, rising domestic demand, driven by increased use of stainless steel in infrastructure, railways, and processing industries, offers a buffer for the sector. 

India weighs trade halt with Pakistan as tensions escalate (mint)

⁠India is considering a complete halt to trade with Pakistan following the Pahalgam terror attacks, which would impact Pakistan’s access to essential imports like pharmaceuticals, sugar, and chemicals, with Indian exports having already surged 127% to $1.21 billion in 2024 from $530.91 million in 2023. Despite trade comprising just 0.06% of India’s total international trade ($500 million of $800 billion from April 2024–January 2025), the move is expected to intensify economic pressure on Pakistan, especially as India explores third-country cooperation to block indirect trade routes. In retaliation, Pakistan has suspended all bilateral agreements and closed its airspace to Indian aircraft, escalating tensions as India also considers suspending the Indus Water Treaty and diplomatic ties. 

‘Policy change for foreign EV cos hinges on US trade deal’ (mint)

India is considering revising its EV manufacturing policy, particularly import tariffs, under the ongoing India-US bilateral trade agreement talks, which could pave the way for Tesla’s entry via reduced duties under the March 2024 SPMEPCI scheme that allows import of up to 8,000 fully built EVs at a lowered 15% duty for five years (compared to 70–80% standard rates). This follows PM Modi’s discussions with Elon Musk and comes amid broader trade negotiations, where the US has flagged India’s high tariffs and regulatory inconsistencies, while pushing for greater market access and reciprocity. Meanwhile, the US has introduced a 10% base tariff on foreign goods and a 25% tariff on foreign-made cars, citing the need to protect American industries, with both sides now working to address trade barriers in digital trade, customs, and automotive sectors.