India set to levy higher tariffs on some US goods next week

As trade tensions heat up between the US and India the leaders of both countries are scheduled to meet on the sidelines of the G20 summit later this month

As trade tensions heat up between the US and India the leaders of both countries are scheduled to meet on the sidelines of the G20 summit later this month

From June 5, President Donald Trump scrapped trade privileges under the Generalised System of Preferences (GSP) for India, the biggest beneficiary of a scheme that allowed duty-free exports of up to $5.6 billion from the country.

Tariffs on apples, almonds, shrimps, chickpeas, boric acid and some other items imported from the USA are set to go up as the government has finally made a decision to impose retaliatory duties worth over $200 million on 29 products, a government official has said.

"The duty hikes will come into effect in normal course as the notification to postpone the hikes will expire on Saturday night". India's move to impose retaliatory tariffs comes 10 days before foreign minister S Jaishankar is to meet USA secretary of state Mike Pompeo, the first high-level interaction after the new Modi government took over.

These deadlines were extended several times since June 2018, when India made a decision to impose these duties in retaliation to a move by the United States to impose high customs duties on certain steel and aluminium products.

"There will be no further extension of the retaliatory tariffs", said an official aware of the development, adding that the commerce department and external affairs ministry are on the same page on the decision.

Previously, India has called the withdrawal of GSP benefits "unfortunate", and vowed to "always uphold its national interest in these matters".

India's exports to the USA in 2017-18 stood at Dollars 47.9 billion, while imports were at USD 26.7 billion.

India's proposed move to put in place retaliatory tariffs comes just a few days ahead of the scheduled visit of US Secretary of State Mike Pompeo, who is expected to discuss defence and trade issues with Minister of External Affairs S Jaishankar. Trump has often termed India a "tariff king" and repeatedly pointed to the 50% duty that India imposes on imports of Harley-Davidson motorcycles. The trade balance is in favour of India.

India's Ministry of Commerce and Industry did not respond to an email from Reuters seeking comment. India is no more an underdeveloped or least developed country that we will look at that kind of support.

In March, the U.S. had announced its decision to withdraw the preferential duty benefits to India after talks between the two sides broke down on "disproportionate" demands by Washington. This had raised hopes that the two sides may re-engage to try and resolve their differences after the Modi government took charge. The increase in import duties will be effective from June 16.