Washington, Apr 5: A top trade analyst has said the Trump administration’s calculations that led to the tariffs are “not standard economics” and in many cases impose rates far higher than those that the targeted countries apply to US goods.Julia Spies, chief of trade and market intelligence at the International Trade Center, said uncertainties remain about the exact way the US Trade Representative’s office and other US officials came up with the tariffs.
She said the figures presented by Trump roughly match the US trade balance — or imbalance — with a specific country, divided by imports from that country, “and that, divided by two, gives us the reciprocal tariff” imposed by the US.
“This is not standard economics,” Spies told reporters by video to a UN briefing in Geneva.
The US calculation included countries’ tariffs on American exports plus other regulations and policies in those countries, like currency manipulation, sanitary measures, and technical barriers to trade, and “all of that led to this – what they call tariffs’.”
The ITC, based in Geneva, is a joint agency of the United Nations and the World Trade Organisation that aims to help small businesses in the developing world to trade.
US tariffs provide Indian exporters with a competitive advantage over rival nations, said SC Ralhan, the President of the Federation of Indian Export Organisations (FIEO), adding that the movement is ‘quite favourable’.
The FIEO President expressed optimism about the impact of the tariffs on Indian exports, noting that while India faces a tariff of around 27 per cent, this remains manageable compared to the higher tariffs imposed on competing nations, particularly China.
The import tariffs imposed on peer Asian economies are more compared to the tariff rate of 27 per cent on India could be an advantage to us, he added.
“We have an advantage in that whatever the advantage China had with cheap raw materials, that advantage is gone. I think this is good,” Ralhan said, adding that Indian manufacturers have an opportunity to increase the trade share.
He further stated that industries in countries like Turkey would be more adversely affected, given the disparity in tariff rates. “Despite initial concerns, India’s position remains strong, and this presents a crucial opportunity for Indian exporters to enhance production quality and maintain consistency in supply. Orders from the US are expected to start flowing to India soon,” he added.
“This is a high time for the Indian exporters to increase their production quality,” he added. On the domestic front, Ralhan emphasised the need for government intervention to support Indian exporters. He urged policymakers to facilitate the modernisation of small- and large-scale industries by reducing tariffs on energy-efficient and high-productivity machinery imports.