Similar to U.S. President Donald Trump’s threatened 25% tariffs on Japanese imports, his 50% tariffs on Indian imports, which took effect on Wednesday, will likely come down as U.S.-India trade negotiations progress.
Nevertheless, the Trump tariffs, and the substantial hit Indian manufacturing will take as a result, provide an opportunity for India to “pivot” toward Asia — to borrow a phrase from former U.S. President Barack Obama — and away from its overreliance on the U.S. as its most important export market.
Trump’s tariffs come at a time when Indian exports to the U.S. are growing rapidly, comprising 18% of all exports and 2.2% of the nation’s gross domestic product. Historically, India has never been a treaty ally of the U.S., but it has maintained a strong relationship with America. New Delhi’s ties with Washington became especially close during the presidencies of George W. Bush and Barack Obama, and they remained strong during Trump’s first term and continued under Joe Biden.
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