Is India Really the 'Tariff King'?
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Synopsis
Former Indian Ambassador Mohan Kumar confronts the misleading narrative surrounding India's tariff rates, asserting that the reality is far more nuanced. In a world where trade dynamics are often misrepresented, his insights shed light on the complexities of tariff calculations and the implications for international trade relations.
Key Takeaways
- Mohan Kumar challenges the notion of India as a 'Tariff King'.
- Trade-weighted tariffs provide a more accurate representation than simple averages.
- India's trade-weighted tariff is 4.6%, compared to a simple average of 16%.
- High agricultural tariffs are essential for protecting Indian farmers.
- US exporters encounter lower tariffs in India compared to competitors.
Washington, Sep 4 (NationPress) Former Indian Ambassador to France and Director General of the Jadeja Motwani Institute for American Studies at OP Jindal Global University, Mohan Kumar, has challenged the Trump administration's claim that India is the 'Maharaja of tariffs'.
In a recent article published in Newsweek magazine titled 'Is India a 'Tariff King'? Not Really', Kumar described the notion of India's elevated tariff rates as 'widespread yet erroneous'.
He contended that the tariff conflict initiated by the US contradicts its obligations under World Trade Organisation (WTO) agreements, while admitting that the WTO has been 'inactive for some time'.
On Tuesday, US President Donald Trump reiterated his accusation that India's tariffs on US exports are 'among the highest globally'.
'India was imposing substantial tariffs, reportedly the highest in the world. Consequently, our business exchanges with India have been limited, although they engage with us because we are not charging them excessively,' he stated.
The former diplomat also sought to clarify a common misunderstanding regarding tariff calculations.
He argued that trade-weighted tariffs offer a more accurate representation than simple average tariffs because 'for the majority of goods entering the Indian market, the trade-weighted applied tariff is what truly matters'.
Kumar pointed out that India's trade-weighted tariff stands at a 'commendable 4.6 percent', compared to simple average tariffs nearing 16 percent.
He recognized that India imposes high tariffs on agriculture to safeguard its farmers and that US demands for opening India's agricultural sector would be 'akin to urging it to commit suicide, which no elected Indian government would consent to'.
He deemed these demands 'outrageous', given that Western farmers benefit from both direct and indirect subsidies.
Kumar also highlighted that, contrary to popular belief, US exporters encounter 'comparable or lower tariffs in India relative to several of their Asian counterparts'.
He emphasized the electronics and technology sectors, where the majority of imports incur zero percent tariffs, contrasting this with Vietnam's 8.5 percent and China's 5.4 to 20 percent tariffs.
Point of View
It is important to acknowledge that trade narratives often distort reality. The perspective provided by Mohan Kumar emphasizes the need for a comprehensive understanding of tariffs and their implications, ensuring that discussions around trade policies remain informed and constructive.
NationPress
04/09/2025
Frequently Asked Questions
What did Mohan Kumar say about India's tariffs?
Mohan Kumar refuted the claim that India is the 'Maharaja of tariffs', arguing that the perception of high tariffs is widespread yet erroneous, and highlighted the importance of trade-weighted tariffs as opposed to simple averages.
How does India’s trade-weighted tariff compare?
India's trade-weighted tariff is 4.6 percent, which is significantly lower than the simple average tariff of around 16 percent.
What is the implication of high agricultural tariffs in India?
Kumar stated that high agricultural tariffs are necessary to protect Indian farmers, and US demands to open this sector are unrealistic and detrimental.
How do US tariffs compare in India versus other countries?
According to Kumar, US exporters face equal or lower tariffs in India compared to many Asian countries, particularly in sectors like electronics.
What was Trump's assertion regarding India's tariffs?
Trump alleged that India imposes some of the highest tariffs on US exports, which Kumar argues is a misrepresentation of the actual trade dynamics.
