Trump's New Tariff Strategy: What It Means for India and China

Trump Announces New Tariff Rates

Washington: On Wednesday, President Donald Trump revealed a new tariff strategy, introducing a reduced rate of 10% for a period of 90 days for countries that have not imposed retaliatory tariffs on U.S. goods, including India. In contrast, he raised tariffs on China to a staggering 125% following their retaliatory measures.

India has refrained from responding to Trump's 26% tariff and is currently in discussions with the U.S. administration, similar to around 70 other nations.

During a recent meeting, Indian External Affairs Minister S. Jaishankar and U.S. Secretary of State Marco Rubio talked about the importance of swiftly concluding a bilateral trade agreement.

The decision to pause and increase tariffs on China came after Beijing retaliated against Trump's previous 50% tariff hike, which had already raised their total tariffs to 104%. In response, China increased its tariffs on American imports to 84%.

President Trump expressed his frustration with China on Truth Social, stating, "Due to the disrespect shown by China towards global markets, I am raising the tariff on China to 125%, effective immediately."

He further noted that over 75 countries have reached out to U.S. representatives to negotiate trade issues, and since these nations have not retaliated, he has authorized a 90-day pause with a significantly reduced reciprocal tariff of 10%, effective immediately.

The U.S. markets have experienced volatility since these tariffs were implemented, prompting calls from influential figures like Bill Ackman for a temporary halt.

Additionally, Trump has faced criticism regarding the tariffs from key advisor Elon Musk, who has publicly disagreed with the measures, leading to a dispute with Peter Navarro, another prominent trade advisor.