NEW DELHI: Rebutting “tariff king” charge against India, finance minister Nirmala Sitharaman on Tuesday said free trade agreements (FTAs) with the United States and the European Union (EU) could materialise soon, and would empower Indian exporters and foster export-led growth.
In the Budget for 2025-26, the minister said, the government rationalised customs tariff structure for industrial goods to remove seven tariff rates, reducing the total to just eight, including “zero rate.” This has brought down the overall tariff levels.
“For those of us who still believe in the commentary which was made in the US that India may be the tariff king…. No, I want two things to be remembered. Given our systems, we seek Parliamentary approval for deciding on the tariffs,” she said, speaking at the India EXIM Bank Trade Conclave here.
The government obtains Parliament’s permission to go up to a certain level of (bound) tariffs, even though the effective rates are at a far lower level. ”But, what gets published in the gazette would be that level for which you obtain permission from Parliament, and it is that level which appears everywhere.. people then tend to think, that’s the rate at which we are imposing tariffs,” she said.
“So, our procedures have given us that not-so-desirable picture of being very, very restrictive and regressive about tariffs,” she added.
US President Donald Trump had branded India as a “tariff king” on many occasions in the past few months.
Sitharaman said the government has taken five major initiatives to help the Indian exporters: transport and logistics upgradation, targeted support to MSMEs, trade finance access, trade cluster development and more FTAs being negotiated.
India has already signed FTAs with the United Arab Emirates (UAE) and Australia, while a similar pact with the 4-nation EFTA (European Free Trade Association) bloc will likely come into force later this year. Negotiations have also been completed with the UK for an FTA.
“With the US and the EU, negotiations are going on (in full swing) and should come to a conclusion soon. So, emphasis is being made for getting more free trade agreements signed,” she said.
India’s total exports, goods and services combined, reached an all-time high of $825 billion in 2024-25, achieving 6% growth over the previous year, and a significant leap from $466 billion in 2013–14. India has deepened participation in global value chains. Apple India’s iPhone contract manufacturers have crossed the 20% domestic value addition threshold across variants, she said.
Source: The Financial Express
