President Trump\u2019s \u201cAmerica First\u201d trade policy is creating history, and also repeating history, in a flagrant violation of the norms laid by the World Trade Organization (WTO) by imposing aggressive unilateral sanctions against US\u2019s partner countries. This has led to reciprocal sanctions and a trade war, which economists say will not benefit any country. But President Trump thinks that the US\u2019s own trade rules will put \u201cthe American economy, the American worker, and US national security first,\u201d.\u00a0 President Trump\u2019s strategies for the revival of US manufacturing to \u201cMake<\/p>\n
America Great Again\u201d are a repetition of the protectionist policies of<\/p>\n
President Herbert Hoover which increased the economic crisis following the stock market crash in 1929 and led to the \u201cGreat Depression.\u201d<\/p>\n
It is a highly painful reminder of the economic misery that trade protectionism can bring to the global economy. President Hoover imposed the Smoot-Hawley Tariff Act of 1930, which effectively raised tariffs by 40%\u201360%.\u00a0 On top of the Stock Market crash of 1929, this huge traffic wall attracted reciprocal tariffs from the country\u2019s trade partners, just as they are happening now. Tariffs interfered with the market mechanism by raising prices, purchases decreased and in a negative circle, the global economy plunged into depression. US imports fell by 49%, while the US share of world exports fell from 15.6% in 1929 to 12.4% in 1932.<\/p>\n
But,What is driving the USA today? One is to conclude bilateral trade agreements with nations which could benefit the USA, implying a trade surplus or balanced trade at most and unilateral tariff raise against countries with which the USA has constant trade deficits like China. So far \u201cReciprocal tariffs\u201d of varying rates have been imposed upon, China (Trade Surplus of $300 bn with the USA), Canada (Trade Surplus of over $150 bn), Mexico (Trade Surplus of $200 bn) India (Trade Surplus of $40bn) and EU (Trade Surplus of Euro 157 bn). Because of the retaliatory measures from Canada, China and Mexico, US GDP is projected to reduce by 0.3-0.4% and over 400,000 job losses, a major reason which brought back the Republicans in power.<\/p>\n
Realizing the potential of India, it seems that the USA is keen on a Bilateral Trade Arrangement (BTA) with us and Reciprocal Tariffs are the first step to achieve the same. But, BTA under what terms? Will we be able to protect our small farmers from unfair business, as the US is keen on India\u2019s agro market? Will our Services and Manufacturing Sector continue to grow? What are your thoughts?<\/p>\n","protected":false},"excerpt":{"rendered":"
President Trump\u2019s \u201cAmerica First\u201d trade policy is creating history, and also repeating history, in a flagrant violation of the norms…<\/p>\n","protected":false},"author":1,"featured_media":666,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-665","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-government-policies-and-regulations"],"post_mailing_queue_ids":[],"_links":{"self":[{"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=\/wp\/v2\/posts\/665","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=665"}],"version-history":[{"count":1,"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=\/wp\/v2\/posts\/665\/revisions"}],"predecessor-version":[{"id":667,"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=\/wp\/v2\/posts\/665\/revisions\/667"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=\/wp\/v2\/media\/666"}],"wp:attachment":[{"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=665"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=665"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blogs.indianchamber.org\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=665"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}