U.S. President-elect Donald Trump on Tuesday (December 17) reaffirmed his position on implementing reciprocal tariffs against countries imposing high duties on American goods. He specifically highlighted India and Brazil, reiterating past criticisms and signaling the potential for trade tensions when he returns to office in January.
On Monday, Trump stressed that if other countries impose taxes on U.S. products, the United States will reciprocate accordingly. He made the remarks in response to a question about a potential trade agreement with China.
“The word reciprocal is important because if somebody charges us, India, we don’t have to talk about our own, if India charges us 100 per cent, do we charge them nothing for the same? You know, they send in a bicycle and we send them a bicycle. They charge us 100 and 200,” Trump reportedly said during the news conference at Mar-a-Lago.
“India charges a lot. Brazil charges a lot. If they want to charge us, that’s fine, but we’re going to charge them the same thing.”
Trump’s Commerce Secretary pick Howard Lutnick recently said that reciprocity is bound to be the central subject when it comes to the upcoming Trump administration.
“How you treat us is how you should expect to be treated,” Lutnick said, echoing Trump’s stance.
Trump Hails India The ‘Tariff King’
Trump has previously referred to India as the “tariff king.” Indeed, India’s average tariff rates are significantly higher than those of the world’s largest economies and rank among the highest compared to other emerging markets.
Amid Trump’s stark warnings, Indian Finance Minister Nirmala Sitharaman said in November that she might consider rolling back increased tariffs on products that do not pose a threat to the domestic industry.
“I will lift tariffs on them provided it doesn’t, intended or unintended, hurt my own capacity to produce. I will have to balance the two,” she said at the time.
According to Sitharaman, she is responsible for protecting domestic companies that produce goods locally, while also balancing the needs of those reliant on imports.
India-US trade relations
The U.S. is India’s largest trade partner and primary export destination, making their trade relationship crucial. Additionally, the U.S. is India’s fourth-largest source of imported goods. In 2023-24, India imported $42.2 billion worth of goods from the U.S. and exported $77.52 billion to the U.S., making it India’s largest export destination.
Any disruption in this trade flow could have major economic repercussions for India, especially in key sectors such as IT, pharmaceuticals, and textiles. Moreover, the threat of tariffs could discourage American companies from investing in India, potentially affecting the country’s economic growth.
