Piyush Goyal shrugs off impact of Trump’s import tariff proposal

India looked at the U.S. as one of the ‘most reliable trade partners’ and ;outstanding’ trade partner, says Union Commerce Minister Piyush Goyal.

Union Commerce and Industry Minister Piyush Goyal has said that India-U.S. trade relations would not be impacted by former U.S. President and Republican presidential candidate Donald Trump proposing a  universal 20% import tariff for goods coming into the U.S., suggesting that it was campaign rhetoric.

Also read: ‘India not an ‘abuser’ of tariffs, Trump’s claims unfair,’ says think tank GTRI

 “I don’t think comments made during an election determine our relations,” Mr. Goyal said, during a press conference on Thursday evening in Washington DC towards the end of his three day visit to the U.S.

Mr Trump has proposed a universal 20% tariff on imports into the U.S., with a higher rate of 60-100% on Chinese imports.

The Modi government had had good relations with the administrations of Joe Biden, Donald Trump and Barack Obama and that things were getting progressively better, the Union Minister said.

Mr. Trump , during a campaign event on September 18, had described India as “very tough” and a  “big abuser” in the US-India trade context.

Mr. Goyal said that India looked at the U.S. as one of the “most reliable trade partners” and “outstanding” trade partner, with whom trade was expanding in every dimension.

“And we deeply value this relationship,” he said.

Defends India’s tariff regime

Mr. Goyal, defended India’s tariff regime in reference  to remarks made by  former  Trump administration US Trade Representative (USTR) Bob Lighthizer. The official had in his 2023 book praised Mr. Goyal but called India “the most protectionist country”.

Mr. Goyal responded to this on Thursday (October 3, 2024) saying that every country protects certain goods based on its national interest and based on the offensive action of certain other countries. The U.S., he said, had an import tariff rate of some 163% on peanut butter, to protect its farmers.

Mr. Goyal said that in a world of MFN (Most Favoured Nation) duties, one had to look at which countries were dumping  products in India , presumably referring to China, among  other countries.

The minister said since the MFN rate applied to all countries (i.e., the 166 countries that operate under World Trade Organisation rules), so free trade agreements were the work-around to these rates.

“The MFN rate applies to all, and some countries may find it hurting them. The best way forward is for us to do a free trade agreement, and that is what India is doing with many countries,” he said, adding that this was the only way for a country to have differential tax rates with its trade partners.

“Bob [ Lighthizer ] understands that very well,” Mr. Goyal said, adding that if India were to lower tariffs on certain goods for the benefit of the U.S, a third country might receive the benefit.

Published - October 04, 2024 08:23 am IST