Communication channels between India and the US are open to resolve the ongoing tariff issues, and the glitch in trade ties is only temporary, given the long-term relationship between the two nations, government sources said on Wednesday. The US' 50 per cent tariffs on Indian exports to America came into effect from August 27, barring a few sectors.
Foreign portfolio investors (FPIs) withdrew a substantial amount from Indian equities in the first half of March, driven by geopolitical tensions, rupee depreciation, and concerns about crude oil prices.
'Trade deal will act as a strong trigger for market sentiment, not just for domestic investors but also for FIIs.'
Benchmark indices Sensex and Nifty ended marginally higher on Wednesday as a sharp decline in IT blue-chip stocks restricted the rally in the markets.
With US President Donald Trump "temporarily suspending" country-specific reciprocal tariffs until July 9, India sees the three-month window as an opportunity to renew its push for a proposed bilateral trade agreement (BTA) with the US and expedite finalisation of the first tranche of the trade deal.
From the 30-Sensex firms, Trent, Larsen & Toubro, Reliance Industries, InterGlobe Aviation, Maruti, ITC, Adani Ports and Bharat Electronics were among the biggest laggards. In contrast, Eternal, ICICI Bank, Tech Mahindra, State Bank of India and Tata Consultancy Services were among the gainers.
Meeks, a ranking member of the House Foreign Affairs Committee Democrats, on Wednesday (local time) underscored "Congress' support for the US-India partnership," following his meeting with Indian Ambassador to the US Vinay Mohan Kwatra.
"I understood tariffs better than any human being in the world. And now with my tariffs, they were all dropping them. India was the most highly tariffed nation... And you know what, they've offered me no tariffs in India anymore. No tariffs," Trump said.
The rupee witnessed a volatile trading session and settled for the day on a slightly lower note, down 1 paisa at 90.66 against the US dollar on Monday, as traders assessed the details of the India-US interim trade framework.
The US' move to raise the tariff on most Indian goods to 50 per cent could drag India's GDP growth for FY26 by 35 to 60 basis points, according to various economists. One basis point (bp) is equal to 0.01 per cent.
India's computer services exports have risen 30 per cent since the advent of ChatGPT in November 2022, even as overall services exports have plateaued, World Bank's South Asia Chief Economist Franziska Ohnsorge said, terming Artificial Intelligence (AI) and the conclusion of more trade agreements that can trigger a "manufacturing renaissance", as the two big investment opportunities for India in coming years.
Senior Congress leader Shashi Tharoor says US tariffs are negatively impacting India, leading to job losses, and criticizes President Trump's diplomatic behavior.
The US has temporarily permitted India to accept Russian oil already on ships to ensure energy supplies amid the conflict with Iran. This short-term measure is not expected to significantly benefit Russia financially.
Congress leader Rahul Gandhi has accused Prime Minister Narendra Modi of being 'anti-farmer' and 'selling' the country through the India-US interim trade deal, vowing to stand strongly with farmers.
The United States announced a 25 per cent tariff on India as the White House released an expansive list of duties that Washington, DC will impose on exports from countries around the world.
Prime Minister Narendra Modi on Friday said India will never compromise the interests of its farmers, fishermen and dairy farmers, asserting that he would be ready to pay any price.
Prime Minister Narendra Modi stayed calm, avoided public confrontation, and focused on India's long-term interests to steady ties with the United States.
India's exports contracted 11.8 per cent to $34.38 billion in October, showed government data released on Monday. Imports jumped 16.63 per cent to $76.06 billion.
From the 30-Sensex firms, NTPC, ICICI Bank, Adani Ports, Bharti Airtel, Sun Pharma and Bajaj Finance were among the biggest laggards. However, Asian Paints, HCL Tech, Bharat Electronics and Reliance Industries were among the gainers.
While both sides have announced the decision to restart talks for a trade deal, government officials said discussions are continuing virtually.
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'Even if tariffs are reduced, non-tariff may still remain a challenge.'
The statement did not name any country. But the US has often blamed India and China for purchasing Russian oil even when there are no tariffs on Beijing for it.
Inflation data, trading activity of foreign investors and global trends would dictate sentiment in the stock market this week, according to analysts.
Congress leader Shashi Tharoor disputes Donald Trump's claims of using trade to stop the India-Pakistan military conflict in May, citing conversations with government officials.
US President Donald Trump has announced a 25 per cent plus tariff on India from Aug 1. Trump, describing India as a "friend", said the US has done relatively "little business" with the country because of its high tariffs.
The rupee appreciated 13 paise to close at 90.34 against the US dollar on Thursday, on trade deal optimism and overnight decline in commodity prices, even as the upside remained capped as investors look for more clarity on the India-US trade deal.
India's economy experienced a growth of 7.8 per cent during the October-December quarter of 2025-26, according to the new series of national accounts with 2022-23 as the base year.
The additional 25 per cent duty will come into effect after 21 days or August 27.
Lutnick said that these countries have to understand that if "you want to sell to the US consumers, you've got to play ball with the President of the United States."
United States President Donald Trump on Tuesday boasted about India-US defence cooperation, claiming that India's order for 68 Apache attack helicopters was delayed by five years and that Prime Minister Narendra Modi personally raised concerns over the long delivery period during a meeting with him.
Equity benchmark indices Sensex and Nifty advanced for the third straight session on Tuesday driven by firm global cues and optimism over India-US trade agreement, even as investors turned to profit-booking at higher levels.
On August 7, the US president announced doubling tariffs on Indian goods to 50 percent for India's purchases of Russian crude oil, but gave a 21-day window to negotiate an agreement.
Rahul Gandhi said that had an INDIA Bloc government negotiated the trade agreement with the US, it would have told US President Donald Trump that he should treat India as an equal.
MEA spokesperson Randhir Jaiswal said India's energy decisions are guided by national interest.
Trump administration's chief negotiator Brendan Lynch is arriving in India to hold talks on the India-US bilateral trade deal, which were impacted after the US imposed 50 per cent import tariffs on Indian goods.
High US tariffs are expected to affect close to 8 per cent of India's overall auto component production, ratings firm Icra said on Wednesday. Indian auto component exporters are at a relative disadvantage compared to most other Asian exporting nations, highlighting the importance of concluding an India-US bilateral trade agreement, it added.
'A deal will only be possible if India stops buying Russian oil -- but even then, New Delhi must not compromise its core red lines.'
India's exports grew 6.74 per cent to $36.38 billion in September, while imports jumped 16.6 per cent, widening the trade deficit to $31.15 billion, the highest in over a year. The increase in inbound shipments of gold, fertiliser and silver has pushed the country's imports in September to $68.53 billion against $58.74 billion in the same month last year, official data released on Wednesday showed.
Ambareesh Baliga's quick take on the markets after the increase in STT on futures and options trading...
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