Former US President Donald Trump’s recent claim that India is an "abuser" of import tariffs is "unfair," according to the Global Trade Research Initiative (GTRI), which argued on Friday that many countries, including the United States, protect their domestic industries with high customs duties on certain products.
Citing the World Trade Organization’s 'World Tariff Profiles 2023', GTRI noted that the US imposes substantial tariffs on various goods, such as dairy products (188%), fruits and vegetables (132%), cereals and food preparations (193%), and beverages and tobacco (150%).
“These figures show that the US also safeguards specific sectors of its economy through high tariffs,” GTRI said in its report.
The think tank pointed out that while India does impose high tariffs on certain items, such as wines and automobiles, this does not represent the overall tariff structure.
"Trump's argument singles out products with the highest tariffs while neglecting the average and trade-weighted tariffs that better reflect India's trade policy," GTRI founder Ajay Srivastava said.
On 17 September, Trump called India an "abuser" of import tariffs, echoing a similar statement from October 2020, when he labelled India the "Tariff King."
Srivastava argued that Trump’s statement lacks essential context, as many countries impose significant tariffs to protect their domestic industries. India’s average tariff rate of 17% is higher than the US’s 3.3%, but comparable to other major economies, such as South Korea (13.4%) and China (7.5%).
India has also shown a willingness to engage in free trade by removing customs duties on imports from countries with which it has free trade agreements, such as ASEAN members, Japan, and South Korea, the GTRI said.
However, Srivastava highlighted that the US has been reluctant to reduce tariffs through FTAs. "This reluctance is evident in the Indo-Pacific Economic Framework, where no tariff cuts were included, reflecting the US's cautious approach," he added.
Srivastava suggested that if the US seeks zero-tariff access to the Indian market, it should negotiate a free trade agreement with India.
He also noted that Trump’s focus on specific high-tariff products does not reflect the broader reality. "On 24 January 2019, Trump pointed to India’s 150% import tariff on US whiskey. While India does charge high tariffs on items like whiskey and automobiles (100-125%), it is not unique in doing so,” GTRI said.
Many countries impose high tariffs on a few products, such as Japan (457%), South Korea (887%), and the US (350%), GTRI said.
Srivastava explained that high tariffs are often used to protect specific domestic industries. "Japan may protect its rice farmers, the US its tobacco farmers, and India its wine industry. However, these high tariffs do not represent the rates at which most trade occurs. Average tariffs and trade-weighted tariffs better reflect a country’s overall tariff profile," he added.
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