A major setback for India came when US President Donald Trump announced a 26 per cent tariff on Indian exports. This will cost Indian goods more to reach American consumers. America is benefiting from heavy tariffs on imports, while the rest of the world is paying its price.
What is new
26 percent tariffs have been imposed on all goods imported from India to America. Announcing his tariff policy, President Trump said that ‘India is very tough, very tough’. Referring to PM Modi, Trump said that Modi is my very good friend, I have told him that you are not treating us properly. Significantly, Trump has announced a 26 percent tariff on India, but India imposes 52 percent tariff on its US.
Since India imposed 52 percent tariffs, Trump implemented a “anti -anti -retardation tariff” of 26 percent. From April 5, all imports will be charged 10 percent tariffs and from April 9, the countries who have been accused of “cheating” by Trump.
Why is it important: India has suffered a setback despite giving Trump a concession on trade and immigration. The new tariff will affect electronics, gems and clothes. However, the pharmaceutical industry has been exempted from this.
26 percent tariff on Indian imports is 20 percent of the European Union, 24 percent in Japan and more than 25 percent in South Korea. This is 54 percent of China in China and less than 46 percent of Vietnam. America’s trade deficit with India is worth $ 46 billion. Trump wants the tariff to continue till this problem is solved. India can cut tariffs of $ 23 billion on US imports to please Trump administration.
Effect on the world: The US imposed an additional 34 per cent tariffs on Chinese goods in addition to the current 20 per cent fee. The UK was imposed 10 percent tariff, which is less than 20 percent expected. South Korean acting President Han Duck-Sura-Surag-25 vows to answer “every possible” against 25 percent of tariffs, while Japan’s Prime Minister Shigeru Ishiba questioned Tariff and said that Japan makes the biggest investment in America.
Status of Canada and Mexico: Canada and Mexico are exempted from new tariffs, but 25 percent tariffs on Canadian steel, aluminum and auto have come into force.
Trump described India as “very strict” at a White House program and said, “You are friends, but are not treating us properly,” This statement came after Prime Minister Narendra Modi’s visit. He cited India’s 52 percent fee. India is already struggling with a slow growth rate and this business move is likely to suffer losses. Last year, India’s growth rate was 6.5 percent, which is the slowest after epidemic.