India unlikely to get U.S. exemption on steel, aluminium tariffs-sources

By Neha Arora, Shivangi Acharya and David Lawder

NEW DELHI/WASHINGTON (Reuters) -India has asked the United States for an exemption from U.S. steel and aluminium tariffs, in exchange for removing some tariffs on U.S. agricultural goods but Washington is not seriously considering the offer, sources familiar with the discussions said.

Negotiators in New Delhi and Washington have been in talks, hoping to reach an agreement during Indian Prime Minister Narendra Modi’s visit to the United States later this month, with Indian officials offering to withdraw retaliatory tariffs on some agricultural goods such as almonds and walnuts, two Indian sources said.

“India has raised the issue but they’ve been turned down fairly quickly by the U.S. team, so it isn’t in serious consideration right now,” a U.S. source familiar with the talks told Reuters.

“U.S. officials have been very clear with India in meetings that they are not considering an exemption for India on Section 232 tariffs,” the source added, declining to be identified.

An Indian government source said U.S. negotiators were not “flexible”, even though there were expectations of reaching some form of an agreement during Modi’s visit.

“PM (Modi) is visiting and by that time, they (U.S.) want to come up with something good, which looks positive for both sides,” the source said.

India is also willing to discuss other possible trade measures that the U.S. officials may propose, the second Indian government source said.

India’s trade ministry did not reply to email seeking comment. The Office of the U.S. Trade Representative and the U.S. Department of Commerce, which administers the Section 232 tariffs, both declined comment on the matter.

The Indian officials did not want to be named as they were not authorised to speak to media.

In 2018 then U.S. President Donald Trump imposed a 25% tariff on all U.S. steel imports and 10% on aluminium, using Section 232 of a 1962 act that allows the president to restrict imports.

In retaliation, India imposed tariffs on 28 U.S. products, including almonds, apples, and walnuts.

Last December, The World Trade Organization ruled that U.S. tariffs imposed on steel and aluminium imports by Trump contravened global trading rules, a judgment criticised by Washington.

On Wednesday, at a U.S. Congressional Steel Caucus hearing, several steel industry leaders expressed support for keeping the tariffs in place.

Kevin Dempsey, president of the industry trade group American Iron and Steel Institute, told Reuters he did not think the U.S. government would agree to withdrawing the tariffs.

(Reporting by Neha Arora, Shivangi Acharya in New Delhi and David Lawder in Washington; Editing by Susan Fenton)