Here's why Trump is wrong about India being a 'tariff abuser'

US President announcement on 100% tariff has more politics than economics

US President Donald Trump’s animus towards countries that he believes impose over 100 percent tariff on American imports is more politics than sound economics. A Moneycontrol analysis shows that just about 0.4 percent of the US’ non-oil exports attract over 60 percent duty.

In his address to US Congress, Trump said his reciprocal tariff plan will kick in from April 2 to ensure “fair trade”. He said the US has been ripped off by nearly every country and picked on India as well, saying "India charges us auto tariffs higher than 100 percent."

Moneycontrol found that of the $1.88 trillion worth of American non-oil exports to 155 countries, 100 percent or more tariff was levied on just 0.14 percent of its products.

Of the 155 countries that the US traded with between 2022 and 2023, just about 92 charged tariffs of 60 percent or more on American goods. Even among them, only $7.3 billion worth of US exports attracted tariffs of over 60 percent.

“Other countries have used tariffs against us for decades and now it’s our turn to start using them against those other countries,” he said in his first joint address to the Congress on March 4.  “On average, the European Union, China, Brazil, India, Mexico and Canada — have you heard of them? And countless other nations charge us tremendously higher tariffs than we charge them.”

He followed it up with India’s over 100 percent tariff claims. In the past, too, Trump has called India a tariff abuser and a difficult place to do business in.

In its recent Budget, India reduced customs duty on products to 70 percent or below, eliminating tariff lines of 100, 125 and 150 percent.

The MC analysis shows that in terms of the value of US products, India may not be the worst offender.

Of the over $7-billion US exports that were taxed at over 60 percent, 68 percent of these goods headed to South Korea, Canada and Mexico.

Japan and Thailand ranked fourth and fifth in tariffs on US goods. India ranked ninth after Guatemala, China and the Dominican Republic. Seventy-five percent of the goods traded by the US in 2023 attracted less than 5 percent tariff.