The Indian Ministry of Finance announced this Saturday that it was going to increase tariffs on a slew of goods imported from the U.S. as a reaction to the U.S. withdrawing its trade benefits earlier this month.
The list of goods to suffer these retaliatory duties imposed by the Indian Government includes apples, walnuts, almonds, lentils, and a number of chemical products. The Indian authorities haven’t specified the value of the affected goods on this occasion. However, they had formerly communicated to the World Trade Organization that the goods in question are worth roughly $241 million.
Last year, the exchange of goods and services between the U.S. and India amounted to $142 billion.
India’s decision to raise import duties on said products was made public on Saturday, and it came into effect the next day, leaving the U.S. no room for negotiation.
New Delhi had first threatened to hike the tariffs on U.S. goods in June 2018, after Washington refused to absolve it from increased steel and aluminum tariffs. India hadn’t acted on it, though, since the two countries had been engaged in a series of trade talks.
However, when the Trump administration removed India from the preferential trade program on June 5, the relationship between the world’s first and sixth largest economy tightened.
Until then, India was the largest beneficiary of the program, known as the Generalized System of Preferences (GSP) which eliminates duties on goods imported from the U.S. for developing countries.
With India off of the list of designed GSP beneficiaries, it will be obliged to pay tariffs on approximately $6 billion worth of goods. The Indian Government had deemed the event “unfortunate” in a statement issued on Saturday, vowing to advocate for their country’s best interests.
India dealt a serious blow to the U.S. in a fight for those interests. According to the U.S. Department of Agriculture, in 2018, India purchased $543 million worth of almonds grown in the U.S. and $156 million worth of apples. This made India the biggest importer of almonds by a wide margin, as well as the second biggest importer of apples.
With a visit to India scheduled for later this month, U.S. Secretary of State Mike Pompeo says he is open to the idea of dialogue as a method of resolving the trade dispute with India.