Trump’s Heavy Metal Tariffs: Why India Won’t Be Affected

Top White House economic advisor Gary D Cohn has resigned from US President Donald Trump’s administration today, due to Trump’s decision of imposing heavy tariff on all steel and aluminum imports to the US. Trump has put a charge of 25 percent on steel and a charge of 10 per cent on Aluminum, shipment of these metals into the United States.

However, White House has insisted there is no one single cause for Cohen to joining the list of early bird retirees from the Trump Administration.

“When a country (USA) is losing many billions of dollars in trade with virtually every country it does business with, trade wars are good, and easy to win. Example, when we are down $100 billion with a certain country and they get cute, don’t trade anymore-we win big. It’s easy,” Trump tweeted.

Impact on India

These tariffs imposed on steel and aluminum by Trump will not have a large or considerable impact on India. India is only of the top 4 producers of steel worldwide but exports less than 10 per cent to the US. 

In the financial year 2016-17, India just exported over Rs 10,600 cr of Iron and steel to the US.

As per HSBC reports, India only accounts for 2 per cent of steel imports for the United States. 

According to a Morgan and Stanley report, India’s steel exports to the US, represent less than 1 per cent of the total steel produced in India and only 4 per cent of India’s steel exports.

As per data from the Indian government, India only accounts for 5 per cent of global primary aluminum steel production. In 2016-17, India exported only Rs 2,346 cr of Aluminum and its products to the US.

India Trade Tango with the US 

Statically India ranks ninth on the list of trading partners that run a trade surplus with the U.S. India exports more to the U.S. than what it imports. China, Mexico, and Japan lead the list and even Vietnam runs a higher surplus against the U.S. than India does, as per the data from  U.S. government.

U.S.-India Trade In 2017

Indo-US Trade Rank- 9

Indian Exports to the US : $25.7 billion

India’s Imports from US : $48.6 billion

Indo-US Total Trade: $74.3 billion

Percent of India in total trade: 1.9 percent