Modi Good Friend But India Very Tough, Says Trump
Break10 Web Desk: In a move that could escalate trade tensions between New Delhi-Washington, United States (US) President Donald Trump announced a 26 percent “discounted reciprocal tariff” on imports from India, effective 9 April. The measure aims to address the substantial trade imbalance and India’s comparatively high tariffs on US goods.
During his announcement, Trump referred to Indian Prime Minister Narendra Modi as a “great friend” but expressed dissatisfaction with India’s trade practices, stating, “India, very, very tough… they charge us 52 percent. You have to understand, we charge them almost nothing, for years and years and decades.”
The newly imposed tariff is part of a broader strategy to encourage reciprocal trade practices among nations. While the move is intended to pressure India to reduce its tariffs, it has raised concerns about the potential impact on various sectors. Key exports like electronics, gems, and jewellery are expected to be significantly affected. However, pharmaceuticals have been exempted from the tariffs, providing some relief to that sector.
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The Indian government, in response, has expressed its intention to study the implications of the new tariffs and is considering measures to mitigate their impact. The commerce ministry is reportedly analysing the situation and exploring opportunities that may arise from the changing trade dynamics. India is contemplating reducing tariffs on approximately $23 billion worth of US imports. These include gems, jewellery, pharmaceuticals, and auto parts.
Financial markets reacted with caution to the reciprocal tariff announcement. Indian indices experienced modest declines. However, the impact was less severe compared to other Asian markets, attributed to India’s relatively lower tariff rate compared to some regional competitors.
