US 'America First' Policy: A New Wave of Tariffs and the Weaponization of Trade
UPSC Relevance
Prelims: Indian Economy (Foreign Trade, Tariffs, Protectionism vs. Free Trade); International Relations (India-US relations, World Trade Organization - WTO).
Mains:
General Studies Paper 2 (International Relations): Effect of policies and politics of developed and developing countries on India’s interests; Bilateral, regional and global groupings and agreements involving India.
General Studies Paper 3 (Economy): Indian Economy and issues relating to growth, development; Effects of liberalization on the economy.
Key Highlights from the News
US President Donald Trump announced a new round of punishing tariffs on various imported products.
Key New Tariffs:
Branded drugs 100%.
Heavy-duty trucks 25%.
The government states this measure is to prevent foreign products from "flooding" the American market and to protect manufacturers from unfair competition.
These tariffs are imposed citing national security ramifications, a legal avenue allowing the US to unilaterally impose tariffs.
The US uses tariffs as a key foreign policy tool to gain an upper hand in trade negotiations, pressure other countries, and for foreign policy objectives.
This move is likely to adversely affect export-dependent sectors such as India's pharmaceutical industry.
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