The Morning Brief Tariffs Trump Trade
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Apr 4, 2025 Bishajit Dhar, a trade policy expert and Professor at Jawaharlal Nehru University, delves into the recent wave of tariffs announced by President Trump. He discusses the chaotic impact on global markets, particularly for India's auto, textiles, and electronics sectors. Dhar critiques the strategic use of tariffs and examines how India can navigate these challenges amid competitive pressures from countries like China and Vietnam. He emphasizes the need for India to bolster domestic industries and adapt its trade strategies during this turbulent time.
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Trump's Tariff Strategy
- Trump's tariff plan, influenced by Stephen Mirren's report, aims to revive American industry by using tariffs to generate revenue.
- High tariffs can be leveraged to negotiate better market access in partner countries like India.
Tariff Negotiation Tactic
- Experts see the ambiguous tariff structure as a short-term negotiating tactic within a larger trade play.
- Trump's opening move is unsustainable due to inflationary pressures and potential for a US recession.
Ambiguous Tariffs on India
- The executive order imposing tariffs contains ambiguities, creating confusion about the actual percentage levied on India.
- While initially reported as 26%, it was later revealed to be 27% on top of a 10% base duty for all countries.