Tariffs and Turning Tides

India is diversifying aggressively—leveraging Africa, Latin America and Gulf partnerships to bypass U.S. tariffs and secure resilient new trade routes

- PRABHU DAYAL

Many American analysts opine that the Trump tariffs will hurt the U.S. In his piece, "Trump's Tariff Tantrums Are Hobbling the U.S. Economy," Jeffrey A. Sonnenfeld, Professor at Yale University, has stated that tariffs have fundamentally disrupted markets, leaving businesses vulnerable to the double threat of uncertainty and cost inflation.

John Mearsheimer, a leading American international relations expert and Professor at the University of Chicago, has said that the Trump administration's India policy is a "colossal blunder" and asserted that secondary tariffs on India for buying Russian oil "won't work." Trump's former National Security Adviser John Bolton has said that he "has shredded decades of efforts" made by the West to strengthen diplomatic and strategic ties with India with his "disastrous" tariffs.

The Washington Post summed up the position in its September 1 editorial: Trump's white-knuckling with India could backfire.

A majority of Americans are concerned about tariffs, fearing they will raise consumer prices and hurt the economy. Polls show disapproval, with many believing tariffs will cause inflation, damage businesses, and affect sectors like agriculture. While some view tariffs as boosting domestic manufacturing, these hopes are outweighed by concerns about rising costs. Even among Republicans, worries about inflation are high, though disapproval is stronger among Democrats and independents.

Concerns are also mounting because Trump has promised to impose hefty import taxes on pharmaceuticals, a category largely spared in his trade war. Diederik Stadig, a healthcare economist with ING, wrote that lower-income households and the elderly would feel the greatest impact. "A tariff would hurt consumers most of all," he noted, with both direct costs at pharmacies and indirect costs through higher insurance premiums.