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Why is US probing India, 15 others over trade practices? Full list of countries under scanner
The investigation was announced by US Trade Representative Jamieson Greer, who said it would be carried out under Section 301 of the Trade Act.
The United States has launched a probe into the trade practices over at least 16 economies of the world to determine whether they “burden or restrict” US commerce. The investigation was announced by US Trade Representative Jamieson Greer, who said it would be carried out under Section 301 of the Trade Act focused on alleged excess manufacturing capacity.
India was among the 16 economies listed in the Trump administration's announcement. Full list of countries under US scanner:
- Singapore
- Switzerland
- Norway
- Indonesia
- Malaysia
- European Union
- Cambodia
- Thailand
- Korea
- Vietnam
- Taiwan
- Bangladesh
- Mexico
- Japan
- India
As Greer announced the investigation, he said that the US would no longer let countries likely “exporting problems with excess capacity and production” use its industrial base anymore. "Today’s investigations underscore President Trump’s commitment to reshore critical supply chains and create good-paying jobs for American workers across our manufacturing sectors,” said Greer.
Why is US probing 16 economies?
The US trade representative linked the move to prioritising American talent and strengthen supply chains. Greer also said that the structural excess capacity and production in manufacturing sectors of some countries is challenging Trump's re-industrialisation efforts.
In simple terms, the US believes that some economies are manufacturing more products than they can consume domestically, eventually limiting domestic production and investment expansion for the US.
“In many sectors, the United States has lost substantial domestic production capacity or has fallen worryingly behind foreign competitors,” Greer said.
However, the announcement is also being viewed as the Trump administration's attempt to rebuild the tariff wall, struck down by the US Supreme Court recently.
According to Bloomberg report, Donald Trump needs this probe to unilaterally place duties on imports from countries deemed to employ unfair trading practices. The investigation is expected to take months to complete.
“Our view is that key trading partners have developed production capacity that is really untethered from the market incentives of domestic and global demand,” Greer said.
Probe for India months after trade breakthrough
India is among the 16 economies set to be investigated by the US for its trade practices despite both countries recently finalising an interim trade deal, as part of which tariffs on Indian imports into the US were lowered to 18% from a whopping 50%.
Earlier this month, the US also granted a waiver to India on the purchase Russian oil amid supply crisis concerns caused by the ongoing conflict in West Asia, triggered by the US-Israel strikes on Iran.
A formal reaction from India on the trade practices investigation announced by the US is still awaited.
