President Donald Trump has vowed to slap India with 25 per cent tariffs on imports from India, with an extra unspecified “penalty” to be introduced, in an attack on its trade with Russia and “obnoxious” rules and standards.
Ahead of a Friday deadline for “reciprocal” tariffs, Trump revealed Indian exports would be subjected to higher taxes.
In a post on Truth Social, the US president said: “Remember, while India is our friend, we have, over the years, done relatively little business with them because their Tariffs are far too high, among the highest in the World, and they have the most strenuous and obnoxious non-monetary Trade Barriers of any Country.
“Also, they have always bought a vast majority of their military equipment from Russia, and are Russia’s largest buyer of ENERGY, along with China, at a time when everyone wants Russia to STOP THE KILLING IN UKRAINE — ALL THINGS NOT GOOD! INDIA WILL THEREFORE BE PAYING A TARIFF OF 25%, PLUS A PENALTY FOR THE ABOVE, STARTING ON AUGUST FIRST.”
Several countries including Canada and South Africa are set to face varying levels of higher tariffs from this Friday.
Brazil is set to face the highest tariffs at 50 per cent while other countries have dodged a heightened trade war by securing deals.
The UK was the first country to agree to lower tariffs but an agreement on steel is yet to be made.
The European Union agreed to facing 15 per cent tariffs while China saw its tariff rate drop from 145 per cent to 30 per cent, while imposing 10 per cent tariffs of its own on US imports.
Trump has insisted he would not extend the deadline on the introduction of reciprocal tariffs again, with his latest attack on India setting the scene for a tense week of hard negotiations and wrangling over tariff rates.
Trump’s tariff effects
The IMF upgraded its global growth forecast in reaction to recent trade deals struck by the US president and major economies.
A global risk survey by Oxford Economics suggested businesses saw geopolitical tensions as a greater threat to the world economy than a trade war.
“Business uncertainty about global growth prospects appears relatively contained, in contrast with the substantial rise in uncertainty seen in the pandemic and in the aftermath of Russia’s invasion of Ukraine,” economists at the consultancy said.