'Zero-for-Zero' Tariff Deal Unlikely in India-US Trade Talks: Report

A 'zero-for-zero' tariff approach in the suggested bilateral trade deal between India and the US is improbable, given that the two nations are at varying stages of economic advancement, according to official sources.

Some trade specialists have recommended that India might offer a 'zero-for-zero' tariff approach to the US to tackle America's reciprocal tariff increases.

An official stated that zero-for-zero tariffs could be feasible between the US and the European Union (EU) since both are advanced and developed countries.

The India-US agreement will always be a "package" deal that could include issues such as goods and non-tariff barriers, the official said adding "it does not happen like this that if he will do 'zero' in electronics, we will also do in electronics. Trade agreements do not happen like this. It is a wrong thinking".

In a trade agreement, two nations either greatly reduce or eliminate customs duties on the highest number of products exchanged between them. They also relax regulations to encourage service trade and enhance investments.

As the US considers duty reductions in areas such as specific industrial goods, automobiles (especially electric vehicles), wines, petrochemicals, dairy, and agricultural products like apples, tree nuts, and alfalfa hay; India may explore duty reductions for labour-intensive industries including apparel, textiles, gems and jewellery, leather, plastics, chemicals, oilseeds, shrimp, and horticultural products.

The US represents approximately 18 percent of India's overall goods exports, 6.22 percent in imports, and 10.73 percent in bilateral trade