As he signed orders imposing stiff and sweeping new tariffs on imported steel and aluminium, US President Donald Trump today appeared to be hardening his stance on China, with which America has an annual trade deficit of nearly USD 500 billion.
Trump also pitched for the "reciprocal tax" programme, which, he says, would ensure "fair trade deals" for the US. Trump doesn't hesitate naming India while talking about the reciprocal tax.
The US President mentioned China several times in his speech in the Roosevelt Room of the White House at a ceremony wherein he signed two proclamations to impose 25 per cent and 10 per cent import duties on steel and aluminium respectively.
"China says it's got two per cent, but it sends much more. We're going to have a great relationship, hopefully, with China, but we have to do something. We're losing with China USD 500 billion a year. We have to do something," Trump told reporters during the signing ceremony.
Trump said the US is going to stop the trans-shipping.
"Well, we'll let it happen, but they've got to pay. So trans-shipping, frankly, is a big deal," he said.
"And they trans-ship, and we're going to accept their product, but it's going to cost a lot of money from the standpoint of the trans-shipper," he added.
The US, he said, is negotiating now with China.
"We're in the midst of a big negotiation. I don't know that anything is going to come of it. They have been very helpful. President Xi, I have great respect for. A lot of respect," he said.
"But we're going to cut down the deficits one way or the other. We have a deficit with China of at least USD 500 billion. When you add intellectual property, it's much higher than that," Trump said.
He then referred to a tweet from Tesla chief Elan Musk.
"Very interesting, I saw a tweet, just came in from Elon Musk who's using our wonderful space facilities and did a great job three weeks ago. He said, 'For example, an American car going to China pays 25 per cent import duty. But a Chinese car coming to the United States only pays 2.5 per cent. A tenfold difference'," the US President said.
"So an American car going to China pays 25 per cent import duty. We send our car over there, pay 25 per cent. They send their car over here, 2.5 per cent. Ten points. But everybody knows it, they've known it for years. They never did anything about it. It's got to change," Trump said as he once again raked up the issue of high import duty on Harley-Davidson motorcycles by India.
"We're going to be doing a reciprocal tax program at some point, so that if China's going to charge us 25 per cent or if India's going to charge us 75 per cent, and we charge them nothing. If they're at 50 or they're at 75 or they're at 25, we're going to be at those same numbers," he said.
"So, they charge us 50, we charge them 50. Right now, they'll charge us 50, we charge them nothing. Doesn't work. So that's called a "reciprocal tax," or "mirror tax." And we're going to be doing a lot of that," he added.
China, which ranks 11 among the largest sources of US steel imports, cautioned yesterday that it was prepared to "make an appropriate and necessary response" should the United States impose the tariffs.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)