India is contemplating reducing import tariffs on high-end motorcycles to zero as part of its strategy to negotiate a trade agreement with the United States. This move is aimed at addressing tariffs that primarily affect American motorcycle manufacturer Harley-Davidson. Currently, India has reduced tariffs on motorcycles with an engine capacity of 1600cc and below from 50% to 40%.
The proposal, which is still under consideration, targets motorcycles with an engine capacity of 750cc or more. The final inclusion of this proposal in the U.S.-India trade agreement will depend on the progress of negotiations. Given that large-displacement motorcycles constitute a minor segment of India's market, this concession is unlikely to significantly impact the local industry.
Additionally, India is open to extending similar zero-tariff arrangements to auto parts, a sector where it holds competitive export advantages with minimal domestic opposition. This gesture is part of India's broader efforts to improve trade relations with the U.S., following past criticisms by President Trump regarding India's tariff policies.
