Trump's 'Liberation Day' tariffs to hit all nations starting April 2

Trump confirms global rollout of 'Liberation Day' tariffs from April 2, sparking concern over trade wars; India considers lowering import duties to avoid impact

US President Donald Trump confirmed on Sunday that his “Liberation Day” tariff plan will begin with “all countries”, brushing aside speculation that he might initially limit its scope to fewer nations when the tariffs are unveiled on April 2.

 

According to a Bloomberg report, talking to reporters, he said, “You’d start with all countries. Essentially all of the countries that we’re talking about. So let’s see what happens.” He added, “I haven’t heard a rumour about 15 countries, 10 or 15.” 

 

“We’re going to be much nicer than they were to us, but it’s substantial money for the country,” Trump said.

   

The confusion over the scope of tariffs arose after White House economic adviser Kevin Hassett recently told Fox Business that the administration would target 10 to 15 countries with the most significant trade imbalances, although he did not specify which countries.

 

Set to launch on April 2, “Liberation Day” marks the introduction of Trump’s reciprocal tariffs, a strategy that he says is key for rebalancing global trade, equalising the tariffs that other nations impose on the US, boosting US manufacturing, and generating tariff revenue to fund his domestic policy goals like financing the tax cuts and fulfilling additional tax promises made during the 2024 campaign.

 

Trump has already implemented 25 per cent tariffs on aluminium, steel, and autos, while also raising tariffs on all imports from China.

 

However, the clarity on the implementation of tariffs, rate calculation, and measures countries can take to gain exemptions is yet to be unveiled. Trump has indicated that the new tariffs will factor in non-tariff trade restrictions like regulations and licences imposed by other nations, but has not clarified how those calculations will be made. Additionally, the White House has not provided a timeline for when the tariffs will take full effect.  ALSO READ | Ahead of April 2 tariffs deadline, Trump aides unsure 'what boss will do'

 

Liberation Day tariffs and impact on India

 

According to media reports, there are concerns about a trade war globally, including in India, that are impacting markets. Trump has repeatedly called out the country for its high import duties on the US. He has called India the global “tariff king” on multiple occasions. India’s average tariff rate on imports from the US is 17 per cent, according to media reports, which is significantly higher than the US average of 3.3 per cent.

 

Ratings agency S&P Global Ratings has recently warned that Trump’s higher tariffs could pose a big threat to some Asia-Pacific economies, including India. The S&P analysis on the impact of tariffs found that India, South Korea, and Thailand could be the most vulnerable.

 

As the April 2 deadline approaches, the Indian government is considering reducing tariffs on a significant portion of US imports in order to mitigate the impact of Trump’s tariffs on India’s exports, which were about $33.4 billion to the US in April–December 2024, according to the Ministry of Commerce and Industry. The government has initiated discussions with the US and proposed focusing on a bilateral trade agreement to address import duty concerns. Assistant US Trade Representative for South and Central Asia Brendan Lynch was in India from March 26–29 to discuss the bilateral trade agreement. However, the joint statement issued on Saturday after the talks did not mention reciprocal tariffs.  ALSO READ | Liberation day: How should Indian firms and policymakers respond?

 

Export sectors on edge

 

Export-dependent sectors such as steel, aluminium, pharmaceuticals, textiles and electronics may face adverse impacts from the new tariffs. The US is among India’s top export destinations, and the new measures could hit revenue streams for several large firms.