US president Donald Trump took yet another shot at India on ongoing trade differences and accused it Saturday of charging “over 100%” import duty on certain American goods.
This was his second such attack on India in one week, marking a new escalation that should worry New Delhi, which is trying to prevent the Trump administration from terminating benefits accruing to India from a duty-free tariff programme under which India exported $5.6 billion worth of goods to the US in 2017.
In a speech to the Republican Jewish Coalition on Saturday, President rolled out by now his well-known list of trade issues, such as trade deficit and high tariffs, which could be, he said, “100% … 200%, 250%, 300% and we charge them nothing”.
“We have a case where a certain country,” he said, and added, after a dramatic pause, to laughter, “India.”
It is “charging us”, he resumed, but switched mid-sentence, as he does often, to another idea. “A great country, great friend Prime Minister Modi.”
It is “charging us,” he said, returning to the original idea, “over a 100% for many things (and) we’re charging them nothing for similar or the same product.” The existence or the number of such duties, of more than 100%, could not be immediately ascertained.
The president suggested the United States should be “charging them something”, because this is not about “free trade”, it’s “stupid trade”.
{{/usCountry}}The president suggested the United States should be “charging them something”, because this is not about “free trade”, it’s “stupid trade”.
{{/usCountry}}The American president has threatened to hit India with reciprocal taxes before, specially on motorcycles. He has complained about India levying 100% tariff on Harley-Davidson motorcycles imported from the United States, whereas the United States charges nothing on motorcycles it imports from India.
India has since cut duty on these motorcycle imports to 50%. But Trump continues to use the 100% figure as he did past Tuesday, April 2, when he also called India “one of the highest taxing nations in the world”.
“They charge us 100% tariff on goods. So they send a motorcycle--and they make a lot of them- Indian cycles,” Trump said at the annual spring dinner of the National Republican Congressional Committee.
He continued: “They send them to our country, we charge them nothing. We send a Harley Davidson to India and they charge us 100%. Not fair, okay. Not reciprocal. It’s not fair.”
President Trump’s trade rhetoric has often been followed by actions. He slapped India with 25% tariff on steel and 10% on aluminum along with other countries, and did not grant it a waiver as he did with others. And this past March, he informed US congress his intention to terminate India’s eligibility to continuing benefitting from the duty-free Generalized System of Preferences scheme. It will take effect early May, at the end of the mandatory 60-day notice period if India was unable to stop it, and the only way it can is to yield to US demands to grant market access to US-made medical devices and dairy products.
Failure to prevent the termination would subject GSP-covered Indian goods to usual import duties, which, in India’s estimation, could add up to $190 million annually. Not a big amount, but there are fears US buyers of these goods could shift to other GSP-covered suppliers to keep their costs down.