When people talk about World War 3 happening, they didn’t realize it would be in the form of a global trade war that threatened to impact the world’s economies.
So far, we’ve extensively covered President Trump and his attempts to gain fairer trade and the retaliation of China and Europe, but now India is jumping into the fight as well.
This week, India has announced retaliatory tariffs of their own on 30 U.S. products ranging anywhere from apples and almonds to metals and chemicals. These tariffs total around $241 million, which is on par with what India is expected to lose once Trump’s tariff on steel and aluminum goes into effect.
India also plans to increase its already large tariff on U.S. motorcycles like Harley Davidson, an issue Trump has complained about in the past. It seems unfair that countries can have tariffs on U.S. products, but if the U.S. sets a tariff, it’s met with retaliation, so the move speaks volumes.
These new rounds of tariffs are due to take effect on June 21st and India says they’re open to adding more if necessary.
“India reserves the right to adjust the specific products for which [tariffs would apply], and its right to adjust the additional rate of duty imposed on such products,” they said in a filing to the World Trade Organization.
Currently, the deficit of trade between the U.S. and India sits at $30.8 billion with India getting the advantage. These tariffs are an attempt by the Trump administration for the U.S. to cut the trade deficits that happen worldwide, but our allies won’t have it, which means that the storm clouds are gathering over further economic prosperity worldwide.
Last week, we reported China’s move since a 25% tariff was slapped on Chinese products and Canada’s frustration with the U.S. as well.
The U.S. implementing tariffs to recoup money lost in trade deals seems like a fair deal, but with countries worldwide promising to retaliate (and refusing to back down), industry all across the board will suffer.
If the cost of these products goes up, then that means jobs will be cut and economic production within these industries will slow to a crawl. Losing jobs, especially in recently-hit sectors like the auto industry, would stop the unprecedented growth we’ve seen in recent months.
One can only hope that this situation gets taken care of before a global trade war goes too far and hurts everyone in the process.