India's Long-Expected Retaliatory Tariffs Against US Took Effect June 16

India’s decision to impose retaliatory tariffs on U.S. goods was expected by most of the U.S. business community, which has been preparing for the announcement for months, said Amy Hariani, vice president of the U.S.-India Business Council at the U.S. Chamber of Commerce.

India’s announcement was largely viewed as a direct response to the Trump administration's June 5 decision to remove India from the Generalized System of Preferences benefits program (see 1905310071). But it was also an announcement that had long been in the pipeline. India had repeatedly delayed retaliatory tariffs on certain U.S. agricultural products -- dating back to May 2018 -- that were aimed at offsetting the $241 million in duties India expected its U.S. customers to pay on its steel and aluminum exports.

India issued a notification to the World Trade Organization in May 2018 detailing the goods that would be subjected to additional tariffs (see 1805180064). India later issued a revised list in June 2018 that included dried chickpeas, lentils, various kinds of nuts, apples, golf carts, motorcycles, certain steel products, screws and bolts, and phosphoric and boric acid. India’s Ministry of Finance issued a June 15 circular that announced the tariffs would take effect June 16, and amended the tariff rates for three products: almonds, apples and phosphoric acid.

“The impacted products and industries have been well aware that this has been a potential outcome,” Hariani said. “It wasn’t super surprising.” While Hariani said the council has not yet heard feedback about how drastically the tariffs will affect U.S. exporters, she urged both India and the U.S. to reconvene and negotiate a deal. “Let’s not let these little trade irritants get in the way of the bigger picture,” she said. “We need to redouble our efforts and come back to the table.”