The Many Ways America First Hurts Global Trade

When he visits Washington tomorrow, Narendra Modi would need to bank on the excellent personal relationship he enjoys with Donald Trump to stave off possibilities of higher tariffs on more exports from India.

- BISWAJIT DHAR

Last week, Trump announced plans to impose 'reciprocal tariffs' on many countries, with indications that India could be in the crosshairs. This week, he imposed across-the-board tariffs on steel and aluminum imports that affect India too; but it's not targeted at India alone.

The announcements signal a major escalation of Trump's strategy to dismantle the existing trade order and reshape relationships in keeping with his 'America First' policy. It supports the unilateral use of trade policy instruments to protect the "American economy, the American worker, and national security interests". It disregards the principles of fair play that form the basis of the multilaterally agreed rules for the orderly conduct of global trade. The intent of the new US administration is hardly surprising, as Trump has underlined that "the most important element of [his] plan to make America extraordinarily wealthy again is reciprocity".

The first set of tariffs was announced last month against three countries-Canada, Mexico and China. Though the implementation of a 25 percent tariff hike for the US's two neighbors was postponed by a month, the 10 percent hike on China is being levied.