China, tariffs are harmful and illegal. India postpones talks with the US
The earthquake triggered by the US Supreme Court ruling could call into question many of the agreements signed with Asian countries
from our correspondent Marco Masciaga
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Key points
NEW DELHI - After a few days of silence, the Chinese government has commented on both the US Supreme Court's decision to invalidate the so-called reciprocal tariffs sought by Donald Trump and the US President's subsequent decision to impose generalised tariffs of 10 per cent, later raised to 15 per cent within less than 24 hours. Beijing, said the Ministry of Commerce, is making a "thorough assessment" of the ruling, but in the meantime has returned to urging Washington to eliminate "unilateral tariff measures" against its trading partners, warning that a clash between the two countries would be "harmful".
"Unilateral tariffs by the United States violate international trade rules and American laws and are not in anyone's interest," the ministry made known. What is certain is that the Supreme Court ruling indirectly served Beijing's interest. When Chinese President Xi Jinping receives Trump next 31 March, his negotiating power - with tariffs now down to 15% for the next 150 days - will be 'much stronger' than expected, explains Wu Xinbo, director of the Center for American Studies at Fudan University. For example, as part of the previous tariffs negotiations, China had pledged to buy some 25 million tonnes of soya. 'If those tariffs are now deemed illegal, the 'soybean card' goes back into China's hands,' Wu explains.
Most Asian governments have decided to respond with a mixture of caution and tactical wait-and-see attitude to the U.S. Supreme Court decision that on Friday invalidated most of the tariffs imposed over the past ten months by the Trump administration. The caution is dictated by the awareness that, despite the resounding legal defeat, the extortionist negotiating style practised in recent months by the White House is not destined to suddenly fade away. The wait-and-see attitude is the result of a ruling that could legitimately invalidate the agreements made in recent months (weeks in the case of India, even hours in that of Indonesia) and that in many cases have not yet been ratified by national parliaments, where hostility to concessions made under blackmail could mount.
The Indian Answer
For the time being, the one who has decided to stall is India, by far the most difficult customer among those the American negotiators have been dealing with in recent months. New Delhi was about to send a delegation to the United States to work out the details of a deal outlined in broad strokes in recent days, but nothing came of it. "The decision to postpone the visit was taken after a discussion between officials on both sides," an unnamed source told the Reuters news agency, adding that "no new date has been set". On Saturday, India's Ministry of Commerce had let it be known that it was studying the Supreme Court's ruling and subsequent moves by the White House, which on Friday, in response to the stinging legal defeat, announced generalised tariffs of 10 per cent, rising the next day to 15 per cent.
Despite Saturday's increase, a 15% tariffs is still an unhoped-for improvement for India. In recent weeks, New Delhi had pledged not to import any more Russian oil in return for the abolition of punitive tariffs of 25 per cent, tariffs that had been imposed using the International Emergency Economic Powers Act (Ieepa), which the Supreme Court ruled was unusable. In the coming weeks it will be interesting to see whether the tapering of Russian oil purchases will continue or Delhi will feel disengaged from the commitment.
