India recently reduced import duties on motorcycles, lowering tariffs on large bikes above 1,600cc from 50% to 30% and on smaller ones from 50% to 40%. This move aims to facilitate the entry of Harley Davidsons into India and potentially prevent tariff threats. The US exported $3 million worth of motorcycles to India last year.
President Donald Trump has reignited trade disputes by imposing measures on neighboring countries, allies, and notably China. The question remains whether India's tariff cuts will appease Trump or if trade actions are still imminent.
Ajay Srivastava, founder of Global Trade Research Institute, points out, Canada and Mexico are literally two arms of the US. If he has acted against them, he could easily act against India too.
While Trump had criticized India's high tariffs in the past, recent reductions could enhance US exports across various sectors, according to Mr. Srivastava. India's diverse exports include textiles, pharmaceuticals, engineering goods, petroleum oils, and more, showcasing its significant role in global trade.
As India has oscillated between protectionism and opening up since the 1990s, tariffs have risen again under Modi's "Make in India" initiative. While overlooking issues like agricultural market access may strain US-India trade relations, factors like strategic alliances and personal rapport between Modi and Trump could potentially mitigate trade disputes.