Trade tiff between the US and India set to escalate

Trade tiff between the US and India set to escalate


When the issue revolves around a whopping sum of $ 560 million, it ceases to be a matter of routine and instead reflects serious repercussions if not addressed effectively.

The trade war between the United States and India seems to be in for some escalation in view of recent developments. When the US President, Donald Trump invited Prime Minister Narendra Modi and other officials and discussed the same, matters seem inclined to head the way of a disaster. If the recent policy shifts by the US administration are anything to go by, this is exactly what is happening.

Since the last half-century, goods exported from India to the US were waived from tax burdens. But now, it seems that the Trump administration is reversing the trend and seeking to impose new taxes on goods coming in from India. The mainstream media in the Gulf is also lending focus to the issue, publicizing it a front page news.

US retail giants like Amazon and Flipkart have invested over $ 20 billion in India over the next eight years. It is the tax impositions that have been levied on them that has apparently triggered the US action. Flipkart is particularly in the limelight as it is under the retail umbrella of Walmart.

A fluctuation in the present export policy could deal a lethal blow to India. Speculations are rife that PM Modi may withdraw the tax impositions as a response to the aggressive stance by the Americans. The US administration has earlier tried to riffle China with the gimmick of imposing huge taxes, but the ploy apparently did not work with the feisty Asian giant.

However, the world is watching with a keen eye if India will buckle under the pressure of the threats issued by the Americans. Without the exploration and establishment of new and emerging markets, our farmers, industrialists and goods will have a massive dark cloud looming over them. It remains to be seen if the Indian government will take a prudent stance in context of the same.