India Unmoved by Trump’s Steel Tariffs and Economic Moves
As President Donald Trump ramps up his protectionist agenda with a sweeping 25% tariff on all steel and aluminium imports into the U.S., India’s response has been one of calculated silence. This latest trade move by the U.S. President, announced just days before Prime Minister Narendra Modi’s scheduled visit to Washington, adds to a series of previous shocks to India’s economic interests.
Despite the significant impact of these measures on global trade, the Indian government has remained largely unperturbed in its public statements, offering muted reactions to the escalating tensions. In his announcement, Trump emphasized that there would be “no exemptions” to the tariffs, effective from March 4, reinforcing his broader vision of revitalizing U.S. industries. “It’s time for our great industries to come back to America…this is the first of many,” Trump declared, implying further tariffs may be on the horizon. The implications of these moves are far-reaching, especially for countries that rely on the U.S. market, including India, which has a modest share of the U.S. steel import market. Union Steel Secretary Sandeep Poundrik responded with a composed stance, asserting that India’s exports of steel to the U.S. were negligible, amounting to just 95,000 tonnes last year—out of India’s total steel production of 145 million tonnes.
“So, how does it matter if you are not able to export 95,000 tonnes?” Poundrik quipped during an event hosted by the Bengal Chamber of Commerce and Industry. While this reflects India’s relatively low dependency on the U.S. for steel exports, there are potential concerns about broader trade repercussions, especially if other nations follow the U.S. lead with their own protectionist measures. The Indian steel sector has faced challenges in recent years, with increased competition and dampened pricing due to high steel imports into India. Experts, such as Hui Ting Sim, AVP at Moody’s Ratings, warn that the tariff increase will heighten competition in global steel markets and complicate the landscape for Indian producers. This, coupled with potential trade restrictions in other countries, could further undermine the profitability of India’s steel manufacturers.
India’s government, however, has yet to offer an official response to the U.S. decision to revoke India’s waiver for developing the Chabahar port in Iran, a key part of New Delhi’s international trade strategy. Additionally, Trump’s threats to impose 100% tariffs on BRICS nations if they attempt to sideline the U.S. dollar have remained unaddressed. India’s diplomatic silence also extends to the U.S.’s withdrawal from the Paris Climate Agreement and World Health Organization (WHO), with no official statements on the potential loss of U.S. funding for health and renewable energy projects. This cautious approach by the Indian government stands in stark contrast to Trump’s aggressive economic posture, leaving industry experts to speculate on India’s future economic strategies and its evolving relationship with the U.S. in the midst of these growing tensions.
