US trade dragon or chicken? Why India should strike a tough bargain with Trump
Initially, nations appeased Trump’s trade tactics, but China’s firm stance proved more effective. Trump’s ‘reciprocal tariffs’ faced market crashes and legal challenges, earning him the nickname ‘TACO.’ As the 90-day tariff pause nears its end, India should remain firm in negotiations too.
When US President Trump announced high ‘reciprocal tariffs’ against all trade partners on April 2, the world panicked. Most countries — including India to some extent — opted to pacify a rampaging Trump with soft tones and concessions. That now looks like a mistake.
China stood up and raised its tariffs by 125% when Trump did so. This trumped Trump. US treasury secretary Scott Bessent soon admitted that ultra-high tariffs were unsustainable. Trump waived these for negotiations to start. Apart from raising tariffs, China countered with restrictions on exports of rare earths and permanent magnets needed by top US industries including autos.
