Trump’s Tariff Proposals Target China and India
Former US President and Republican presidential candidate Donald Trump has renewed his call for significant tariff increases on imports. Recently labeling India a “very big abuser of tariffs,” Trump proposed imposing a 60% tariff on goods from China and up to a 20% tariff on all other imports. Trump, who identifies as “Tariff Man,” insists that “tariffs are the greatest thing ever invented.” He has previously voiced concerns about tariff abuse from countries like China and India, criticizing India’s high tariffs on Harley-Davidson motorcycles as indicative of an unbalanced trade relationship.
During his first presidential term, Trump labeled India as a “tariff king” and in May 2019, he revoked India’s preferential market access under the Generalized System of Preferences (GSP), claiming the country had not provided the US with “equitable and reasonable access” to its markets. He also raised import duties on Indian steel and aluminum, prompting retaliatory tariffs on American goods by India. In an interview last August, Trump condemned India’s tax rates, describing them as excessively high.
Economic Experts Warn of Negative Consequences
Trump’s push for increased tariffs has sparked concern among US economists, who generally view tariffs as an inefficient means for governments to raise revenue and promote economic prosperity. Experts warn that if targeted countries retaliate with their own tariffs, Trump’s proposals could contract the US economy by more than one percentage point by 2026 and increase inflation by 2 percentage points next year.
Economists note that tariffs elevate costs for businesses and consumers reliant on imports and often trigger retaliatory measures. For instance, the European Union countered Trump’s steel and aluminum tariffs by imposing taxes on US products like bourbon and Harley-Davidson motorcycles. Likewise, China retaliated during Trump’s trade war by imposing tariffs on American goods such as soybeans and pork, affecting his supporters in rural areas.
A study conducted by economists from MIT, the University of Zurich, Harvard, and the World Bank found that Trump’s tariffs did not achieve their intended goal of restoring jobs in the American heartland, concluding that the tariffs “neither raised nor lowered US employment” in the sectors they were designed to protect.