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The global market has been rattled by the Trump administration’s sweeping tariff announcements. Wall Street witnessed sharp declines, with major indices suffering losses of 5-6%, marking April 4 the worst trading day since the COVID-19 market crash in 2020.
While the US government views these measures as a step toward trade restructuring, businesses and investors are grappling with uncertainty.
There is no indication yet that US President Donald Trump or his team are willing to dilute or delay the proposed tariffs. While they remain open to negotiations, they are not seeking quick compromises.
The US is not merely pushing for tariff parity; instead, it is aiming for a broader restructuring of global trade, with a focus on structural and non-tariff barriers. Even if a deal is reached, the administration insists that the new tariff base rate will remain at a minimum of 10%, with room for negotiation only beyond that threshold.
The key document guiding this policy is the 2025 Trade Estimate Report from the US Trade Representative (USTR). This 400-page report details trade barriers country by country and serves as the foundation for how and when negotiations will be initiated.
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The USTR is expected to submit a detailed report to the US Congress, clarifying the specifics of the executive order. Meanwhile, the Council of Economic Affairs is set to provide guidance on how the new tariff rates have been calculated.
Notably, these tariffs are not purely reciprocal; for instance, while the calculated US tariff rate on Indian imports stands at 52%, India’s tariffs—including VAT and other duties—do not reach that level.
A critical concern ahead is whether US Customs and Border Protection can effectively implement these new tariffs without causing port delays or major disruptions to supply chains. Businesses worldwide will be closely monitoring these operational challenges over the coming weeks.
reactions to Trump’s tariff move have been measured so far. While several countries have expressed disappointment and concern, most have stopped short of announcing retaliatory measures. For now, many governments appear to be keeping the door open for negotiations. However, this stance could change quickly if trade tensions escalate further.
One day after Trump’s tariff move, the message from his administration is clear—this is about long-term leverage, not short-term concessions.
While negotiations may eventually take place, the US has set a high bar for any potential discussions. The global market now waits to see how businesses and governments respond to these sweeping changes in trade policy.
Also Read | US Tariffs: The ripple effect on India’s economy — a holistic analysis
First Published:
Apr 4, 2025 2:09 PM
IST
