President Donald Trump’s 26% tariff on Indian imports took effect officially on Wednesday morning, amping up global trade tensions. The retaliatory tariff, one of the many moves in a larger protectionist drive by Trump, was initially announced during his ‘Liberation Day’ speech on April 3 in the White House Rose Garden.
Trump Targets Trade Surplus Nations
In his speech, Trump declared that the US would slap a baseline 10% tariff on almost all of America’s trading partners and higher rates on those countries that have trade surpluses with the US. India, Vietnam, Taiwan, South Korea, Japan, the European Union, and China were among the large economies targeted with new tariffs.
India presently has a 26% duty, Vietnam is slapped with a 46%, Taiwan with a 32%, South Korea with a 25%, Japan with a 24%, and the EU with 20%. China, which was already been charged a 20% duty a few months back, now additionally has a tariff of 34% slapped upon it. Trump also threatened the imposition of another 50% tariff on Chinese products if the latter retaliates.
In spite of the stern approach, Trump admitted his individual chemistry with Indian Prime Minister, Narendra Modi. “Their Prime Minister (Narendra Modi) recently left (the US). He is a wonderful friend of mine, but I told him that ‘You’re my friend, but you’ve not been treating us well. ‘ India is charging us 52%, so we will charge them half of that – 26%,\” Trump said while making his announcement.
India Reacts Guardedly
The Indian government reacted in response to the announcement by stating that it is considering the impact of the new tariffs and seeking to understand how this change in American trade policy could open up new possibilities.
The Union Commerce Ministry said it is “engaged with all stakeholders, including Indian industry and exporters, taking feedback on their assessment of the tariffs and viewing the situation in light of a vision of a developed India.”
When the complete impact of the tariffs starts to trickle through international markets, India’s next steps will be scrutinized at home and abroad.
