US President Donald Trump has taken a fresh swipe at global trade practices, ordering his administration to consider reciprocal tariffs on several trading partners. The move, announced on Thursday, signals a tougher stance against countries that impose higher import duties on US goods.
A statement from the White House quoted Trump saying that while the US keeps its markets open, other nations put up trade barriers. “The United States will no longer tolerate being ripped off,” he said.
Trump explained that the new tariffs would match what other countries charge on American goods. “I will charge a reciprocal tariff, meaning whatever countries charge the United States of America,” he said, adding that in most cases, foreign tariffs are “vastly more” than what the US imposes.
According to a White House memo, these measures will be customised for each country to counter tariffs and other trade restrictions such as unfair subsidies, strict regulations, value-added taxes, currency policies, and weak intellectual property protections. Additionally, Trump hinted at further import taxes on cars, semiconductors, and pharmaceuticals beyond the reciprocal tariffs.
The timing is significant for India, as Trump made this announcement just hours before Prime Minister Narendra Modi’s visit. India, he pointed out, has “more tariffs than nearly any other country,” making it clear that it could be a target for these new measures.
During his campaign, Trump often criticised India’s trade policies, arguing that if India imposes high tariffs on American goods, the US should respond in kind. “An eye for an eye, a tariff for a tariff,” he had said.
Economists suggest that India could be among the most affected countries if Trump follows through on these tariff plans. Analysts at Morgan Stanley and Nomura Holdings believe that nations with higher tariffs on US exports, including India and Thailand, could face new trade pressures.
According to Bloomberg Economics, India’s average tariff rate on US imports is over 10 percentage points higher than what the US charges on Indian goods. Deutsche Bank analysts also see India’s tariff gap as a potential target for Trump’s measures.
However, there may be room for negotiation. Morgan Stanley’s research suggests that India could offset some of these risks by increasing its purchases of US defence equipment, energy, and aircraft.
For now, it’s a wait-and-watch situation. The US has not yet finalised its reciprocal tariff structure, and negotiations could play a big role in shaping the outcome.
(By arrangement with Livemint.com)
