Question

Find examples of tarriffs in TWO SEPARATE countries and explain why they have tariffs on this product (Agriculture would be the easiest)

(DO NOT use South Africa and Argentina)

Answer 1

India is "the worst" in terms of high tariffs on American products, a top American Senator claimed on Sunday, ahead of US President Donald Trump's crucial meeting with Prime Minister Narendra Modi on the sidelines of the G-7 Summit in France which is likely to be dominated by trade frictions between the two countries.When you look at the world tariff regime; 67 per cent of all the tariffs in the world disadvantage America. There's a higher tariff on American products in the country in which we do business with. India has raised tariffs on 28 items, including almond, pulses and walnut, exported from the US in retaliation to America's withdrawal of preferential access for Indian products.The Trump administration wants Prime Minister Modi to lower the trade barriers and embrace "fair and reciprocal" trade.Last February, India slashed the customs duty on imported motorcycles like Harley-Davidson to 50 per cent after Trump called it "unfair" and threatened to increase the tariff on import of Indian bikes to the US.India exports steel and aluminium products worth about USD 1.5 billion to the US every year. India's exports to the US in 2017-18 stood at USD 47.9 billion, while imports were at USD 26.7 billion. The trade balance is in favour of India.Tensions have since been rising between the two countries. Last year, India retaliated against US tariff hikes on aluminium and steel by raising its own import duties on a range of goods.President Trump has also threatened to impose sanctions if India purchases oil from Iran and if it goes ahead with plans to buy Russian S-400 anti-aircraft missiles.The latest tariffs from India come just days before country's Foreign Minister, Subrahmanyam Jaishankar, is due to meet his US counterpart, Mike Pompeo, at a G20 summit in Japan. Mr Trump and India's Prime Minister Narendra Modi are also expected to hold talks.The list of products considered for duty increase has 18 iron and steel items, which is seemingly a reply to US president Donald Trump’s tariff hikes in the sector.However, the government had dropped “motorcycles above 800cc” from the list. Despite India importing bikes worth only about $10 million in the category in 2017-18, Trump has continued to use a company (Harley Davidson) manufacturing such motorcycles as an instrument to attack India on market access issues.The dairy sector plays a pivotal role in aiding the reduction of rural poverty and inequity, in addition to ensuring the food security of millions of rural households. Notably, according to a report by the Agriculture Skill Council of India, while crop production generates employment for the rural workforce for an average of 90-120 days in a year; the dairy sector plays a major role in providing alternative employment opportunities throughout the year.In fact, in the recent years, milk and milk products have become the largest agricultural commodity, with their output standing at more than 20.6 per cent of the combined output of paddy, wheat and pulses. Thus, there is no gainsaying the importance of the dairy sector as one of the important sectors of the Indian economy.The underlying broad reasons behind India’s trade surplus with the US in dairy is elucidated as follows. First, a glance at the product-wise trade statistics from India reveals that ‘melted butter’ (ghee) has the largest share in exports to the US at 56 per cent, followed by ‘processed cheese’ (21 per cent), butter (10 per cent), ‘other cheese’ (3.9 per cent), and ‘other fats’ and ‘oils derived from milk’ (3.5 per cent) in 2018-19.Second, the lower average final bound duties on dairy products in the US help provide a boost to diary exports from India. According to the World Tariff Profiles, 2019, an average final bound duty on dairy products in the US is around 19 per cent, as against close to 64 per cent in India.Thus, it is evident from the numbers that despite lower milk yield and dominance of small and marginal farmers in dairy activity, India is comfortably placed to produce milk at a cheaper rate. Thus, opening market access for the sector is likely to place these dairy farmers in a disadvantaged position in relation to the large-scale dairy farmers in US.Despite the retaliatory tariffs, overall U.S. agricultural exports rose slightly in 2018 to $140 billion from $138 billion in 2017, partly due to higher imports during the months leading up to the retaliatory tariffs and increased exports to other non-retaliating countries, according to the Congressional Research .India last year announced higher tariffs on a clutch of items in retaliation for the U.S. imposing higher levies on some products shipped from the South Asian nation, mirroring steps taken by China and the European Union. New Delhi, however, repeatedly deferred imposition of the new tariffs as it kept the door open for talks to avert a trade war...thank you