NEW DELHI: In response to pressure from the United States, the government has reduced the import duty on bourbon whiskey from 150% to 100% and has also lowered tariffs on various wines.
The duty on wines made from fresh grapes, vermouth, and other fermented drinks as well as unadulterated ethyl alcohol with an alcohol content of 80% has been set to 100%. Together, the import of these items totaled approximately $1 billion in the last fiscal year.
For bourbon, the basic customs duty is now established at 50%, with an additional agricultural cess of 50%. Last year, imports for the two categories related to bourbon were estimated at $2.6 million, with $0.8 million coming from the US.
The duty reductions were announced on Thursday, just hours prior to Prime Minister Narendra Modi’s meeting with US President Donald Trump, during which tariffs were a key topic of discussion. Trump reaffirmed his intention to implement what he described as reciprocal tariffs to support American industries. Before meeting Modi, he highlighted that India has some of the highest tariffs globally.
India’s tariffs on whiskey and other alcoholic beverages have raised concerns among various countries, including Australia, the UK, the European Union, Switzerland, and the US. Although India has reduced tariffs on Australian wine under a trade agreement, the UK has been pressing for lower levies on Scotch whisky as part of trade negotiations, while the EU has been advocating for cuts on wines produced within the bloc.
In the Budget presented on February 1, the government had already decreased import duties on a range of products, including premium motorcycles like the iconic Harley Davidson, in an effort to ease tariff pressures. However, this move has not prevented Trump from voicing concerns about duties in India, using Harley Davidson as an example during media interactions.
Tag: India
PM Narendra Modi with US President Donald Trump (File Image)
Photo: PTI
New Delhi: In preparation for Prime Minister Narendra Modi‘s upcoming talks with US President Donald Trump during his visit to the US, India is reportedly considering further duty reductions to promote American exports, according to Reuters, which cited government sources. Additionally, New Delhi might reference recent tax reductions on American imports as a strategy to bypass tariffs.
PM Modi is scheduled to visit the United States on February 12-13 to meet with President Trump. Before this meeting, India is contemplating tariff adjustments, although there has been no official confirmation as of yet.
In the coming days, it is anticipated that India may implement custom duty reductions across a variety of sectors, including electronics, surgical and medical equipment, and certain chemicals, as reported by Reuters.
These adjustments are aimed at items for which India often relies on US imports and could feasibly acquire more from the United States, such as dish antennas and wood pulp.
Moreover, it has been suggested that India might leverage recent duty cuts to evade Trump tariffs, as indicated in a report by the Times of India. Trump’s economic adviser, Kevin Hassett, pointed out India’s high tariffs, which hinder imports, and noted that Prime Minister Modi had significant discussions planned with President Trump during their upcoming meeting.
India Reduces Custom Duty on American Goods
In the latest Union Budget, India announced reductions in customs duties for motorcycles, including those made by Harley Davidson, as well as on synthetic flavoring essences. This duty reduction is expected to favor American exporters directly.
The tariff on motorcycles with engine sizes below 1,600cc has been decreased from 50% to 40%, while for those exceeding 1,600cc, it has been lowered from 50% to 30%.
India has cut the duty on fish hydrolysate used for aquatic feed production from 15% to 5%, a change that significantly affects US exports, valued at $35 million in 2023-24.
Additionally, the customs duty on synthetic flavoring essences has been reduced from 100% to 20%, corresponding to US exports worth $21 million in FY24.
The Global Trade Research Initiative (GTRI) remarked that despite the Trump administration’s frequent criticisms labeling India as the biggest tariff offender, the recent Budget has introduced notable tariff cuts across various products that benefit US exports.
“With major tariff reductions on technology, vehicles, industrial inputs, and waste imports, India seems to be making efforts to facilitate trade even amidst a strained global trading environment. It remains to be seen if these reductions will influence Washington’s perspective on India’s trade policies or become a contentious issue in the US election cycle,” the GTRI noted.
NEW DELHI: In its Union Budget for 2025-26, India has substantially reduced customs duties on premium motorcycles, cars, and smartphone components. This development appears advantageous for American companies such as Harley-Davidson, Tesla, and Apple, following remarks by US President Donald Trump describing New Delhi as a “tremendous tariff maker.”
Nonetheless, Finance Minister Nirmala Sitharaman stated that the adjustment of customs duties is aimed at promoting self-reliance within the Indian economy and is not a reaction to Trump’s tariff announcements.
“We are focusing on our own economy and aiming to fortify the foundations of the Indian economy to transform it into a manufacturing hub,” she asserted.
During her budget presentation on Saturday, Ms. Sitharaman disclosed a reduction in import duties for high-end motorcycles, with engine capacities up to 1,600cc imported as completely built-up (CBU) units, from 50 per cent to 40 per cent.
According to the Union Budget for 2025-26, the import duty on semi-knocked down (SKD) kits has decreased to 20 per cent from 25 per cent. Furthermore, completely knocked down (CKD) units will now incur a tax of 10 per cent, down from 15 per cent.
This shift is set to enhance the import of quintessentially American Harley-Davidson motorcycles into India, as the previous high tariffs have been a longstanding issue between India and the US.
Harley-Davidson began its journey in India in 2010, following the “mangoes for motorcycles” agreement established between India and the US in 2007. However, the American motorcycle manufacturer withdrew from the Indian market about ten years later, in September 2020, as part of broader downsizing efforts.
Nonetheless, a month later, Harley-Davidson re-entered the Indian market after Hero MotoCorp Ltd formed a non-equity partnership with the American brand to manufacture and distribute its motorcycles in India. Currently, Hero MotoCorp produces and sells the Harley-Davidson 440X, the smallest model in the brand’s lineup.
During his first term in office, Trump raised concerns regarding the 50 per cent import duty on Harley Davidson motorcycles, deeming it “unacceptable.”
Separately, Ms. Sitharaman announced that the tariff on luxury cars, including station wagons and racecars valued over $40,000, has been reduced from 125 per cent to 70 per cent. Additionally, the basic customs duties on lithium-ion batteries used in electric vehicles in India have been eliminated.
Most of the aforementioned EV manufacturers are already operational in India, developing vehicles tailored for the Indian market. However, this move could serve as a lure for American companies like Tesla, which is keenly observing the expanding Indian EV landscape.
In April 2024, Tesla CEO Elon Musk planned a visit to India to meet PM Modi, fueling speculation about potential investments in the country. However, he canceled the trip due to “very heavy Tesla obligations.”
In the 2025-26 budget, Ms. Sitharaman confirmed that customs duties on 28 items related to mobile phone battery production from countries such as the US and China have been waived. This initiative aims to lower the cost of mobile phones and accessories in India while bolstering local production, particularly as India progresses towards becoming the world’s second-largest mobile phone manufacturer.
Apple stands to gain significantly from these reductions in import taxes. A report from Reuters indicates that Apple secured a 23 per cent share of total revenue in 2024.
As US President Trump advocates for prioritizing domestic industry under his “America First” trade policy, India’s recent adjustments to import taxes are perceived as a strong signal to the American administration, seeking assurance against increased taxes or additional trade barriers directed at Indian goods.
Previously, Trump asserted that India imposes the highest tariffs on foreign items compared to major economies and threatened to enforce reciprocal tariffs on Indian products. He also warned of 100% tariffs on BRICS nations, including India, if they moved away from the US dollar.
Speculation arises that with the tax reductions on imports, India aims to capitalize on the US-China trade conflict and augment its own presence in global supply chains. Trump’s tariffs are becoming disruptive to global trade, creating uncertainty in the market. With the import tax reductions, India should be better positioned to navigate a potentially unpredictable year, as reported by Reuters.
Exciting news for motorcycle enthusiasts!
In a strategic move benefiting the iconic American brand Harley-Davidson, India has announced a reduction in import duties on premium motorcycles.
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This change is set to make Harley-Davidson motorcycles more attainable for riders throughout the country.
The longstanding tariff on Harley-Davidson has been a contentious issue between India and the United States.
So, what prompted India to lower the import duties on these bikes now? What effects will this have on sales and the market?
Let’s dive in:
Reasons for the Reduced Prices of Harley-Davidson in India
The import duty on motorcycles with engine sizes up to 1,600 cc, brought in as completely built-up (CBU) units, has decreased from 50% to 40%.
For larger motorcycles exceeding 1,600 cc, the reductions are even more significant.
The tariff on semi-knocked down (SKD) kits has been reduced from 25% to 20%, while completely knocked down (CKD) units will now incur a tax of 10% instead of 15%.
This tariff issue has been a long-standing point of contention between India and the United States, with former US President Donald Trump repeatedly advocating for its reduction. The announcements made in the Budget 2025 have helped alleviate these tensions.
With these duty reductions, Harley-Davidson motorcycles are expected to become more affordable, potentially expanding their customer base and boosting sales and market share for the brand.
While the basic customs duty on cars and other vehicles has also been lowered, its effect on effective duty rates remains unclear.
In the Union Budget for 2025-26, the government has introduced an Agriculture Infrastructure and Development Cess (AIDC) on the imports of such two-wheelers, whether as CBU, SKD, or CKD units.
The tax rationalization aims to lower prices compared to prior rates.
This initiative is perceived as an attempt by the Indian government to create a fair competitive environment for international manufacturers by decreasing tariff barriers in sectors where India has a robust supply chain, as stated by Saurabh Agarwal, Partner & Automotive Tax Leader at EY, in an interview with The Hindu BusinessLine.
The Trump Influence: ‘America First’ Trade Policy
This decision is interpreted as a significant signal to the new US administration under Trump. The previous US President’s administration consistently advocated for the reduction of trade barriers, especially concerning products made in the United States.
Prior to this, Trump highlighted that India imposed the highest tariffs on foreign products among major economies and even threatened to apply reciprocal tariffs on Indian goods.
“One of the most critical elements of my plan to revitalize the American economy is reciprocity. It’s vital because we usually don’t impose tariffs. I initiated that process with vehicles like vans and small trucks, etc. While we don’t impose high tariffs, China has a 200 percent tariff, and Brazil imposes significant charges. India ranks as one of the highest,” Trump stated in a notable economic policy address.
In an interview with CBS News, Trump expressed, “We are not the naïve country that suffers as poorly. India is a close friend of mine, Prime Minister (Narendra) Modi, has implemented a 100 percent tax on motorcycles. We don’t charge them a penny.”
“Thus, when Harley exports there, they face a 100 percent duty. Conversely, when they import into India, there are no taxes. I informed him it is unacceptable,” he added.
VIDEO | Reiterating his stance on tariffs, US President Donald Trump (@realDonaldTrump) spoke in Miami, stating, “Outside forces that genuinely wish us harm, but wish to improve their own country, look at others such as China which imposes tremendous tariffs. pic.twitter.com/NDW8v1WYUG
— Press Trust of India (@PTI_News) January 28, 2025
“Through one phone call, he (Modi) reduced it by 50 percent. Yet, I still find it unacceptable because 50 percent against nothing still poses an issue. They are currently addressing this,” he further mentioned.
In December of the previous year, Trump clarified that his administration would adopt a tit-for-tat stance, saying, “If they impose taxes on us, we will impose the same on them.”
“Reciprocity is crucial, as it raises the question: If India levies a 100 percent tax, why shouldn’t we charge them proportionately? They send us bicycles, and we send them bicycles. They impose significant duties, while we do not,” he said.
Trump’s view aligns with his “America First” trade policy, focusing on safeguarding American workers and families. In his inauguration speech, he proclaimed that his policies would reinstate the US as a manufacturing power.
It’s important to note that Trump has also hinted at the possibility of imposing 100% tariffs on BRICS countries, including India, should they attempt to steer away from utilizing the US dollar. The BRICS group comprises ten nations: Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the UAE.
External Affairs Minister S Jaishankar clarified in December that India has never favored de-dollarisation and that no proposals exist for a BRICS currency.
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Other Possible Customs Duty Reductions in India
India’s strategic focus is on fostering domestic manufacturing.
As reported by News18, the government is contemplating customs duty cuts on approximately seven to eight premium products, including specialized steel, high-end motorcycles, and electronic devices.
The duty on luxury vehicles priced over $40,000 has been decreased from 125% to 70%, including models like station wagons and racecars, as reported by NDTV Profit.
At present, the Harley-Davidson 440X—the smallest model in their line— is being co-manufactured and sold in India by Hero MotoCorp. The company has recorded sales of 12,188 units of both the Harley-Davidson X440 and the X440-based Hero Mavrick 440 from April to December 2024.
With contributions from various agencies
In a promising move for the new US administration under President Donald Trump, India has reduced the import duty on high-capacity motorcycles in the Union Budget 2025-26, providing a significant advantage for the American brand Harley-Davidson.
Motorcycles with an engine capacity of up to 1,600 cc, imported as completely built-up (CBU) units, will now incur a 40% import duty, down from the previous 50%, as outlined in the Budget documentation.
The import duty on semi-knocked down (SKD) kits has been lowered to 20%, from 25% previously.
For completely knocked down (CKD) units, the tax rate will be set at 10%, reduced from 15% earlier.
The government’s objective is to encourage domestic manufacturing.
Reports also indicate that India is considering a reduction in customs duty on approximately seven to eight high-end products, including specialized steel, luxury motorcycles, and electronic goods.
Currently, the Harley-Davidson 440X – the smallest model in the brand’s lineup – is co-manufactured and sold in India by Hero MotoCorp.
Additionally, the Budget specified that high-end cars priced over $40,000 will now face a tariff of 70%, down from 125%, reflecting the increasing demand for luxury vehicles in the country.
Hero MotoCorp, which produces the Harley-Davidson X440 and the X440-based Hero Mavrick 440, reported sales of 12,188 units for these two models during the April-December 2024 timeframe.
This marks a year-on-year growth of 77%, giving Hero MotoCorp a 13% share of this market segment.
The Made-in-India Harley-Davidson is manufactured at Hero’s Garden Factory in Neemrana, Rajasthan.
It is available in three variants – Denim (₹2.40 lakh), Vivid (₹2.60 lakh), and S (₹2.80 lakh) – with 8,974 units sold between April and December 2024, representing a 31% increase according to industry data.
(This content was sourced from a syndicated feed and only edited for style by the Gujarat Samachar Digital team)
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Following Trump’s election victory last November, India initiated a comprehensive sector-wise assessment, devising multiple scenarios to brace for potential tariff hikes on exports to the US under Trump’s administration, as reported by ET in December.
India’s prospects under the Trump administration
Trump’s memorandum titled “America First Trade Policy,” released on his first day in office, could present an opportunity for India. The memo instructed the United States Trade Representative (USTR) to pinpoint countries to engage in trade agreements, either bilaterally or within specific sectors, to enhance export access for various American entities. The Indian government is currently reviewing the memo. “We are analyzing the memo and assessing its implications before creating any strategy… At this stage, based on an initial reading, I don’t see anything overly concerning. Our evaluations have yet to materialize into action,” officials informed PTI. The government is also waiting for the official confirmation of the key trade positions in the US.
Indian and US diplomats aim to organize a meeting between Prime Minister Narendra Modi and Trump in Washington in February, according to sources who spoke to Reuters. However, the likelihood of a February meeting remains uncertain. There is a possibility for a bilateral discussion later in the year, especially when the Quad leaders—comprising India, Australia, Japan, and the US—reconvene at an annual summit hosted by India.
Indian officials are contemplating a limited trade agreement with the US within one scenario, according to Bloomberg sources. The proposed plan would involve lowering certain “most-favored nation” tariffs imposed on countries with which India lacks a bilateral trade deal.
Last month, Reuters reported that India is gearing up to propose tariff reductions on certain agricultural and other goods primarily imported from the US, aiming for a more extensive trade and investment deal once Trump assumes office. To address Trump’s proposal of a “reciprocal tax” on Indian goods due to high tariffs, some officials from the Indian commerce ministry are contemplating reductions on specific items like pork, as revealed by a senior government source. Currently, India enforces a 45% import tariff on pork, predominantly sourced from the US. Additionally, tariffs could see reductions on premium medical devices such as pacemakers and luxury motorcycles like Harley Davidson, according to an official with direct knowledge of trade matters, who cited existing tariffs ranging from 25% to 60% on those products. To alleviate Trump’s concerns regarding the trade deficit, officials have also suggested increasing purchases of LNG and defense equipment from the US, as reported by Reuters.
“This presents an opportunity,” noted Arvind Virmani, a government advisor and member of the state-run policy think tank NITI Aayog, speaking to Reuters. “Both the US and India would benefit from shifting more critical and sensitive manufacturing to India rather than relying on China,” he added, suggesting a more ambitious “preferential trade cum investment deal” than the previously discussed mini-trade agreement, which could be mutually beneficial for both nations.
Restarting India-US discussions from a prior standpoint
During Trump’s initial term, a proposed mini-trade agreement aimed at addressing trade discrepancies and enhancing trade relations through limited deals stalled due to disagreements over tariffs, access to markets, and intellectual property. The Biden administration similarly is not keen on a free trade agreement. India now seeks a broader agreement, as reported by Reuters, offering substantial concessions such as production-linked incentives for logistics companies and support for logistics sector.
Kenneth I. Juster, a distinguished fellow at the Council on Foreign Relations, and Mark Linscott, a senior advisor at the U.S.-India Strategic Partnership Forum and the Asia Group, expressed in ‘Foreign Policy’ that this time around, Modi and Trump should take advantage of the opportunity to forge a significant bilateral agreement.
They noted that although US-India economic relations have consistently advanced throughout the 21st century, they have not met expectations in comparison to the remarkable progress made in nearly every other aspect of the bilateral partnership. “However, there are grounds for optimism. Trump enjoys negotiating deals and is eager to enhance the US economy. His tariffs may serve as leverage to unlock foreign markets for US companies, creating jobs related to exports and reducing the bilateral trade deficit. Modi is a strategic thinker focused on fostering India’s economy and expanding its international role,” they stated.
“Both the United States and India aim to strengthen their economic influence in the Indo-Pacific region and mitigate China’s economic dominance. The moment is opportune, and the incentives exist for both leaders to overcome challenges and finalize a major agreement.”
(With contributions from agencies)
Posted by livingdocustyle on 2018-05-25 17:40:15
Tagged: , karen davidson , Harley Davidson , Harley Davidson India , India , kolkata , harley , west bengal , launch event , store launch , riding , rider , automotive photography , automotive , event photography
President-elect Trump stated on Tuesday that the US would introduce reciprocal tariffs on Indian products due to the high tariffs imposed by New Delhi on American goods. Experts suggest that India might need to reassess its import duties on specific items and could offer increased market access for certain American imports to alleviate Trump’s concerns.
Previously, the US has raised concerns regarding the high import duties on Harley Davidson motorcycles, as well as limited access for medical devices, equipment, and dairy products in India.
Addressing US Concerns
Officials assert that India’s most favoured nation (MFN)-weighted average import tariff is relatively low, approximately 5-6%. While select agricultural products encounter higher tariffs, even those are significantly lower than the rates outlined by the World Trade Organization (WTO). They note that most countries, including the US, apply elevated tariffs and various non-tariff barriers on agricultural goods. For instance, dairy products, fruits and vegetables, cereals, food preparations, and oils in the US face tariffs as steep as 130-190%.
One insider mentioned that any thorough evaluation of the impact or necessary measures can only occur after the Trump administration officially takes over on January 20.
Experts suggest that New Delhi has the option to impose retaliatory tariffs or approach the WTO while advocating for a strategic response.
“It makes sense to reconsider certain products for tariff adjustments to address US concerns,” remarked one expert who preferred to remain anonymous due to the sensitive nature of the issue. While tariffs are bound by WTO commitments or linked to MFN status rather than being country-specific, there is an opinion that a measured approach could be taken when evaluating the product list traded between India and the US.
“It is unfeasible for India to implement country-specific tariffs, as that would violate the most-favoured nation (MFN) principle,” stated Ajay Sahai, director general of the Federation of Indian Export Organisations (FIEO).
Tariff Review
Sahai believes that India can revisit certain tariff lines and strategize accordingly, even if it results in a slight duty loss on some products.
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Harley Davidson x440
At ZigWheels, we had the exciting opportunity to take part in the Harley-Davidson X440 Flat Track Race during India Bike Week (IBW) 2024. This race served as our first real experience with flat track racing and also proved to be quite an eye-opening experience.
Getting Started
A few weeks ago, I attended the TVS Ronin Drift-R school, where I learned fundamental skills for riding on the flat track. This enlightening experience significantly enhanced my road riding abilities.
Landing the chance to participate in the Harley-Davidson X440 Flat Track Race at IBW 2024 thrilled me. It was an opportunity to apply what I had learned previously, and as someone who had never raced before, I was eager to see how I’d perform.
The Motorcycle and the Circuit
For this event, we rode the uniquely modified Harley-Davidson X440. This bike featured numerous alterations in both its design and mechanics. The headlight was removed, replaced with a racing number plate.
The standard seat and subframe were swapped out for foam padding and a sleeker rear end. Additionally, several mechanical modifications were made; for instance, the front brake was taken off and the original footpegs were replaced with ones suitable for off-roading.
One feature I particularly appreciated about this build was its resemblance to the Harley-Davidson XR750. Overall, the modifications were executed exceptionally well, making the bike feel like an authentic flat tracker.
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The race track was a 160m oval, considerably shorter than the 250m circuit I had previously experienced. This smaller size posed unique challenges, particularly due to the reduced straightaway lengths.
The intensity of the race increased as we approached the corners at a much faster pace. The bike was well-equipped to handle the conditions, but I couldn’t help wondering if I was truly prepared for this challenge.
The Race and Lessons Learned
The flat track race was quite different from my expectations. Instead of having all eight journalists racing simultaneously, we were divided into four pairs. This structure meant that the race became a series of one-on-one match-ups, with the winners progressing to the next round. This format allowed me more space to maneuver on the track.
One principle I adhere to is that “competence breeds confidence.” Before the race, I felt quite self-assured. However, once the competition began, it quickly became evident that my confidence was not supported by the necessary skills.
Getting eliminated in the first round made it clear where I truly stood in terms of my abilities. I managed to get a couple of things right, but there were also many mistakes.
During my prior track experiences, I focused on three critical areas: vision, body positioning, and throttle control. However, I overlooked the importance of choosing racing lines, which was a significant factor in my performance.
When riding on roads, we think about lines for safety against oncoming traffic. In contrast, in racing, the objective is to find the optimal path to maximize speed and minimize lap times.
I attempted to approach the corners from a middle line into an inside line, exiting toward the outside. This habit stems from road riding, where it allows a better view of oncoming traffic.
However, during racing, the dynamics are entirely different. On the flat track, where double apex turns are involved, choosing the right lines is crucial. Ideally, I should have approached wide, taking the first apex closer to the center of the track and the second on the inside.
Insights Gained from Racing
One of the most significant lessons I learned from participating in the Harley-Davidson Flat Track Race is that there’s always more beneath the surface. This is especially true in flat track racing.
To the casual observer, it may appear to be a simple race around an oval track, but once you find yourself on the bike, your perspective shifts dramatically. The insights gained from this experience have highlighted areas of my skills that require improvement.
If you’ve been contemplating trying flat track racing, my advice is straightforward: just do it. The experience will significantly enhance your road riding abilities.