India is preparing to impose higher tariffs on some US goods including almonds, walnuts and apples next week after a delay of about a year, two sources said, following Washington’s withdrawal of key trade privileges for New Delhi.
From June 5, President Donald Trump scrapped trade privileges under the Generalized 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.
India is now looking at adopting the higher tariffs, the sources with direct knowledge of the matter said, although the US has warned that any retaliatory tariffs by India would not be “appropriate” under WTO rules.
“What India is doing is legal and the tariffs on US goods will only lead to an impact of around $220 million,” one of the sources said, declining to be identified because of the sensitivity of the matter.
India’s Ministry of Commerce and Industry did not respond to an email from Reuters to seek comments.
India initially issued an order in June last year to raise import taxes as high as 120 percent on a slew of US items, incensed by Washington’s refusal to exempt New Delhi from higher steel and aluminium tariffs.
But New Delhi repeatedly delayed raising tariffs as the two nations engaged in trade talks. Trade between them stood at about $142.1 billion in 2018.
India is by far the largest buyer of US almonds, paying $543 million for more than half of US almond exports in 2018, US Department of Agriculture data shows. It is the second largest buyer of US apples, taking $156 million worth in 2018.