India Rejects USTR Tariff Plan as Flawed, Urges Bilateral Talks

The Commerce Ministry asked the USTR to reconsider the tariff and instead address any trade concerns through the India-U.S. bilateral trade negotiation framework. India remains willing to engage through consultation and dialogue, Mishra added.

Shreyans Gupta, First Secretary at the Indian Embassy in Washington, D.C., spoke for the Agricultural and Processed Food Products Export Development Authority. He said the USTR's observations on rice imports were off base. India's rice imports are tiny – less than 3% of the value of its rice exports to the United States – and serve niche demand. Exports of imported rice are blocked by regulatory checks; only rice from mills registered with the agriculture ministry can be exported.

"For these reasons, the present investigation against India may be rescinded without prejudice," Gupta said. He asked for an exemption for Indian rice if the tariff proceeds.

Industry chambers Ficci and CII also submitted objections. Ficci said the tariff would raise costs for U.S. manufacturers, importers, retailers, and consumers, not just Indian exporters. Higher tariffs will increase costs for businesses that already follow compliance standards, the chamber said. CII argued that the USTR report does not establish that India's policy framework burdens U.S. commerce.

The proposed tariff carries real economic weight. India exported about $87 billion in goods to the United States in 2025, making the U.S. its largest trading partner. A 12.5% duty would hit sectors such as textiles, pharmaceuticals, engineering goods, and agricultural products. Indian rice exports, already under pressure from global oversupply, would face an additional hurdle if the exemption is not granted.

The USTR will consider the comments and testimonies before a final decision. No timeline has been set for the ruling.