Donald Trump threatens reciprocal tariffs on Indian products, says India 'charges a lot'

US President-elect Donald Trump on Tuesday reiterated his intention to impose reciprocal tariffs on India as a retaliatory measure against what he described as high tariffs on the import of certain American products. Responding to a question on a potential trade agreement with China, Trump alleged that India and Brazil were among the countries that impose high tariffs on certain US products.

“Reciprocal. If they tax us, we tax them the same amount. They tax us. We tax them. And they tax us. Almost in all cases, they're taxing us, and we haven't been taxing them,” Trump said at a news conference at Mar-a-Lago.

Trump made the remarks while responding to a question on a potential trade agreement with China.

Stressing the word ‘reciprocal’, the US President-elect said, “...If India charges us 100 per cent, do we charge them nothing for the same? You know, they send in a bicycle and we send them a bicycle. They charge us 100 and 200. India charges a lot. Brazil charges a lot. If they want to charge us, that's fine, but we're going to charge them the same thing.”

Trump has long criticised India over trade, referring to the country as the “Tariff King” during his 2020 campaign.

In the second successful run-up to the White House, Trump had made it clear that ‘reciprocity’ would be the most important element of his administration to “make America extraordinarily wealthy again.”

“It's a word that's very important in my plan because we generally don't charge tariffs. I started that process, it was so great, with the vans and the small trucks, etc,” he said in October.

The US is the largest trading partner of India in 2023-24. India's exports stood at USD 77.51 billion, while imports aggregated at USD 42.2 billion in the last fiscal.

During April-October this fiscal, the country's exports to America rose by 6.31 per cent to USD 47.24 billion, while imports grew by 2.46 per cent to USD 26 billion.

Between FY 2020 and FY 2024, India's merchandise exports to America rose by 46 per cent from USD 53.1 billion to USD 77.5 billion.

Imports from the US also grew to USD 42.2 billion last fiscal from USD 35.8 billion in 2019-20.

On the other hand, trade in services between the two nations expanded 30.3 per cent from USD 54.1 billion in 2018 to an estimated USD 70.5 billion in 2024.

India is also a key destination for American businesses such as professional, scientific, and technical services, manufacturing, and IT. Washington is the third largest investor. India received USD 66.7 billion of FDI inflow between April 2000 and June 2024.