Page 10 - The Indian EYE 021326

OPINION FEBRUARY 13, 2026 | The Indian Eye 10

US–India Tariff Reset at 18%:

Trade, Trust, and the New Grammar

of Global Power

gates between India and the United consequential: a recalibration of currency stress, and deep anxiety
States over recent months played an economic trust between the world’s among millions of workers and small
important role in building the trust two largest democracies at a moment businesses tied to global trade. By
and momentum necessary for this when global trade, geopolitics, and late 2025, it had become clear that
agreement. Both leaders, he added, energy security are being fundamen- prolonged escalation would produce
are looking forward to visiting each tally rewritten. no winners—only economic damage
other’s countries in the near future In an era marked by war in Eu- on both sides. The decision to reset
— a signal of the continuing commit- rope, fragmentation of supply chains, tariffs to 18 percent therefore rep-
ment to deepen bilateral engagement rising protectionism, and deepen- resents a deliberate shift away from
at the highest level. ing mistrust between major powers, confrontation and toward engage-
Special recognition is also due to ment. It signals an acknowledgment
key Indian leadership and diplomatic “This agreement is not just that economic interdependence between
H. S. PANASER architects of this breakthrough. Dr. the United States and India is too deep,
S. Jaishankar, External Affairs Min- about tariffs—it is about trust, and too strategically important, to be
he recent announcement by ister of India, has been instrumental alignment, and the evolving held hostage to short-term trade dis-
the United States to reduce in articulating India’s economic pri- putes.
Ttariffs on Indian goods to 18% orities and navigating complex geo- architecture of global trade Trade as a Mirror of Geopolitics
marks a significant and welcome de- political headwinds with nuance and among democracies.” Yet this agreement cannot be
velopment in global trade, economic steadiness. Equally vital has been the separated from the larger geopo-
stability, and bilateral relations be- contribution of Mr. Piyush Goyal, litical landscape. The world today
tween the world’s two largest democ- Minister of Commerce and Industry, trade agreements no longer operate is not divided merely between mar-
racies. At a time when global supply whose sustained engagement with in isolation. They have become in- kets and manufacturers, but between
chains remain fragile, geopolitical US counterparts and private sector struments of diplomacy, levers of competing visions of global order.
tensions persist, and economic na- stakeholders helped align commer- geopolitical alignment, and signals Energy security, defense alliances,
tionalism is on the rise, this decision cial interests with broader strategic of long-term intent. The US–India technology control, and supply-chain
signals pragmatism, dialogue, and objectives — making the ground for tariff reset must therefore be under- resilience have become inseparable
strategic maturity. agreement far more fertile. stood not simply as a commercial from trade policy. At the heart of the
This moment deserves recogni- On the diplomatic front, the tire- concession, but as a strategic decision US–India agreement lies a strategic
tion and appreciation for the lead- less efforts of India’s Ambassador shaped by global realities and shared understanding that goes beyond tar-
ership of both nations, and for the to the United States, Vinay Mohan democratic interests. For global busi- iffs. The reduction is closely linked to
tireless work of institutions and dip- Kwatra, and his team in Washington, nesses, investors, and policymakers, India’s commitment to recalibrate its
lomats who made this possible. DC, were foundational in maintain- this move brings relief, predictability, energy sourcing, particularly its re-
In a live televised discussion on ing dialogue and advancing consen- and renewed opportunity. For India liance on discounted Russian crude
NDTV that coincided with the an- sus in difficult moments. And at a and the United States, it restores oil that expanded significantly after
nouncement, US Ambassador to In- critical strategic nexus in the United momentum to a relationship that has 2022. For Washington, targeting Rus-
dia Sergio Gor — who has been at the States, Consul General Ambassador grown indispensable—economically, sian oil revenues is viewed as a critical
forefront of diplomatic engagement B Pradhan in New York, working strategically, and morally—over the pressure point in efforts to influence
and trade dialogue — emphasized closely with his team, has been mak- last two decades. the trajectory of the Ukraine conflict.
the depth of the personal rapport ing impactful contributions under From Escalation to Engagement For India, the challenge has been
between Prime Minister Narendra the radar of public attention — a re- The months leading up to this to balance ethical, diplomatic, and
Modi and President Donald Trump minder that cities like New York are announcement were marked by economic considerations while safe-
that helped bring this understanding vital hubs not just for commerce but tension and uncertainty. Successive guarding domestic energy security.
to fruition. Ambassador Gor high- for shaping the lived texture of in- rounds of tariff escalation—culmi- The agreement reflects a care-
lighted that the 30-minute conversa- ter-country relations. nating in duties of up to 50 percent fully negotiated compromise. India
tion between the two leaders earlier Appreciating Leadership and on key Indian exports—threatened agrees to pivot away from Russian oil
underscored not only progress on Institutions on Both Sides to disrupt supply chains, undermine and increase imports of US energy,
trade but the warmth and mutual This breakthrough reflects sus- competitiveness, and erode trust. technology, and agricultural prod-
respect that define the relationship tained engagement and coordination Sectors such as textiles, pharmaceu- ucts. In return, the United States re-
between the two nations’ leadership, across governments and institutions. ticals, engineering goods, and gems stores market access and economic
describing their ties as “real” and The announcement that the and jewelry faced the prospect of stability for Indian exporters. This is
grounded in shared strategic purpose United States will reduce tariffs on losing access to their most important not coercion, nor is it capitulation. It
and democratic values. He further Indian goods to 18 percent may ap- export market. is a recognition that in today’s world,
noted that the large number of visits pear, at first glance, as a technical These pressures were not ab- strategic alignment often takes the
and exchanges by elected represen- adjustment in trade policy. In reali- stract. They translated into falling form of economic choices.
tatives, business leaders, and dele- ty, it represents something far more export orders, market volatility, Continued on next page... >>

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