On March 4, 2025, US President Donald Trump revealed a plan to initiate reciprocal tariffs effective April 2, against countries like Brazil, India, and China, on grounds of enforcing unfair trade policies. These efforts have fueled the global fears about impending trade wars and their possible effect on growth in the economies.

In spite of all these advances, India still hopes to defuse trade tensions through continuous negotiation. Commerce Minister Piyush Goyal has just arrived for a weeklong trip to the United States with a view to negotiating mutual problems such as tariffs and non-tariff issues. Both countries are aiming at sealing the first part of a bilateral trade pact by autumn of 2025.

One of the central issues of these talks is the auto industry. The United States is pushing for lowered or eliminated tariffs on automobile imports to allow entry for American firms such as Tesla into the Indian market. India, which imposes high auto import duties of up to 110%, is mulling phased cuts while in talks with local auto makers to balance local industry concerns.

The result of these talks has far-reaching consequences for both economies, affecting industries like manufacturing, technology, and agriculture. The entire world is watching closely as to how this goes, thanks to the promise of reshaping global trade dynamics.