THE United States said last Wednesday (14) it was taking action at the World Trade Organisation (WTO) against Indian export subsidies as Washington’s intensifying trade offensive moved to encompass two of Asia’s largest economies.
The action opened a new front in president Donald Trump’s confrontations with major trading partners and followed his punishing new import tariffs, with officials warning that more may come soon.
In advance of the announcement on Indian exports, Trump tweeted early last Wednesday that the United States could not “keep a blind eye to the rampant unfair practices against our country!”
Documents seen also revealed the US has proposed WTO reforms that would punish members for violating basic rules, a move that appeared aimed squarely at China – a country the Trump administration has said is not a market economy and does not deserve membership in the multilateral organisation.
US trade representative Robert Lighthizer said in a statement that Indian export subsidy programmes “harm American workers by creating an uneven playing field on which they must compete.” “USTR will continue to hold our trading partners accountable by vigorously enforcing US rights under our trade agreements and by promoting fair and reciprocal trade through all available tools, including the WTO.”
According to Lighthizer’s office, India offers benefits valued at $7 billion annually to domestic exporters such as duty, tax and fee exemptions – including support for producers of steel, pharmaceuticals, chemicals, information technology products and textiles.
In 2016, the US ran a $30.8 billion trade deficit with India in goods and services, according to Lighthizer’s office.
In last Wednesday’s statement, the office said India had expanded its export subsidy programmes, doubling the number of products eligible under one program to 8,000 in the last three years.
Trump has said publicly he does not favor resorting to dispute resolutions at the WTO, where he claims the United States is at a disadvantage. And the administration has instead focused so far on tariffs and remedies under domestic US law.