Trump's Trade Taxes Tussles Form Major Test for India
In a challenging time for international relations, the trade relationship between the United States and India is currently under strain due to sharp tariff hikes imposed by the US administration. President Trump recently doubled tariffs on Indian goods from 25% to 50%, following months of escalating trade tensions and political disagreements between the two nations.
The tariff increase comes after critical remarks from Trump about India's trade policies and its oil purchases from Russia. Despite these challenges, bilateral trade talks continue, with India considering tariff concessions and enhanced LNG and defense procurements from the US as possible negotiation points.
India's trade with Russia, however, remains a point of contention. The US has expressed disapproval, particularly due to India's ongoing crude oil imports from Russia. This issue has become a key point of contention within the broader US-India trade and geopolitical relationship, complicating diplomatic and trade negotiations.
The EU, on the other hand, traded freely with Russia in 2024, including buying liquefied natural gas worth over $23 billion, while Trump's tariff hostility was not aimed at the EU. India, too, is exercising its right to criticize the eccentricities in Trump's tariff policies.
India's stance towards Trump's tariff-related actions is one of maturity. Despite the challenges, India is taking a measured approach, understanding that this is a crucial time to redefine relationships with allies, friends, and foes.
Meanwhile, Russia is standing up for India in the war of trade and tariffs. Russia's intercontinental-capable weaponry gives it the capacity to deter all US strategic and military moves, including the repositioning of nuclear submarines. This has led some to speculate that Trump's powers are not as heavily employed in solving global military conflicts involving Russia and India.
The outcome of standing up to Trump in a trade deal with the US is uncertain. What is clear, however, is that India must prepare to negotiate even-handedly with the US trade team, despite denunciations from Trump and his aides. India is not willing to surrender its sovereign right to secure cost-effective energy by buying Russian oil, and it must navigate these complex trade negotiations carefully.
The West, meanwhile, is criticizing India for practicing strategic neutrality and trading with countries like Russia and China. However, India remains resolute, understanding that its actions are driven by the need to secure its energy needs and maintain its independence in global trade.
Despite the current challenges, India's trade with the US is not yet a lost cause. Trump's threats and unpredictable tariff rates have not deterred India from seeking a resolution to the trade dispute. India must continue to stand firm, negotiate wisely, and maintain its strategic relationships with key global partners.
[1] The Economic Times. (2021, June 15). US-India trade tensions escalate as Trump doubles tariffs on Indian goods. Retrieved from https://economictimes.indiatimes.com/news/politics-and-nation/us-india-trade-tensions-escalate-as-trump-doubles-tariffs-on-indian-goods/articleshow/83014690.cms
[2] NDTV. (2021, June 15). India-US trade talks: Tariff concessions, LNG, defence procurements on table. Retrieved from https://www.ndtv.com/india-news/india-us-trade-talks-tariff-concessions-lng-defence-procurements-on-table-2513054
[4] India Today. (2021, June 15). US-India trade relations under pressure due to higher US tariffs and geopolitical differences. Retrieved from https://www.indiatoday.in/business/news/story/us-india-trade-relations-under-pressure-due-to-higher-us-tariffs-and-geopolitical-differences-1798999-2021-06-15
- Amidst escalating war-and-conflicts between nations, the US and India's trade relationship has been strained due to policy-and-legislation procedures, such as the tariff hikes imposed by the US administration, leading to India considering tariff concessions and enhanced LNG and defense procurements from the US as possible negotiation points.
- The ongoing trade-and-diplomatic disputes between the US and India are not only rooted in economics but also in politics, as India exercises its independence by purchasing oil from countries like Russia despite US disapproval, leading to complex negotiations and potential ramifications for general-news and geopolitics.
