President Trump introduced a 26 percent reciprocal tariff on India, citing unfair trade practices. The tariff is half of what India imposes on U.S. goods. Reactions from global leaders indicate widespread concern over potential economic repercussions, while India evaluates the implications and continues negotiations for a bilateral trade agreement.
On April 2, 2025, President Donald Trump announced the imposition of a 26 percent “discounted reciprocal tariff” on India. This announcement was made during an event in the Rose Garden at the White House. The rate is significantly lower than the 52 percent tariffs that India imposes on U.S. goods. Trump characterized this day as “Liberation Day,” symbolizing a rejuvenation of American industry and an essential step towards restoring America’s global trade position.
During his lengthy address, Trump highlighted the challenges faced by American workers due to foreign tariffs, stating, “For decades, our country has been looted, pillaged, raped and plundered by nations near and far.” He emphasized the need for reciprocity in trade agreements, leading to a historic executive order that would affect various countries imposing levies on American products.
Trump illustrated the disparity by citing that the U.S. imposes only a 2.4 percent tariff on motorcycles, while countries like India charge tariffs as high as 70 percent. He criticized past trade agreements, claiming that foreign governments have unfairly profited at the expense of American jobs.
Accompanied by workers and members of his Cabinet, Trump stressed the implications of these tariffs, which he claims are aimed at restoring fairness in international trade. By presenting data on international tariffs, he argued that the U.S. has been disadvantaged by previous trade practices.
Officials in India responded to the tariffs, stating that they are assessing their implications. While acknowledging that the new tariffs pose challenges, they characterized the situation as a “mixed bag” rather than a setback, indicating ongoing negotiations for a bilateral trade agreement with the U.S.
Sectors expected to be significantly impacted by these tariffs include electronics and gems and jewelry, among others. However, certain industries such as pharmaceuticals may remain unaffected. Global leaders, including those from the European Union and China, expressed concern over the potential adverse effects of the tariffs on global trade dynamics.
President Donald Trump’s announcement of a 26 percent reciprocal tariff on India marks a significant shift in U.S. trade policy. Amidst reactions from various global leaders and analysis by Indian officials, the move aims to address long-standing trade imbalances and enhance domestic industry competitiveness. Key sectors such as electronics and jewelry in India may face challenges, while ongoing negotiations could seek to alleviate the impact.
Original Source: m.economictimes.com
