India hits back US for tariff hike, raises import duty on certain American products
India has raised customs duty on several goods, including Bengal gram, lentils, steel and aluminum, imported from the US. The import duty hike would be effective from August 4, the Finance ministry said in a notification. The move was in retaliation to the duty hike by the US on certain steel and aluminum products which had tariff implication of USD 241 million on India. The duty hike by India would have an equivalent tariff implications for the US.
Last week, India had submitted to the WTO a revised list of 30 items on which it proposed to raise customs duties by up to 50 per cent. Sources said out of 30 items proposed, India has "excluded motorbikes above 800 cc. Now additional customs duties have been imposed on 29 items."
Key items India increased import duty on:
The import duty on chickpeas and Bengal gram has been increased to 60 per cent, while that on lentils has been hiked to 30 per cent. The duty on boric acid and binders for foundry moulds has been hiked to 7.5 per cent, while that on domestic reagents was raised to 10 per cent. Duty on artemia, a kind of shrimp, has been hiked to 15 per cent.
The other products on which duties have been hiked include certain kind of nuts, iron and steel products, apples, pears, flat rolled products of stainless steel, other alloy steel, tube and pipe fittings, and screws, bolts and rivets. However, there was no duty hike on motorcycles imported from the US.
India-US trade tiff
On March 9, US President Donald Trump imposed heavy tariffs on imported steel and aluminum items, a move that has sparked fears of a global trade war. India has said the duty imposed by the US has affected steel exports by USD 198.6 million and aluminum shipments by USD 42.4 million.
India has also dragged the US to the World Trade Organisation's (WTO) dispute settlement mechanism over the imposition of import duties on steel and aluminum. India exports steel and aluminum products worth about USD 1.5 billion to the US every year.
India's exports to the US in 2016-17 stood at USD 42.21 billion, while imports were USD 22.3 billion.
The latest trade tariff hikes by the US and India comes days after the two countries agreed to hold a bilateral talk to sort out the issues.
Commerce and Industry Minister Suresh Prabhu, who recently met with US Commerce Secretary Wilbur Ross and US Trade Representative Robert Lighthizer during two-day visit to Washington DC, had announced that India and the US have agreed to hold official-level comprehensive talks to address trade and economic issues.
India has sought an exemption from the US tariffs along the lines the US has allowed to the European Union, Argentina, Australia, Brazil, Canada, Mexico and South Korea.
Prabhu had earlier said that India would bilaterally take up the issue of recent trade protectionism measures with the US.
"Every great partnership has areas of agreement and disagreement. I am hopeful that the US investment corridor is only going to grow, and I'm confident that we will be able to bridge our gaps," he said.
Earlier this week, at a press conference during the G7 Summit in Quebec, the US President accused India of levying 100 per cent tariff on some American products. Trump also threatened he would limit market access to the US and even cut off trade ties if America's trading partners did not cooperate.
(With inputs from agencies)
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