Trump sees tariffs as multipurpose tools. Sometimes as a means to an end—as negotiating leverage to cut a deal. And, other times it is to encourage re-shoring American manufacturing and to generate revenues to pay for tax cuts and spending.
Trump 1.0 is evidence that his bark is worse than his bite.
The good news is that with election fever in the US over, and having won the presidential election, Trump is now a wee bit sober, as per ET. Thus, the actual damage would likely be less than what experts have been forecasting.
In a recent press interview, Trump mentioned that his government will impose a 10% tariff on Chinese goods, a sixth of the lowest level he threatened during the campaign.
Chinese producers may choose to absorb a certain proportion of the expected tariff rather than risk losing their share of US exports to other countries.
Trump hates trade deficits and his focus is on countries that have a high trade deficit with the US. India is not among the top exporters to the US. It is 10th on the list in terms of trade deficit. Rest assured, Trump will try to bully India. But, hopefully, India won’t be on the top of his list.
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