China’s retaliatory tariffs on the United States are expected to make it difficult for the US to find new markets for at least a fourth of its exports to Beijing as it faces 84 percent duties, according to a Moneycontrol analysis.
While the US exported $148 billion worth of products to China in 2023, nearly $46 billion worth of exports were in categories where China had an over 20 percent share of US exports.
Further analysis shows that of these 281 items where China was the US’ major importer, 111 items were such where China was the largest importer of these goods across the world.
Washington’s merchandise exports to Beijing in these categories was nearly $35 billion.
Categories where US’ dependence on China is over 20 percent are largely concentrated in vegetables, chemicals, and machinery imports, which were worth $28 billion.
If Washington cannot find allies in Europe and its North American partners, Canada and Mexico, then it would find it difficult to get alternatives for at least $40 billion its trade to China.
The United States on April 9 paused the levy of differential reciprocal tariffs on countries, choosing to levy a flat duty of 10 percent except for China.
The US president increased the levy on Chinese goods to 125 percent, after Beijing announced retaliatory tariffs of 84 percent on US exports.
"Based on the lack of respect that China has shown to the World’s Markets, I am hereby raising the Tariff charged to China by the United States of America to 125%, effective immediately. At some point, hopefully in the near future, China will realize that the days of ripping off the U.S.A., and other Countries, is no longer sustainable or acceptable. Conversely, and based on the fact that more than 75 Countries have called Representatives of the United States, including the Departments of Commerce, Treasury, and the USTR, to negotiate a solution to the subjects being discussed relative to Trade, Trade Barriers, Tariffs, Currency Manipulation, and Non Monetary Tariffs, and that these Countries have not, at my strong suggestion, retaliated in any way, shape, or form against the United States, I have authorized a 90 day PAUSE, and a substantially lowered Reciprocal Tariff during this period, of 10%, also effective immediately," the US President said on Truth Social platfor, on Wednesday.
Can India help?
While India, which is negotiating a bilateral trade agreement with the US, can help divert some of the trade, its contribution would be marginal.
Analysis shows that India could only absorb another $3 billion of trade in these categories, over and above the $40 billion the country imports from the United States.
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