Reciprocal tariffs will apply to all countries: US President Donald Trump

He, however, promises to be 'much more generous'

US President Donald Trump has said that the reciprocal tariffs, set to be announced on April 2,  will apply to “all countries” without exception, dashing hopes of any relief to India. The announcement comes even as both nations continue negotiations over tariff concessions under a proposed bilateral trade agreement (BTA).

 

“All countries… essentially all of the countries that we're talking about. There is not a cut off,” Trump told reporters aboard Air Force One on Sunday, denying reports that reciprocal tariffs will target a smaller group of 10-15 countries with the biggest trade imbalances with the US.

 

He, however, insisted the tariffs would  be “generous”. “We are going to be much nicer than they were to us,” he said.

 

 

Without naming India, Trump took aim at trade practices in Asia. “You go to certain places, you take a look at every single country in Asia, what they have done to the US in trade. I won’t say anybody has treated us fairly or nicely. But we are going to be much more generous to them.”  

 

A day earlier, Trump had described India’s tariffs as “brutal” but expressed confidence that trade relations between the two nations would “work out very well.”

 

The two countries have agreed to finalise the first tranche of a BTA by the fall of 2025. Official-level trade talks concluded on Saturday after four days of discussions, with both sides agreeing to begin sector-specific virtual engagements in the coming weeks.

 

A Barclays report last week estimated that $22 billion worth of India’s exports — accounting for 30 per cent of exports to the US and 5 per cent of total goods exports — are at risk from the new tariffs. “Given close trade ties, we expect India to adopt a conciliatory tone on select tariffs and also address some non-tariff barriers,” the report said.

 

So far, there is no clarity on how the reciprocal tariffs will be structured, making it difficult for countries to formulate a response.

 

Trade experts suggest the tariffs could be applied at a country-wide level on all imports, at a sectoral level targeting specific industries, or on individual products and commodities. Given the complexities involved in making these calculations, and the tight implementation timeline, broad country-wide tariffs could be the most straightforward option.

 

Barclays noted that India’s trade-weighted import tariff on American goods is around 10.5 per cent, significantly higher than the US’ corresponding tariff rate of 2.7 per cent. “The largest tariff differentials are on agricultural goods, automobiles and processed food (25-40 per cent). They are relatively lower for petroleum products, gems and jewellery, and electrical machinery and equipment,” it said.