Finance Minister Rejects 'Tariff King' Label, Emphasises India’s Streamlined Tariff Regime

New Delhi, Jun 25 (KNN) Finance Minister Nirmala Sitharaman on Tuesday firmly rejected the long-standing “tariff king” label often associated with India, asserting that the country’s tariff regime has become significantly more streamlined and export-oriented. 

She indicated that free trade agreements (FTAs) with the United States and the European Union are progressing well and may soon be finalised.

Speaking at the India EXIM Bank Trade Conclave, Sitharaman said the Union Budget for 2025–26 has rationalised the customs tariff structure for industrial goods by reducing the number of tariff rates from 14 to just 8, including a “zero rate.” 

This, she said, has led to a meaningful reduction in overall tariff levels.

Responding directly to past criticism—including repeated comments by former US President Donald Trump branding India as a “tariff king”—the minister clarified that India’s tariff-setting process is often misinterpreted. 

“We seek Parliamentary approval for a ceiling level of tariffs, but the effective rates are usually much lower,” she explained. However, what gets published is the bound rate, leading to a misleading global perception of India as overly protectionist.

“Our procedures have unfortunately contributed to an image that suggests we are regressive on tariffs, which is far from reality,” she said.

Highlighting the government’s focus on boosting exports, Sitharaman outlined five key initiatives: infrastructure and logistics improvements, targeted MSME support, greater access to trade finance, development of trade clusters, and expansion of India’s FTA network.

India has already inked FTAs with the UAE and Australia, and a trade agreement with the European Free Trade Association (EFTA) bloc is expected to come into force later this year. 

Negotiations with the United Kingdom have concluded, and discussions with the US and EU are in advanced stages.

“Talks with the US and EU are ongoing in full swing and are expected to reach a conclusion soon,” she said, adding that such agreements will empower Indian exporters and drive export-led growth.

(KNN Bureau)