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The article analyzes former US President Donald Trump's approach to trade tariffs, particularly concerning India. It argues that Trump's policies are rooted in a flawed understanding of international trade and exhibit bullying tactics, despite India's compliance with World Trade Organization (WTO) rules. The author contends that Trump's “Make America Great Again” slogan, while resonating domestically, masks an imperialistic mindset that seeks to redress perceived unfairness by other nations towards the US. This perception of unfairness is then translated into aggressive trade policies, primarily the imposition of tariffs, which Trump views as a currency of power. The article criticizes this view, highlighting the vast disparity between the US and Indian economies and arguing that Trump disregards the principle of “special and differential treatment” for developing countries enshrined in WTO regulations. The author emphasizes that while India and the US have legitimate trade disputes, these should be addressed through established mechanisms, not unilateral and coercive measures. Trump's actions are depicted as undermining multilateralism and international cooperation. His reasoning regarding trade imbalances is portrayed as simplistic and failing to account for the complexities of global trade relationships and the historical context of US economic dominance. The author suggests that Trump's actions stem from a sense of victimhood, ignoring the perception held by many non-Western nations that they have been historically disadvantaged by US power and policies. Trump's desire for reciprocity in trade is challenged by outlining differences in export baskets and average tariffs between the two countries. Furthermore, it criticizes Trump's overall approach to foreign policy, referencing issues such as his approach to Greenland, the Panama Canal, and his withdrawal from international agreements. In essence, Trump is accused of undermining multilateral institutions and resorting to unilateral actions to assert US economic power. The author asserts that Trump's stance toward India is unfair and overlooks historical and economic realities.
The article elaborates on the specific points of contention between the US and India regarding tariffs. Trump's assertion that India charges 100% tariffs on US auto exports is highlighted as an example of his flawed logic. The author clarifies that India's tariff structure is not specifically aimed at the US and complies with WTO guidelines. The article underscores the US's obstruction of the WTO's Dispute Settlement Mechanism, hindering the resolution of trade disputes through established international procedures. It then delves into the history of the Doha Round negotiations, where India advocated for special safeguards to protect its farmers and sought reductions in trade-distorting farm subsidies from rich countries. The collapse of these negotiations is attributed to opposition from developed nations, highlighting the challenges developing countries face in achieving fair trade terms. The author emphasizes the stark economic disparity between the US and India, arguing that Trump's demand for equal treatment ignores this crucial difference. The US, with its significantly larger economy and per capita income, possesses considerable advantages in technological strength, capital resources, and the global dominance of the US dollar. This financial power enables the US to weaponize its currency and the global financial system to exert economic pressure. In discussing the implications for the US, the article emphasizes that Trump is threatening the very foundations of the liberal international order that the U.S. helped to establish.
Despite the criticism of Trump's policies, the article recognizes the importance of the India-US relationship. The US has become India's largest economic partner in goods and services, a major investor, a source of advanced technology, and a crucial defense partner. Therefore, the author argues that careful management of this relationship is essential, even in the face of Trump's unpredictable behavior and protectionist rhetoric. India has demonstrated nimbleness in addressing Trump's concerns about tariffs and market access. The article notes that even during Prime Minister Modi's visit to Washington, Trump made blunt remarks about Indian tariffs, simplifying the issue to the point of absurdity. The article highlights Trump's directive to his administration to conduct a detailed study of tariff structures, non-tariff barriers, and currency and regulatory issues that impede trade. It cautions against precipitating matters and disregarding the complexity of these issues. India had prepared for Modi's visit by conducting extensive research on tariffs and engaging in discussions with US trade officials. The Indian strategy involves pursuing a multi-sectoral bilateral trade agreement with the US, with an initial agreement expected by the fall of that year. As a gesture of goodwill, India announced a reduction in duties on certain products of interest to the US in its annual budget. Commerce Minister Piyush Goyal's visit to the US further signaled India's willingness to lower tariffs to expand bilateral trade. The author concludes by expressing hope that Trump's upcoming announcement on tariffs will not complicate the negotiations on the trade agreement. He emphasizes that no country prefers to negotiate under duress. The author's ultimate recommendation is for India and the US to work toward improving trade relations on a fair and sustainable basis. This is despite the difficult situation presented by the Trump Administration.
Source: Opinion | Trump's Approach To Indian Tariffs Reeks Of Bullying