India (Commonwealth) _ According to Indian government officials, the US move to raise duties on a variety of Chinese goods shows that “no country is willing to put all their eggs in one basket post-Covid-19 pandemic.” According to reports, India is also adhering to a strategy to guarantee that the nation has the capacity to manufacture electric cars (EVs) on a local level. The policy is good, so there’s no reason to be concerned.
On Tuesday, US President Joe Biden announced significant tariff increases on several Chinese goods, including solar cells, EV batteries, EVs, semiconductors, and medical supplies including face masks, gloves, syringes, and needles.
Sources stated that any nation would like not to rely on a single foreign supplier, especially where mobility is involved, and that the US is pursuing strategies to reduce its reliance on China, especially in the battery manufacturing industry. They mentioned that “India is also building manufacturing capacity.”
According to a report by the economic think tank GTRI, China may be forced to dump these goods in other markets, like as India, as a result of the US boosting tariffs on EVs, batteries, and many other modern technology items. It stated, “This is a time for India’s Directorate General of Trade Remedies (DGTR) to exercise caution.”
However, official sources stated that while the DGTR will investigate any anti-dumping concerns, they are now only theoretical. The GTRI report also made clear that India has some export potential due to the higher taxes on Chinese face masks, syringes, needles, medical gloves, and natural graphite. For India, this change offers a huge opportunity. India might expand its trade footprint in the US market by increasing the production and export of these in-demand items, the report stated.
However, as India is a net importer of these goods, it could not have any export advantage on the other goods, such as semiconductors and EVs. The additional tariffs, however, are another blow to supply chains as they work to control continuing risks and strengthen resilience, according to a report from Moody’s released on Wednesday. “The effects of every tariff hike, irrespective of the justification,
Impact on businesses and customers extends beyond cost hikes, according to Moody’s Senior Director of Supply Chain Strategy John Donigian. The US exported $148 billion in exports and bought $427 billion worth of goods from China in 2023.
According to a senior official, India has institutions and procedures in place to prevent such inflows, so the nation is not concerned about the possibility of China dumping more goods in India in the wake of the US decision to impose higher penal duties on certain Chinese products, including electric vehicles (EVs).
“The Directorate General of Trade Remedies, or DGTR, is our system. Our anti-dumping technique works well. We thus have every institutional instrument to investigate the possibility of someone dumping products in India. We’ll address it appropriately,” a government representative stated.
When a nation sells products to another nation at a price less than what it charges on its own domestic market, this is referred to as “dumping.” WTO regulations prohibit it because it damages the domestic industry of the importing nation.
US President Joe Biden imposed steep tariffs on China earlier this week, targeting vital industries including semiconductors, electric cars, batteries, solar cells, ship-to-shore cranes, medical supplies, steel, and aluminum.
“American companies and workers are at risk due to China’s unfair trade policies on technology transfer, intellectual property, and innovation. China is also dumping unfairly cheap exports into international markets.
According to a White House statement, President Biden is ordering the Trade Representative to raise tariffs under Section 301 of the Trade Act of 1974 on $18 billion of imports from China in response to China’s unfair trade practices and to offset the harms that result. This is done to protect American businesses and workers.
According to the new regulation, Section 301 will see a rise in the tariff rate from 25% to 100% in 2024 for electric cars and from 25% to 50% in 2025 for semiconductors. The EU and the US are reducing their imports of electric vehicles from China. Higher taxes (placed by the US) on Chinese exports create a huge opportunity for India, as the GTRI analysis also noted. These are prospects that Indian exporters might concentrate on. India may expand commerce in the US market by increasing production and exports of certain in-demand goods.
