Donald Trump raises India tax issue, threatens reciprocal tax upon returning to power

Washington, August 21: Former US President Donald Trump, who is vying for another term in office, has reignited the discourse on India's substantial taxation on specific American products, particularly Harley-Davidson motorcycles. He has now issued a warning of instituting a corresponding tariff if elected to the presidency in the 2024 elections.

During his initial tenure as the US president, Trump famously labeled India as a "tariff king." In May 2019, he took action by ending India's preferential market access under the Generalised System of Preferences (GSP) framework. He accused India of not providing equitable and reasonable market access to the United States.

In an interview with Larry Kudlow of Fox Business News, Trump voiced strong criticism regarding India's tax rates, which he claimed were unduly high.

Discussing the matter, Trump remarked, "The other thing I want to have is a matching tax where, if India charges us... India is very big with tariffs. I mean, I saw it with Harley-Davidson. I was saying, how do you do in a place like India? Oh, no good sir. Why? They have 100 per cent and 150 per cent and 200 per cent tariffs," the former president stated.

He continued, "So, I said, so they can sell their Indian motorbike. They actually make a bike, an Indian motorbike. They can sell that into our country with no tax, no tariff, but when you make a Harley, when you send it over there... because they were doing no business. I said, how come you don't do business with India? The tariff is so high that nobody wants it. But what they want us to do is, they want us to go over and build a plant, and then you have no tariff."

Highlighting the complexities of trade, Trump recalled his interactions with policymakers: "They said, well, that's not good. That's not our deal, OK? That's not our deal. And I came down very hard on them. But India is very big. Brazil is very big on tariffs, I mean, very, very big."

Trump posed a series of hypothetical scenarios in the context of trade negotiations, illustrating his viewpoint on the matter: "If India is charging us 200 per cent, and we're charging them nothing for products, can we charge them 100 per cent? No, sir, that's not free trade. Can we charge them 50 per cent? No, sir. Twenty-five, 10, anything? No. I said, what the hell is wrong? There's something wrong. You know what I'm talking about."

Concluding with his stance on reciprocal trade measures, Trump stated, "If India is charging us too, so what I want to have is a... call it retribution. You could call it whatever you want. If they are charging us, we charge them."

As Trump's political ambitions continue to shape discussions on international trade and economic policies, his recent remarks underscore the complex dynamics of global trade relationships.