U.S. President Donald Trump has issued a warning regarding the possible implementation of an additional 10% tariff on India in the context of its participation in the BRICS group. This poses challenges for India as it seeks to finalize a trade agreement with Washington.
Trump's Warning and Its Implications
Trump made his remarks on Tuesday, just a day after claiming he was close to finalizing the trade agreement with India. The president indicated that India could face additional levies along with other BRICS members. This statement followed a two-day BRICS summit in Brazil where leaders condemned 'trade-distorting tariffs.'
India’s Position on BRICS and the Dollar
Officials in New Delhi stated they were not overly concerned about Trump's threats. They noted that the U.S. perception that BRICS aims to weaken the dollar does not align with India's goals. Senior diplomat P. Kumaran mentioned in a press briefing that there was no discussion about the tariff threat during Modi's state visit to Brazil.
Prospects of the Trade Agreement
Over the years, the U.S. has cultivated its relationship with India as a key strategic partner. The development of the trade agreement is crucial for restoring these ties. It is expected that the trade deal will be finalized by the fall. Some observers believe Trump's new tariff threat may be a tactic to extract more concessions from New Delhi.
Thus, the situation regarding the trade agreement between India and the U.S. remains tense due to Trump's warnings, casting doubt on the parties' readiness to finalize the deal.
