Who gains, who loses? How India stacks up against rivals after US tariff cuts

India has gained trade advantage against its regional rivals like China, Pakistan and Bangladesh after US President Donald Trump dropped the effective tariff on Indian goods from 50% to 18%.

In a post on his Truth Social platform, Trump said New Delhi has agreed to end purchases of Russian oil and that Washington would reduce its tariffs on Indian goods.

The US President said that reciprocal tariffs on Indian imports into the US would be cut from 25% to 18%, effective immediately, while India would eliminate tariffs and non-tariff barriers on US products.

“At the request of Prime Minister Modi, effective immediately we agreed to a Trade Deal… This will help END THE WAR in Ukraine, which is taking place right now, with thousands of people dying each and every week!” Trump wrote.

Prime Minister Narendra Modi also confirmed the tariff reduction but didn’t mention anything on the trade deal or eliminating tariffs and non-tariff barriers on US products.

“Wonderful to speak with my dear friend President Trump today. Delighted that Made in India products will now have a reduced tariff of 18%. Big thanks to President Trump on behalf of the 1.4 billion people of India for this wonderful announcement,” Modi said on X.

How others fare

While India’s 18% tariff places it below several emerging Asian economies, it remains higher than rates enjoyed by some advanced economies and key US allies.

The European Union, Japan, South Korea and Switzerland face tariffs of 15%, while the UK enjoys the lowest rate at 10%.

Vietnam and Bangladesh are subject to 20% duties, putting them at a disadvantage relative to India.

India also gets an advantage over Pakistan, which faces a 19% tariff despite warming up to Trump and even nominating him for the Nobel Peace Prize.

China continues to face significantly higher tariffs at 34%, while Brazil tops the list with a steep 50% tariff.

Among Southeast Asian nations, Malaysia, Cambodia and Thailand attract tariffs of 19% each, marginally higher than India’s rate.