International Trade Dispute: India Struggles Amid Trump's Intimidation Tactics Globally
The international trade landscape is currently in a state of flux, with the United States (US) engaging in complex negotiations with various global partners. This article will explore the ongoing trade tensions between the US and India, as well as the energy deals struck between the US and South Korea, and the European Union (EU).
Firstly, it's important to note that the EU cannot compel any member or company to buy US energy, and the quantities of energy the US would need to export are unavailable till 2030. Despite this, the US has been actively pursuing trade agreements, as evidenced by the recently announced deal with the EU during President Trump's golfing trip to Scotland on July 27. The EU has committed to buy $750 billion of US energy over three years, with an additional $600 billion in investment.
Meanwhile, trade tensions between the US and India have escalated. India's exports to the US cover key sectors like garments, pharmaceuticals, gems and jewelry, and petrochemicals. However, the current trade tensions primarily involve the US imposing a 25% tariff on Indian exports and threatening additional penalties related to India’s continued purchase of Russian oil and arms. These measures could impact about $64 billion of Indian exports to the US, reducing their competitiveness and potentially causing a 30% fall in exports to the US in the current fiscal year.
India's political parties have vehemently condemned the US's "bullying" approach, and the tensions have strained the broader strategic relationship, casting doubt on collaboration in forums such as the Quad and complicating planned high-level visits. India views its energy and defense purchases from Russia as driven by pricing, reliability, and strategic partnerships, but these moves contrast sharply with the US stance and have drawn Western political criticism.
In contrast, South Korea agreed to buy $100 billion of US liquefied natural gas and invest $350 billion in America. However, like the EU deal, these energy and investment deals lack details or implementation mechanisms, according to CNN's Richard Quest.
The US trade deals with the EU and South Korea reveal some similarities, suggesting US preferences. Yet, these deals also highlight the challenges the US faces in securing concessions from countries like India, particularly in sectors like agriculture and dairy, where India has shown stiff resistance to opening its markets.
Trump's remarks indicate resentment towards countries like India not agreeing to open their markets to meet his expectations. The BJP government must manage trade with the US over the next three years of the Trump presidency, and prepare to tolerate some pain or compromise tactically.
Trump has also targeted other countries, such as Brazil, announcing 50% tariffs and sanctions on the judge investigating former President Jair Bolsonaro. This suggests a broader trend of protectionist policies under the Trump administration.
The stumbling block in meeting Trump's expectations is a significant issue for India. The US has allowed South Korea to limit US beef imports and rice trade, and India may need to curtail its import of Russian energy to satisfy President Trump. However, India views its energy and defense purchases from Russia as crucial for its strategic interests.
In conclusion, the trade tensions have led to significant economic concerns for India, particularly regarding US market access and tariffs, while simultaneously complicating diplomatic relations due to divergent policies on Russian energy imports and military procurement. Managing these tensions will be a key challenge for the BJP government in the coming years.
[1] Source: The Economic Times [2] Source: Reuters [3] Source: The Hindu [4] Source: BloombergQuint [5] Source: NDTV
- The ongoing trade tensions between the US and India, as well as the energy deals struck between the US and South Korea, are part of a broader landscape of war-and-conflicts and policy-and-legislation in global politics, as nations negotiate their trade relationships.
- General news outlets have reported on the US's protectionist policies, with President Trump imposing tariffs on countries like India and Brazil, suggesting a shift towards conflict in international trade, particularly in the areas of agriculture, dairy, and energy.
