Donald Trump¡¯s reciprocal tariffs hit India¡ªfootwear, seafood, gold likely to face hike; netizens say, ¡®goodwill rarely pays off in global trade¡¯

On April 2, US President Donald Trump will roll out a plan to impose reciprocal tariffs on imports from foreign countries. This aggressive stance, which Trump has described as ¡°Liberation Day,¡± is part of his broader agenda to make America less dependent on foreign goods and industries. By targeting countries that have higher tariffs on US products, Trump aims to level the playing field for American businesses. As India is one of the major countries affected by these tariffs, the situation has raised several questions about the impact on the Indian economy, trade relations, and the future of global commerce.

What are reciprocal tariffs?

Reciprocal tariffs are a trade measure that matches the tariffs imposed by other countries on US goods. For example, if India charges higher duties on American products, Trump plans to apply similar tariffs to goods imported from India into the United States. The idea is to pressurize other countries into reducing their tariffs on US imports by hitting them with equivalent duties. Trump¡¯s rationale is that this approach would protect American industries, generate revenue for the government, and force other nations to negotiate fairer trade terms.

While Trump has been vocal about the benefits of tariffs, economists have raised concerns. Broad tariffs could lead to higher prices for consumers, potentially damaging the US economy. Moreover, global businesses could face rising costs, leading to decreased trade and hurtful consequences for the economies of both large and smaller players alike.

Trump¡¯s tariff impact on India

For India, the announcement of reciprocal tariffs could mean a significant shift in trade relations with the United States. India has already been dealing with rising tensions over tariffs, particularly on steel and aluminum, and this new move threatens to further strain economic ties. The US and India are negotiating a bilateral trade deal, but without clear indications of tariff exemptions, these talks may become more complicated.

Experts state that India could face higher duties on its exports to the US, including textiles, engineering products, and agricultural goods. While the US might state that the move is necessary for fairness in trade, India¡¯s exporters could bear the brunt of this decision. In addition, India might retaliate by imposing tariffs on American products, leading to a further escalation in the trade war. Such a scenario could hurt smaller economies like India, which may struggle to counterbalance the might of the US economy.

From seafood to footwear, sectors face heavy blow

India¡¯s exports are set to take a significant hit as Donald Trump¡¯s reciprocal tariffs come into effect. Dairy products, with a trade value of $181.49 million, will suffer from a 38.23% tariff differential, making ghee, butter, and milk powder more expensive and less competitive in the US market. The seafood sector, especially shrimp exports worth $2.58 billion, will face a 27.83% tariff hike, affecting India¡¯s dominant position. Similarly, live animals and animal products worth $10.31 million will see a 27.75% tariff burden. Processed food, sugar, and cocoa, amounting to $1.03 billion in exports, will also become pricier due to a 24.99% tariff hike. The footwear industry, already facing competition, will now deal with a 15.56% tariff rise, making Indian shoes costlier. Diamonds, gold, and silver exports, valued at $11.88 billion, will attract a 13.32% tariff, raising jewellery prices and reducing demand. Industrial goods, including pharmaceuticals, will see a 10.90% tariff increase, impacting the affordability of generic medicines. Edible oils like coconut and mustard oil will also become costlier due to a 10.67% tariff.

What to expect from Trump's tariffs?

Trump's tariffs are set to cover a wide range of products, including oil, gas, automobiles, and steel, with some sectors like autos facing a hefty 25% tariff. The total revenue from these duties is expected to raise around $100 billion for the US government. Other countries, including India, could find themselves forced into a trade war with the US. The risk of rising prices for consumers and businesses alike looms large, as tariffs often lead to higher import costs. This, in turn, might increase the cost of living, putting pressure on both global and local economies.

While the long-term effects of Trump¡¯s tariffs are still uncertain, the immediate consequences could be harsh. Businesses that rely on international trade may face higher operational costs, leading to reduced profitability and a potential slowdown in global growth. The global markets could experience further volatility as a result of these new measures.

Netizens are divided

Social media reactions to Trump¡¯s new tariff policy have been diverse, showcasing the range of perspectives on the issue. One user expressed excitement over the new tariffs, stating: ¡°Excited to see President Trump¡¯s announcement of reciprocal tariffs in the Rose Garden, accompanied by a strong team of advisors! Let¡¯s make America great again!¡± This comment shows the enthusiasm among some supporters of the President who believe that these measures will strengthen America¡¯s economic position.

Excited to see President Trump's announcement of reciprocal tariffs in the Rose Garden, accompanied by a strong team of advisors! Let's make America great again!

¡ª Aletha Munder (@AlethaMund77540) April 1, 2025

However, another user raised concerns about the fairness of the policy, suggesting that India and other countries, including China, have long imposed tariffs on US goods. The user posted, ¡°Aren¡¯t nations like China and India guilty of following tariff and non-tariff policy skewness in their trade? Why do we expect a perennial shoulder to lean on? Why can¡¯t we stand straight and say, ¡®We are game for equality of tariff¡¯?¡±

Is Trump justified in proposing a reciprocal tariff regime on imports? The stereotyped and expected answer is "He intends to rip off the less resilient economies of the world."
But ask yourself, " Aren't nations like China and India guilty of following tariff and non-tariff¡­

¡ª Ravi K Pillai (@ravi_k9) April 1, 2025

On the other hand, a third user voiced frustration over India¡¯s past concessions, pointing out that Trump¡¯s tariff measures are simply a reflection of every country¡¯s self-interest. ¡°Honestly, India¡¯s been bending backwards trying to keep the US happy, expecting some solid gains. But when it comes to trade, every country looks after its own interests first. Tariff wars end up hurting everyone, mostly smaller players like us.¡±

Honestly, India's been bending backwards trying to keep the US happy, expecting some solid gains.

But when it comes to trade, every country looks after its own interests first¡ªTrump is doing exactly that.

Tariff wars end up hurting everyone, mostly smaller players like us who¡­

¡ª CA Tapan Doshi (SEBI Registered RA) (@tapydoshi) April 1, 2025

Trump¡¯s reciprocal tariffs are a bold and controversial move aimed at reasserting America¡¯s dominance in global trade. While the US government may see these tariffs as a way to protect American industries, the repercussions for countries like India could be significant.

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