India and the United States have reached an agreement on a joint monitoring mechanism for India's steel and aluminum exports to the US, effectively sidestepping additional tariffs. This development follows the resolution of all pending bilateral trade disputes at the World Trade Organization during Prime Minister Narendra Modi's June 2023 visit to Washington.

The terms of reference for the joint monitoring mechanism have been finalized by India's Department of Commerce, allowing certain steel and aluminum products to enter the US without incurring extra duties. The US has accepted this proposal, facilitating the import of 336,000 tonnes of steel and aluminum from India, exempt from additional duties imposed under a national security law by the Trump administration in 2018.

The decision also marked India's withdrawal of a 20% additional duty on apples and walnuts, along with a ₹20 per kg levy on almonds imported from the US in 2019. These retaliatory measures were in response to the US increasing tariffs on specific steel and aluminum products.

While there is no reduction in the most-favored-nation (MFN) duties on apples, walnuts, and almonds, which still stand at 50%, 100%, and ₹100 per kg, respectively, the new monitoring mechanism aims to facilitate smooth progress in steel and aluminum exports. The mechanism will convene every six months to address potential disputes and ensure its seamless operation.

An inter-ministerial mechanism within the Indian government, comprising the Departments of Mines, Steel, and the Department for Promotion of Industry and Internal Trade (DPIIT), will oversee the hassle-free entry of Indian steel and aluminum exports into the US without additional duties. Any obstacles faced by Indian exporters will be communicated to the Commerce Ministry and addressed during joint monitoring mechanism meetings with the US.