US President Donald Trump on April 2 announced that he is going to soften the blow of reciprocal taxes on India and impose only 27 per cent tariffs on Indian goods against 52 per cent duties charged by India on American products.
Even though Trump mentioned about a discounted reciprocal tariff of 26 per cent tariff on India during his address, according to the White House documents, there will be a 27 per cent duty on India, reported PTI.
Trump signed the executive order titled 바카라Regulating Imports with a Reciprocal Tariff to Rectify Trade Practices that Contribute to Large and Persistent Annual United States Goods Trade Deficits바카라 in the White House바카라s Rose Garden on Wednesday, describing it as 바카라Liberation Day바카라 and April 2 2025 as the day 바카라American industry was reborn.바카라
A fact sheet issued by the White House on reciprocal tariffs also includes similar tariffs that India imposes on US goods.
Describing 2 April 2025 as 바카라Liberation Day,바카라 Trump announced reciprocal tariffs of varying degrees on 185 nations. Trump imposed a 10 per cent tariff on all countries, which will take effect from 5 April 2025.
The order stated that Trump will impose an individualised reciprocal higher tariff on the countries with which the United States has the largest trade deficits. All other countries will continue to be subject to the original 10% tariff baseline, which will take effect from 9 April 2025.
Reciprocal Taxes On India
Trump announced a 26 per cent 바카라discounted reciprocal tariff바카라 on India, half of the 52 per cent levies imposed by India on American goods, as he described India as 바카라very, very tough.바카라
On India, the chart showed that the country charged 52 per cent tariffs to the US 바카라including currency manipulation and trade barriers,바카라 and America will now charge India 바카라discounted reciprocal tariffs바카라 of 26 per cent.
바카라India, very, very tough. Very, very tough. The Prime Minister just left. He바카라s a great friend of mine, but I said, 바카라You바카라re a friend of mine, but you바카라re not treating us right.바카라 They charge us 52%. You have to understand, we charge them almost nothing, for years and years and decades, and it was only seven years ago, when I came in, that we started with China and we took in hundreds of billions of dollars from China in tariffs,바카라 Trump said.
Prime Minister Narendra Modi had visited Washington DC in February, less than a month after Trump took the oath of office and began his second term in the White House as President.
Donald Trump Signs Executive Order On Reciprocal Taxes
In his nearly hour-long remarks on a cold Wednesday late afternoon in the Rose Garden, Trump listed various countries from around the world and the tariffs they charge on US products, saying, 바카라For decades, our country has been looted, pillaged, raped, and plundered by nations near and far, both friends and foes alike. American steelworkers, autoworkers, farmers, and skilled craftsmen바카라 they really suffered gravely. They watched in anguish as foreign leaders stole our jobs. Foreign cheaters ransacked our factories, and foreign scavengers tore apart our once-beautiful American dream.바카라
As he announced the tariffs, Trump held up a chart showing the tariffs that countries such as India, China, the European Union, Japan, Taiwan, South Korea, Bangladesh, Sri Lanka, and Pakistan levy on US products and the reciprocal levies that these countries will now have to pay.
바카라바카라while World Trade Organisation (WTO) members agreed to bind their tariff rates on a most-favoured-nation (MFN) basis, and thereby provide their best tariff rates to all WTO members, they did not agree to bind their tariff rates at similarly low levels or to apply tariff rates on a reciprocal basis.
바카라Consequently, according to the WTO, the United States has among the lowest simple average MFN tariff rates in the world at 3.3 per cent, while many of our key trading partners like Brazil (11.2 per cent), China (7.5 per cent), the European Union (EU) (5 per cent), India (17 per cent), and Vietnam (9.4 per cent) have simple average MFN tariff rates that are significantly higher,바카라 the executive order stated.
바카라For example, the United States imposes a 2.5 per cent tariff on passenger vehicle imports (with internal combustion engines), while the European Union (10 per cent), India (70 per cent), and China (15 per cent) impose much higher duties on the same product. For network switches and routers, the United States imposes a 0 per cent tariff, but for similar products, India (10 per cent) levies a higher rate.
바카라Brazil (18 per cent) and Indonesia (30 per cent) impose a higher tariff on ethanol than does the United States (2.5 per cent). For rice in the husk, the US MFN tariff is 2.7 per cent (ad valorem equivalent), while India (80 per cent), Malaysia (40 per cent), and Turkey (an average of 31 per cent) impose higher rates. Apples enter the United States duty-free, but not so in Turkey (60.3 per cent) and India (50 per cent),바카라 the executive order stated.
It added that these average MFN tariff rates conceal much larger discrepancies across economies in tariff rates applied to particular products.
The executive order stated that Trump finds that 바카라underlying conditions, including a lack of reciprocity in our bilateral trade relationships, disparate tariff rates and non-tariff barriers, and US trading partners바카라 economic policies that suppress domestic wages and consumption, as indicated by large and persistent annual US goods trade deficits, constitute an unusual and extraordinary threat to the national security and economy of the United States.
바카라That threat has its source in whole or substantial part outside the United States in the domestic economic policies of key trading partners and structural imbalances in the global trading system. I hereby declare a national emergency with respect to this threat,바카라 Trump said in the order.
The executive order notes that despite a commitment to the principle of reciprocity, the trading relationship between the United States and its trading partners has become 바카라highly unbalanced, particularly in recent years.바카라
바카라The post-war international economic system was based upon three incorrect assumptions: first, that if the United States led the world in liberalising tariff and non-tariff barriers, the rest of the world would follow; second, that such liberalisation would ultimately result in more economic convergence and increased domestic consumption among US trading partners converging towards the share in the United States; and third, that as a result, the United States would not accrue large and persistent goods trade deficits.바카라
What Are Reciprocal Tariffs?
In international trade terms, tariffs or customs duties or taxes are imposed on the import of goods. The importer has to pay this duty to the government. Normally, companies pass on these taxes to end users.
For example, if a company is importing a product 'X', having 10 per cent customs duty, valued at Rs 100 from other country, the cost of the product will go up to Rs 110.
These duties, which are indirect taxes, are a source of revenue for a country.The reciprocation of tariffs are imposed by countries to match hike in duties or high tariffs by trading partners. For example when in 2018, the US imposed higher duties on certain steel and aluminium products, India retaliated by raising tariffs on 29 US products, recovering equivalent revenue.
The US is facing huge trade imbalances with countries, especially with China. With India, the US has a trade deficit of USD 35.31 billion in goods in 2023-24. To bridge this gap, the US President is imposing these duties.
