The Trump administration’s tariffs have had a significant economic impact on India and other BRICS countries, but the international diplomatic and political effects remain difficult to measure. The central issue is China, which has been one of America’s top three trading partners, and how China fares compared to India. The White House seems headed toward more lenient treatment for Beijing on tariff rates and other metrics than it imposed on New Delhi.
India’s tariff rate was announced as 26%, 1 point lower than originally proposed on Apr. 2, but a major increase from the previous average rate of 2.4%. Trump has also criticized India’s acquisition of Russian military equipment and Indian purchases of Russian oil and gas in violation of America’s Ukraine-related sanctions. Indians were surprised and angered by the relative harshness of India’s treatment and the threat of additional penalties if Washington and New Delhi could not quickly strike a deal.
Geopolitically, China and its emerging Russia alliance are this century’s principle strategic threat to the U.S. and its allies. Many analysts believe Trump could offer significant concessions on key security issues, such as Taiwan, to get a China deal. Beijing’s strengthening alliance with Moscow has resulted in significantly increased Chinese purchases of hydrocarbons, negotiations to build new oil and gas pipelines between the two, and increased financial and military cooperation.
