Agreed the snapback clause regarding Russian crude weaponises trade which is dangerous trend going all around the world .
India intends to purchase vs your article stating commits is miles apart. India's digital service tax removal also taken back by white house.
Bangladesh zero tarrif hinges on using US yarn which is more expensive as raw material .
Indias 42% exports are tarrif exempt ( generics etc )while 58% has 18 bringing weighted avg tarrif to 10.4% approx which is quite less scary than 18% headline
All in all my humble view was that it's not as lopsided as being portrayed in the article. But to each his own view. Love your all other articles always. Cheers
Hey Shrey, as mentioned earlier, we've indeed highlighted the tariff reduction on generics and many other items. Bangladesh's deal on using US yarn also proves our point about how the USMCA was designed to enforce that.
Perhaps, calling the 500B figure a "commitment" was too strongly worded. But this is from the official joint US-India statement. It is worth analyzing both what's in there and what's not, and what it means overall.
I enjoy the level of research done by your team but it seems like the team missed a trick here.
1. Indian commerce minister has said on record india has not committed to buy anything
2. India has protected it's dairy and agri sector except industrial agri raw materials
3. India has not committed to buying US energy and the discount on Russian oil has been decreasing due to sanctions
4. India went from 2.4% to 18 is not very smart statement because that was pre trump as all countries EU , uk , South Korea Japan all have had their pre trump tarrifs increased and have settled around 15-20% as the new normal
1. Do check out the statement from the White House. A trade deal isn't, per se, *binding* because there is no central authority (not even the WTO) to reinforce them if something goes wrong. However, there is indeed a $500B figure that India intends to purchase from the US which the official White House statement contains. But there is no such figure from the other side. It's about analyzing the power dynamic, which the statement clearly shows.
2. We haven't really mentioned agriculture as a sore point of contention in the entire piece, either.
3. Coking coal and *energy products* are explicitly part of the 500B figure. Moreover, in the same vein as 1), the commitment may not be binding - we are still very free to purchase Russian oil. But there are now active harmful consequences to this.
4. This is precisely why we do mention in the piece that it is indeed rational for India to pursue a deal with the US to gain an advantage over peers. We also admit that, perhaps, this might have been the best deal we could possibly get. But it is also clear that if India can, everyone else will - Bangladesh has followed suit not long after our deal, and their terms on textiles are probably better than ours. This will be a race to the bottom among all countries to get favorable terms with the US, and the idea that this new normal of exorbitant tariffs should be accepted is not a healthy premise. The problem starts with the premise itself.
>>But there are now active harmful consequences to this.
Yeah, like what?? India would abandon Russia. Is Russian crude even paying the same dividend as it did when it was $4-6 cheaper than the crude at a market level? If one looks at the data, then there's not much difference between the Brent crude and Ural crude now. Didn't India stop Iranian oil when the yanks told Delhi? Didn't they do the same with VZ crude?? Therefore, this is not the first time that this has happened.
Wow! Pranav so nicely put down the points against a seemingly andh bhakt's bias to show a bad deal as a good one! 🙏.. my respect for your team's work has gone up. Thank you.
The Kiel Institute report you quote is not entirely correct. “As the Kiel Institute’s research shows, the 18% tariff functions as a consumption tax on Americans. But the Trump administration appears willing to accept that trade-off for now. The logic, whether it works or not, is to protect American supply chains, even if it means Americans pay more.” Several US studies show that the passthrough of import tariffs has a marginal effect on the CPI which is what matters to US households, certainly not of the double-digit order of magnitude, as the Kiel study seems to imply. .
See this study and also several related studies, both from the Fed and other institutions:
“We then apply our methodology in real time, showing that tariffs implemented on China in February and March of 2025 have already affected consumer prices. So far, the effect of these tariffs has been a 0.33 percentage point increase in core goods PCE prices, contributing to a 0.08 percentage point increase in core PCE prices. As more or higher tariffs are imposed, we think our methodology will continue to be useful in assessing tariff effects on consumer prices.
We caution that our analysis pertains only to the consumer price effects of tariffs that the US has imposed on other countries. Our methodology is silent about the effects of retaliatory tariffs. It is also silent about any potential tariff effects on other outcomes, such as productivity and employment.”
Thank you for a very nice perspective backed up with sources and data as usual giving food for thought. I think 2.4% to 18% or 50% to 18% is subject to individual vantage point…
Wonder if the title of the article could have been a bit different…
Hi Ashish, thanks for your comment! It is, perhaps, subject to an individual vantage point. But it's worth noting that not long ago, we did have a 2.4% rate. The power dynamic has shifted too quickly in favor of the other party.
Not long ago, when?? Why are you still equating the world pre-Liberation Day, man?? Power dynamics were always with the yanks. Anyone, even his underpants won't be oblivious to that reality.
Great read! Regarding the section on the need for a corporate bond repo facility, I wanted to highlight that AMC Repo Clearing Limited (ARCL) is currently active in this space and is already conducting significant repo transactions in the corporate bond market.
I saw the recent daily brief of Zerodha on YouTube today, and man, it was such a partisan analysis. They even used that ChatGPT-generated table from that fraud Chellaney's tweet. And adding that the former CPI (M) Neta and SFI activist, now turned Congress party wannabe leftist economist, the Hindu opinion piece tells how partisan this analysis has been. That opinion piece is nothing but another gaslighting piece of crap.
Firstly, having been protectionist for decades, India needs to open up its economy for imports to build a domestic economy and self-reliance in all major sectors. Private sector investment is low, and we need foreign investment for a growing economy, including into new fast-growing sectors like AI… which requires trade-offs. Second, this deal will always be uneven because India had such high tariffs on their goods, like Harley, etc., and they had literally no tariffs. It had to change someday because Trump wants a stronger US domestic manufacturing scene. The world and middle powers like India can't get a free ride forever exporting to the US. Thirdly, you must assess the trade deal or negotiation on a circumstantial hypothesis. Because if you don't accept what your economy is going to look like from all perspectives – socio-economical, etc. And if you do accept, then what? I mean, fairness on paper is one thing, and pursuing negotiation is another. Negotiation is not an emotional exercise. In terms of GDP and economic growth, India will stand to gain, with and not without. Your leverage is what you get in negotiation; no one will charitise, so a country which has the aspiration of being a global power should build leverage rather than worrying over Russian oil or the so-called strategic autonomy. Fourthly, many critics have said something about the regulatory sovereign loss. Well, we all know how the regulators in the Indian food and agri industry work. Indian regulators are so pathetic that it would be a better scenario for them to have an American regulator over the corrupt and incompetent Indian regulator of the food and agri sector or any sector of the Indian consumer economy.
The crux of the matter is that:
In any deal, gains will be proportionate to the size of the parties involved, so immediate gains are more for the US. The key point is, are we gaining? And the clear answer is that India gains in the short term and gains more in the long term as manufacturing becomes a strong point. Regarding committed imports – these are in the energy sector, and we buy a huge amount of crude, over a hundred billion a year, and around thirty billion worth is coming from Russia. An average of a hundred billion per year is not a big amount considering 30-40 billion worth of heavy Venezuelan crude is coming to the Reliance refinery in Jamnagar and getting exported to Europe. Average Indian exports will be much more than 100 billion a year. Also, the worries about CAD or the reverse of the moderation in domestic inflation are overrated, based on fearmongering and the usual dataless predictions that this would happen and that would happen.
Thus, people should be doing this so-called 'performative pessimism', reading pragmatism as collapse and every negotiation as capitulation. National interest is not served by pointing fingers and declaring, “You fell,” but by quietly strengthening economic resilience, institutional depth, and strategic leverage. A confident nation does not need moral theatrics like autonomy and sovereignty; it needs calibrated realism. Pragmatism is not retreat; it is maturity In a volatile, transactional world, pragmatism is not moral weakness but statecraft. Power asymmetry is not a discovery of recent diplomacy; it is the default condition of international relations. The real abdication of independent judgement lies not in acknowledging constraints, but in refusing to engage with them. Nations are not run to win moral arguments or trumpet the triumph of one ideology over another; they are run to preserve capacity and future choices. Flexibility under uncertainty is not surrender; it is judgement applied without illusion.
Agreed the snapback clause regarding Russian crude weaponises trade which is dangerous trend going all around the world .
India intends to purchase vs your article stating commits is miles apart. India's digital service tax removal also taken back by white house.
Bangladesh zero tarrif hinges on using US yarn which is more expensive as raw material .
Indias 42% exports are tarrif exempt ( generics etc )while 58% has 18 bringing weighted avg tarrif to 10.4% approx which is quite less scary than 18% headline
All in all my humble view was that it's not as lopsided as being portrayed in the article. But to each his own view. Love your all other articles always. Cheers
Hey Shrey, as mentioned earlier, we've indeed highlighted the tariff reduction on generics and many other items. Bangladesh's deal on using US yarn also proves our point about how the USMCA was designed to enforce that.
Perhaps, calling the 500B figure a "commitment" was too strongly worded. But this is from the official joint US-India statement. It is worth analyzing both what's in there and what's not, and what it means overall.
Dear team
I enjoy the level of research done by your team but it seems like the team missed a trick here.
1. Indian commerce minister has said on record india has not committed to buy anything
2. India has protected it's dairy and agri sector except industrial agri raw materials
3. India has not committed to buying US energy and the discount on Russian oil has been decreasing due to sanctions
4. India went from 2.4% to 18 is not very smart statement because that was pre trump as all countries EU , uk , South Korea Japan all have had their pre trump tarrifs increased and have settled around 15-20% as the new normal
Just humble feedback
Hi Shrey, thanks for your comment.
1. Do check out the statement from the White House. A trade deal isn't, per se, *binding* because there is no central authority (not even the WTO) to reinforce them if something goes wrong. However, there is indeed a $500B figure that India intends to purchase from the US which the official White House statement contains. But there is no such figure from the other side. It's about analyzing the power dynamic, which the statement clearly shows.
Link: https://www.whitehouse.gov/briefings-statements/2026/02/united-states-india-joint-statement/
Link to the statement on Russia (this is an executive order, separate from the updated factsheet, but official): https://www.whitehouse.gov/presidential-actions/2026/02/modifying-duties-to-address-threats-to-the-united-states-by-the-government-of-the-russian-federation-04b2/
2. We haven't really mentioned agriculture as a sore point of contention in the entire piece, either.
3. Coking coal and *energy products* are explicitly part of the 500B figure. Moreover, in the same vein as 1), the commitment may not be binding - we are still very free to purchase Russian oil. But there are now active harmful consequences to this.
4. This is precisely why we do mention in the piece that it is indeed rational for India to pursue a deal with the US to gain an advantage over peers. We also admit that, perhaps, this might have been the best deal we could possibly get. But it is also clear that if India can, everyone else will - Bangladesh has followed suit not long after our deal, and their terms on textiles are probably better than ours. This will be a race to the bottom among all countries to get favorable terms with the US, and the idea that this new normal of exorbitant tariffs should be accepted is not a healthy premise. The problem starts with the premise itself.
>>But there are now active harmful consequences to this.
Yeah, like what?? India would abandon Russia. Is Russian crude even paying the same dividend as it did when it was $4-6 cheaper than the crude at a market level? If one looks at the data, then there's not much difference between the Brent crude and Ural crude now. Didn't India stop Iranian oil when the yanks told Delhi? Didn't they do the same with VZ crude?? Therefore, this is not the first time that this has happened.
Wow! Pranav so nicely put down the points against a seemingly andh bhakt's bias to show a bad deal as a good one! 🙏.. my respect for your team's work has gone up. Thank you.
The Kiel Institute report you quote is not entirely correct. “As the Kiel Institute’s research shows, the 18% tariff functions as a consumption tax on Americans. But the Trump administration appears willing to accept that trade-off for now. The logic, whether it works or not, is to protect American supply chains, even if it means Americans pay more.” Several US studies show that the passthrough of import tariffs has a marginal effect on the CPI which is what matters to US households, certainly not of the double-digit order of magnitude, as the Kiel study seems to imply. .
See this study and also several related studies, both from the Fed and other institutions:
https://www.federalreserve.gov/econres/notes/feds-notes/detecting-tariff-effects-on-consumer-prices-in-real-time-20250509.html
It concludes that:
“We then apply our methodology in real time, showing that tariffs implemented on China in February and March of 2025 have already affected consumer prices. So far, the effect of these tariffs has been a 0.33 percentage point increase in core goods PCE prices, contributing to a 0.08 percentage point increase in core PCE prices. As more or higher tariffs are imposed, we think our methodology will continue to be useful in assessing tariff effects on consumer prices.
We caution that our analysis pertains only to the consumer price effects of tariffs that the US has imposed on other countries. Our methodology is silent about the effects of retaliatory tariffs. It is also silent about any potential tariff effects on other outcomes, such as productivity and employment.”
Thank you for a very nice perspective backed up with sources and data as usual giving food for thought. I think 2.4% to 18% or 50% to 18% is subject to individual vantage point…
Wonder if the title of the article could have been a bit different…
Hi Ashish, thanks for your comment! It is, perhaps, subject to an individual vantage point. But it's worth noting that not long ago, we did have a 2.4% rate. The power dynamic has shifted too quickly in favor of the other party.
Not long ago, when?? Why are you still equating the world pre-Liberation Day, man?? Power dynamics were always with the yanks. Anyone, even his underpants won't be oblivious to that reality.
Great article team...
Great read! Regarding the section on the need for a corporate bond repo facility, I wanted to highlight that AMC Repo Clearing Limited (ARCL) is currently active in this space and is already conducting significant repo transactions in the corporate bond market.
I have shared a detailed note on the community Reddit analyzing the current volumes (approx. INR 76k Cr in Dec '25) and the collateral baskets here: https://www.reddit.com/r/marketsbyzerodha/comments/1r2l2rl/greasing_the_wheels_how_arcl_is_quietly_solving/
For further technical details, you can also check the ARCL website directly: https://www.arclindia.com/
Hope this adds to the discussion!
I saw the recent daily brief of Zerodha on YouTube today, and man, it was such a partisan analysis. They even used that ChatGPT-generated table from that fraud Chellaney's tweet. And adding that the former CPI (M) Neta and SFI activist, now turned Congress party wannabe leftist economist, the Hindu opinion piece tells how partisan this analysis has been. That opinion piece is nothing but another gaslighting piece of crap.
Firstly, having been protectionist for decades, India needs to open up its economy for imports to build a domestic economy and self-reliance in all major sectors. Private sector investment is low, and we need foreign investment for a growing economy, including into new fast-growing sectors like AI… which requires trade-offs. Second, this deal will always be uneven because India had such high tariffs on their goods, like Harley, etc., and they had literally no tariffs. It had to change someday because Trump wants a stronger US domestic manufacturing scene. The world and middle powers like India can't get a free ride forever exporting to the US. Thirdly, you must assess the trade deal or negotiation on a circumstantial hypothesis. Because if you don't accept what your economy is going to look like from all perspectives – socio-economical, etc. And if you do accept, then what? I mean, fairness on paper is one thing, and pursuing negotiation is another. Negotiation is not an emotional exercise. In terms of GDP and economic growth, India will stand to gain, with and not without. Your leverage is what you get in negotiation; no one will charitise, so a country which has the aspiration of being a global power should build leverage rather than worrying over Russian oil or the so-called strategic autonomy. Fourthly, many critics have said something about the regulatory sovereign loss. Well, we all know how the regulators in the Indian food and agri industry work. Indian regulators are so pathetic that it would be a better scenario for them to have an American regulator over the corrupt and incompetent Indian regulator of the food and agri sector or any sector of the Indian consumer economy.
The crux of the matter is that:
In any deal, gains will be proportionate to the size of the parties involved, so immediate gains are more for the US. The key point is, are we gaining? And the clear answer is that India gains in the short term and gains more in the long term as manufacturing becomes a strong point. Regarding committed imports – these are in the energy sector, and we buy a huge amount of crude, over a hundred billion a year, and around thirty billion worth is coming from Russia. An average of a hundred billion per year is not a big amount considering 30-40 billion worth of heavy Venezuelan crude is coming to the Reliance refinery in Jamnagar and getting exported to Europe. Average Indian exports will be much more than 100 billion a year. Also, the worries about CAD or the reverse of the moderation in domestic inflation are overrated, based on fearmongering and the usual dataless predictions that this would happen and that would happen.
Thus, people should be doing this so-called 'performative pessimism', reading pragmatism as collapse and every negotiation as capitulation. National interest is not served by pointing fingers and declaring, “You fell,” but by quietly strengthening economic resilience, institutional depth, and strategic leverage. A confident nation does not need moral theatrics like autonomy and sovereignty; it needs calibrated realism. Pragmatism is not retreat; it is maturity In a volatile, transactional world, pragmatism is not moral weakness but statecraft. Power asymmetry is not a discovery of recent diplomacy; it is the default condition of international relations. The real abdication of independent judgement lies not in acknowledging constraints, but in refusing to engage with them. Nations are not run to win moral arguments or trumpet the triumph of one ideology over another; they are run to preserve capacity and future choices. Flexibility under uncertainty is not surrender; it is judgement applied without illusion.