Uncertainty in global trade got new lease of life with US President Trump insisting on weaponzing tariffs with no signs of easing down K.A.Badarinath

President Donald Trump is going bonkers. Tariffs or weapons of mass destruction, it makes no difference to him or the Republican White House that he runs. It’s with the same vigour that deadly arms to different parts of the world are supplied or sold, tariffs slapped or reviewed.

In one of my earlier write ups, I did say that Donald Trump would be one of the ‘biggest disruptor’ of global order, be it geo-political, economic and trade relations. This has been proved beyond doubt in recent days.

US Supreme Court order of last week may have been just a few hours of pause on weaponised tariffs that’s central to Donald Trump’s economic policy formulation. In those few hours, he switched statutes, juggled acts, related provisions and then slapped 15 per cent import tariffs on each and every country that America trades with, be it an ally or a foe.

Well, reciprocal tariff regime of President Trump under his emergency economic powers may have ended. But then, he opened another line to slap tariffs for 150 days pending approval from US Congress.

Even as new tariff regime comes into operation beginning Tuesday that are over and above most favoured nations (MFN) duties, uncertainty in global trade continues to reign supreme with nations’ capital across seven seas trying to make sense of the new tariffs, their future and what’s in store for each one of them.

By weaponizing tariffs to force both allies and enemies alike into submission, Donald Trump opened a new untested model of building relationships. In the process, President Trump has addressed his domestic white core political constituency who perceive him as a ‘decisive leader’ who’s just going about his job of governing America.

From provisions relating to balance of payments, discrimination against American interests to several substantive clauses of Trade Acts in US may be invoked by President Trump to carry forward what he describes as part of his campaign to Make America Great Again (MAGA).

President Trump is going gaga to leave his imprint on America’s governance come what may. He shows no signs of backing off any time now. But, what essentially happens is that period of uncertainty would extend, most countries will use this timeframe to recalibrate to redefine their negotiation strategy.

While China is better off as it secured one-year negotiation time to sign upon a new trade deal, Bharat has kept its options open and may need more fresh air in the room before a pact is clinched with Washington DC.

Now, the proposed 18 per cent reciprocal duty to be part of free trade agreement with US becomes infructuous as use of International Economic Emergency powers have been struck down by US Supreme Court. Fresh negotiations for a deal between Bharat and US seem inevitable at much below 18 per cent impost though President Trump continues to insist that nothing has changed for Bharat. Postponing current round of negotiations on FTA for a later date would work well for both India and US as Washington DC.

Secondly, keeping all options open would work in best interest of Bharat and its 1.4 billion citizens. Reworking the entire deal with US

in totem over next six months is not a bad idea with ‘strategic autonomy’ being central to engagement. In this context, taking a common approach on US tariffs with like-minded partners as suggested by Brazilian President Luiz Inacio Lula da Silva may be explored. Building blocks or unions against America may not be an option for Bharat though the visiting President Lula has postulated such a strategy.

Similarly, putting a full stop to purchase of oil and gas from Russia cannot be an option as Bharat continues to diversify its energy basket, sources and undertakes rework of energy matrix.

Diversifying its markets for selling its goods and services beyond European Union should be seriously considered by Bharat’s negotiators. Speciality minerals deal with Brazil is a fine example like the ‘strategic relations’ entered into France is unique and specific to Bharat.

Similarly, arriving at a working understanding with China be seriously considered notwithstanding the aggressions, transgressions made by the people’s liberation army on the borders. Containing border conflicts, China giving up its falsified claims in Indo-Pacific should be integral to the working arrangement with Beijing.

Thirdly, Bharat should aggressively play the role of a peacenik in conflict between Russia and Ukraine, Israel & Iran apart from taking an aggressive ‘zero tolerance’ posture against radicalism, religious terror and overseas interferences on the sly.

Fourthly, achieving a fine balance in our global engagement in the medium to long term to safeguard Bharat’s security interests that are non-negotiable should be the objective.

Republican or Democratic White House is no patronizing friend of Bharat. Bharat must safeguard her own interests.

END OF ARTICLE