New Delhi, Imposing reciprocal duties violates world commerce guidelines however one has to comply with a “wait and wait” strategy to US President-elect Donald Trump’s remarks on imposing reciprocal tariffs, a senior official mentioned on Wednesday.
US President-elect Donald Trump has mentioned that India costs lots of tariffs, reiterating his intention to impose reciprocal tariffs in retaliation for what New Delhi will impose on the import of sure American merchandise.
Trump made these remarks on Tuesday and in addition mentioned that India and Brazil had been amongst nations that impose excessive tariffs on sure US merchandise.
“It will likely be very troublesome to decipher from one or two sentences which Mr Trump makes but when I understood from what he was saying. His primary intent is that reciprocity will matter in future. So in case you are placing a tax on Harley-Davidson we may also put a tax in your motorcycle exports. So from that perspective, this might be in clear violation of the WTO norms however there are situations when Mr Trump has used measures like Part 232 of the Tariff Act which permits the US to take unilateral measures in opposition to nations on nationwide safety grounds.
“So one should wait and watch and see,” Director Common of International Commerce Santosh Kumar Sarangi mentioned right here at CII’s export competitiveness occasion.
He mentioned that there are a lot of areas the place India has tariff peaks however the nation doesn’t essentially export these to the US.
For instance, India has excessive customs duties on various agri items however they don’t seem to be essentially exported to America.
“So if the US makes use of reciprocity and imposes taxes on that, it won’t hurt us in a serious method however there might be just a few objects the place this reciprocal precept factor may impression us,” he mentioned.
Additional, he added, “So one has to attend and watch, how it’s panning out and the fantastic print of this might be obtainable solely after they bear a course of like they’ve a course of like they’ve a course of the place the USTR examines, investigates and recommends an motion. Earlier than guessing the impression, one should wait and watch as to that are the sort of merchandise that they’re taking a look at.”
In 2019, Trump repeatedly claimed that India is a “tariff king” and imposes “tremendously excessive” tariffs on American merchandise. He has criticised India’s “massive tariffs” on American paper merchandise and the long-lasting Harley-Davidson bikes.
The US was the most important buying and selling accomplice of India in 2023-24. India’s exports stood at USD 77.51 billion, whereas imports aggregated at USD 42.2 billion within the final fiscal.
In FY2024, India’s high exports to the US included medicines , Clothes and Made-ups , Lower and Polished Diamonds , Smartphones , Photo voltaic Cells , Shrimps , Gold Jewelry , Auto Components , Metal , and Articles of Metal .
Commenting on the Trump remarks, suppose tank GTRI mentioned whereas Indian tariffs adjust to WTO guidelines, the proposed Trump tariffs would violate them.
“Regardless that Trump’s claims about Indian tariffs could also be overstated, India can seize this second to strategically evaluate its tariff construction. India’s common tariff stands at 17 per cent, considerably larger than the USA’s 3.3 per cent, however akin to nations like South Korea and China ,” World Commerce Analysis Initiative Founder Ajay Srivastava mentioned.
He mentioned that if Trump proceeds with unilateral tariffs in opposition to India, he might be violating the US commitments on the WTO on tariffs.
On this case, India must be prepared to reply decisively, he mentioned.
In 2018, when the US imposed tariffs on Indian metal and aluminium, India retaliated by rising tariffs on 29 particular American merchandise. This well-calibrated response ensured that India collected equal income from US imports, demonstrating its capability to safeguard commerce pursuits whereas sustaining a balanced strategy.
“India should be ready to navigate potential challenges within the Trump period and never be caught off guard,” Srivastava mentioned, including {that a} focused discount in tariffs might be advantageous for India, aligning with its aim of boosting low-cost, value-added manufacturing and commerce.
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