Indian exporters are breathing a sigh of relief after a recent US Supreme Court ruling against former President Trump’s tariffs. This 6-3 decision was a major setback for Trump’s trade policies, stating that he didn’t have the legal authority to impose such tariffs on imports.
In response to the ruling, Trump quickly introduced a new 10% global tariff. While this is part of his ongoing trade strategy, it raises questions about its longer-term effects.
Manoj Mishra, a partner at Grant Thornton Bharat, pointed out that Indian exporters will benefit immediately as they won’t face the previously planned 25% reciprocal tariff. Instead, he mentioned that even under a proposed Bilateral Trade Agreement (BTA), the tariff would have only been reduced to 18%. “This is good news for consumers in the US and exporters in India,” he said.
While the ruling helps reduce product costs in the US, thus benefiting Indian small and medium enterprises (SMEs), Mishra also noted a potential downside. He expressed concerns that India might lose the small edge it had with the BTA. Though the tariffs could ease costs for products like textiles, Mishra believes the long-term impact may still be challenging.
On the topic of refunds from the Trump-era tariffs, Mishra suggested it’s highly unlikely. He reasoned that the revenue from these tariffs has already been allocated, making it impractical for the US to issue refunds across the board.
Looking ahead, Mishra emphasized the need for India to engage in discussions with the US. He highlighted the importance of negotiating aspects of the BTA that impact Indian farmers, suggesting that these discussions are crucial for addressing sensitive agricultural issues.
In recent years, trade dynamics between the US and India have been influenced by various factors. For instance, a survey from the Pew Research Center found that more than 70% of Americans view India as a crucial partner. This relationship could play a role in shaping future trade agreements, especially as both countries navigate their economic strategies.
Ultimately, the recent Supreme Court ruling has opened a new chapter for India-US trade relations. While challenges remain, the immediate relief for Indian exporters marks a positive step forward.
For further insights, you can check the US Trade Representative’s website or reports from the World Trade Organization for more details on international tariffs and trade agreements.
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bilateral trade,import duties,Indian exporters,tariff reduction,Tariff relief,Trade strategy,US Supreme Court
