Economy - Politics

India Lodges Formal Complaint Against Trump With World Trade Organization, Plans Retaliatory Measures

Published on May 23, 2018 by Athena Pallas

Add India to the growing list of countries speaking out against President Trump’s steel and aluminum tariffs, calling them violations of guidelines from the World Trade Organization (WTO). Trump believes he can skirt WTO rules by claiming the tariffs are for national security reasons, which is hardly believable relating to countries that are clearly our allies, like the countries of the EU, Canada, Mexico, and India as well. The EU, Canada and Mexico have all been given what appear to be temporary reprieves in Trump imposing the metal tariffs, pending a permanent decision in less than a month for the EU and pending the outcome of NAFTA negotiations for Canada and Mexico. Trump clearly is using the potential imposition of tariffs as a bargaining chip in an effort to strong arm countries into complying with his will.

Now India, seeing it as unlikely that they will receive an exemption on the tariffs, has lodged a formal complaint with the WTO and has announced retaliatory tariffs it plans to impose on the United States if Trump does not give India an exemption. According to CNBC:

India has launched a complaint against the United States to challenge U.S. President Donald Trump’s tariffs on steel and aluminum, a filing published by the World Trade Organization showed on Wednesday. Indian officials told Reuters last month that their government would open a WTO dispute if the country’s firms were not granted an exemption…India’s retaliation claim seeks to recoup a cost of $31 million levied on its aluminum exports and $134 million on steel, and it has said it could target U.S. exports of soya oil, palmolein and cashew nuts in its retaliation. Its latest legal challenge seeks to force the United States to scrap the tariffs entirely…Under WTO rules, the United States has 60 days to settle the complaint, after which India could ask the WTO to set up an expert panel to adjudicate.

India joins the European Union, China, Russia, Japan, and Turkey in disputing President Trump’s claim that the metals tariffs are justified for national security reasons and therefore the countries believe they are owed a combined $3.5 billion annually in compensation from the United States based on Trump’s violations of WTO rules. According to CNBC:

In its complaint, India listed a string of ways the U.S. tariffs violated the WTO rules and unfairly damaged India’s interests. It said they broke the WTO’s safeguards agreement and the United States was trying to use its tariffs to get other countries to agree to “voluntary export restraints.” The United States had also exceeded the maximum import tariff allowed by the WTO and the tariffs were not applied uniformly to steel and aluminum imports from all suppliers, breaking a core principle of the WTO rulebook.

India joins many countries in objecting to Trump’s tariffs. Of course there are many objections within the United States as well, as both farmers and manufacturers have encouraged Trump to drop the tariffs out of concerns for rising prices and retaliatory tariffs on U.S. exports. Trump’s tariff threats have also led to multiple significant drops in the stock market as well. All off this has created a tremendous amount of uncertainty, both economically (for the U.S. and the world) and diplomatically, as our allies grow increasingly alienated by Trump’s unilateral actions and threats.

Featured image by Gage Skidmore via Wikimedia Commons.