New Delhi: In a countermove reflecting escalating trade tensions, India has proposed new tariffs on select US goods, including steel and aluminium duties imposed by the Trump administration.
This marks India’s first retaliatory action against President Donald Trump’s tariff regime, even as both nations inch closer to finalising a comprehensive trade agreement.
Reports from news agencies Bloomberg and Reuters reveal details from a document submitted to the World Trade Organisation (WTO) on May 12. “The proposed suspension of concessions or other obligations takes the form of an increase in tariffs on selected products originating in the United States,” the document mentions.
The document outlines India’s intention to suspend concessions or obligations by increasing tariffs on specific products imported from the United States. However, it does not specify which products are likely to be affected by these proposed tariffs.
This comes after the US imposed 25 per cent tariffs on steel and aluminium imports in March, an extension of tariffs originally introduced in 2018 during Trump’s first term.
According to the WTO submission, these retaliatory measures could impact approximately 7.6 billion dollars worth of Indian-made products entering the US market. The US has enforced steel and aluminium duties and threatened additional reciprocal tariffs of 26 per cent on Indian goods. In light of these tensions, both countries are working towards a trade deal, with India indicating a willingness to significantly reduce its tariff disparity with the US by two-thirds.
India, recognised as the second-largest producer of crude steel globally, has previously faced accusations from Trump of being a “tariff abuser.” In response to ongoing challenges in the steel market, India recently imposed temporary tariffs of 12 per cent on cheap steel imports, predominantly from China, as part of its strategy to bolster domestic production.
As negotiations for a bilateral trade agreement continue, experts like Ajay Srivastava from the Global Trade Research Initiative caution that India’s latest WTO action comes at a precarious time. The potential for retaliation could complicate discussions aimed at establishing a broader free trade agreement between New Delhi and Washington.
“India’s latest WTO action comes at a delicate moment,” said Ajay Srivastava, founder of New Delhi-based think-tank Global Trade Research Initiative was quoted as saying by Hindustan Times, adding New Delhi and Washington are exploring a broader free trade agreement, and this retaliation could cast a shadow over negotiations.”
