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Published on
April 22, 2025
5 min read
India Under Tariff Pressure to Grant Amazon and Walmart Full Market Access
India is being pressured by the United States to give Walmart and Amazon access to its $125 billion online market. According to Reuters, the U.S. administration insists that India ease foreign online retail laws during trade talks. The two companies currently operate Indian local subsidiaries. But they are kept away from storing merchandise and selling directly to customers at the end-user level, unlike Indian players such as Reliance.
The U.S. is aiming to create a level playing field for American companies in India’s e-commerce and quick commerce space. This is one of the issues in broader trade talks across many sectors, including food and automobiles.
The negotiations are important because India wants to seal a trade agreement to avoid potential U.S. tariffs. President Trump announced a 90-day temporary freeze on tariff hikes on April 9.
U.S. Applies Pressure on India to Provide Equal Opportunities in E-Commerce Segment
The US government is pressuring India to make its e-commerce policies available, which already prohibit foreign companies like Walmart and Amazon. Companies are prohibited from storing inventory or directly selling to customers. This makes them less competitive than the Indian companies such as Reliance. The Americans believe that these prohibitions crush fair competition as well as the investment opportunities for their firms.
Amazon and Walmart have invested more than $5 billion and $16 billion, respectively, in the Indian market. The existing regulations have made them modify their business structures, which has raised both operational expenses and business complexity. The U.S. wants India to loosen these regulations to create a freer and more competitive market environment.
India-U.S. Trade Negotiations Progress
Indian Prime Minister Narendra Modi and U.S. Vice President JD Vance engaged in advanced trade negotiations following their recent meeting. The negotiating parties from both sides show enthusiasm about reaching a mutually beneficial agreement. The Indian Finance Minister, Nirmala Sitharaman, expressed that India will finalize its first trade agreement phase with the United States during autumn 2025.
The trade negotiations include numerous sectors such as defense and energy. America is also pressuring India to reduce its reliance on Russian defense equipment and purchase more American goods. The United States has requested reduced customs duties on its goods because the average tariff level of India exceeds the U.S. average tariff level.
India’s E-Commerce Policies and International Relations
There are several regulations put in place by India to govern e-commerce. These are aimed at safeguarding small traders and domestic businesses against international competition. The domestic trade associations have received these regulations positively because they believe they stop predatory pricing while ensuring free competition. The U.S. asserts that these policies harm American enterprises. This could affect the partnership between the nations.
The negotiations toward a complete trade agreement between India and the U.S. require a solution that would safeguard domestic interests. The alignment of e-commerce regulations, which enhances market access for Walmart and Amazon, operates as a major progression. This move could help strengthen the economic ties between the two nations.
