India may withdraw its decision to impose higher tariffs on US imports. Last week, India finally imposed higher tariff rates on 29 import items from the US, aimed at raking in $240 million worth of duties through higher tax up to 100 per cent. India’s list of tariffs targeted agro commodities such as apples, walnuts, and almonds, for which the US remains the largest source of inbound shipments.

India is also hopeful of securing exemption from the US on steel and aluminium tariffs, which had been imposed earlier by the US against all trade partners. The US may accede to the demands on exemption from tariffs as exports to the US in the category remain small.
Tariff hikes raise new trade barriers, make domestic manufacturing more attractive as the steep increases in customs duties make imports unaffordable. For agri products such as pulses, which have witnessed an increase from 30 per cent to 70 per cent, this would provide encouragement in increasing the cultivable area, on the back of good pulse production in recent years in India.