Trump in India and special trade status
Leaders meet amid Trade War and Increased Expectations of the US
President Trump has the habit of calling world leaders as their friends. The list is too long, but this friendship claim also brings a fight. Mr. Trump, in the election year, is more interested in sticking to his manifesto. Make America Great Again! It is the reason why he has opened fronts with many countries that suit the United States only by removing special trade status for many countries. However, it has led the world economy into uncertainty. Currently, he wants to nail down the truce with China over the trade war. He terms Xi Jinping, his friend, amid the trade war. It may be the case here in India, where Mr. Trump has reached to meet Modi.
Modi and Trump have some good experiences and events to remember. They shake hands warmly and pose to be very frank. You can remember the body language during a procession in the United States during the annual UN General Assembly meeting. But things are not simple like this. India and the United States have some trade war like context the same as with China.
Trump’s Removal of Special Trade Status for India
In June last year, President Trump shocked India by removing its special trade status. It was not difficult to understand because the Trump administration believed that India does not provide equitable and reasonable access to its markets. It was true as well because India acts as a powerful country when it meets with world powers. At the same time, it acts like a developing country that requires rebates and concessions. It is a confusing situation for India after removing special trade status.
They are taking our jobs. China is taking our jobs. Japan is taking our jobs. India is taking our jobs. It is not going to happen anymore, folks!
Trump knew how to deal with it, and he responded to the removal of special trade status for India. As a result, India could not enjoy exemptions on its products from US tariffs. Critics took this step as opening a new front because, at that time, Trump was aggressively behaving with China over trade talks. Commonly, we know it’s the US-China trade war. But this decision from Trump had a response from India too, and it shows Trump India’s trade status.
India hit the United States with More Tariffs
India is considered a global engine for growth, along with China. It responded immediately after the decision of removing special trade status. It simply increased tariffs on US exports to the country. It added further difficulties and uncertainties in global trade that was hurt by the US-China trade war at that time. Products and commodities chosen for increased tariffs included American apples, lentils, almonds, and many chemical products.
It is worth to note that the Indian government did not impose increased tariffs only to the June 2019 action by the Trump administration. India and the United States were having a series of trade talks over the last year. The US imposed import duties on steel and aluminum from India, and the Indian government wanted to increase tariffs.
Increased Expectations of the US
In a statement from the United States, President Trump would raise the issue of minorities in India. Not clearly, but the statement has hinted that he would raise the Kashmir issue as well. However, the issue of minorities in India is very serious these days. The country has been facing a series of protests against the citizenship amendment bill. It shows high expectations of Trump from this visit. It has been noted by analysts that there is nothing much about the trade from this visit. It may prove a visit for the sake of the visit.
Therefore, it would be much interesting to assess the outcomes of this visit. Whether both countries would calm down in the context of the trade warlike situation behind the scenes, and they would step back. It is early to predict what the consequences of this visit may be.