Days after jibe on PM Modi, Trump threatens to impose 'reciprocal tax' on India, China

US President Donald Trump has again raised the issue of unfair trade, targeting China and India for not doing enough while doing trade with the US. He has now threatened to impose "reciprocal tax" on all those countries, which have treated the US "unfairly". On February 27, Trump raked up the issue of import duties on Harley-Davidson motorcycles in India. Speaking at a meeting with the nation's governors at the White House, he called for fair and reciprocal trade deals and repeatedly emphasised that the US was "getting nothing" from New Delhi's February 12 announcement, slashing customs duty on imported high-end motorcycles to 50 per cent.

"When Harley Davidson sends a motorcycle to India, as an example, they have to pay 100 percent tax," Trump said, adding, "Now, the Prime Minister, who I think is a fantastic man, called me the other day and he said we are lowering it to 50 per cent. I said okay, but so far we're getting nothing. So we get nothing, he gets 50 [per cent], and they think like they're doing us a favour. That's not a favour," he added. He was referring to conversation with Modi earlier this month.

On Friday, Trump said: "We're going to be doing a reciprocal tax programme, at some point so that if China is going to charge us 25 per cent or if India is going to charge us 75 per cent and we charge them nothing," he said as he imposed a 25 per cent tariff on steel and a 10 per cent tariff on aluminium from all countries except Canada and Mexico.

"They are 50, they are 75 or they are 25, we are going to be doing the same numbers. It's called reciprocal. It's a mirror of tags. So they charge us 50, we would charge them 50," Trump said. The US President said the stage for the imposition of reciprocal tax has been set in the first year of his administration. He said American companies had not been treated fairly by other countries.

Referring to a tweet by Tesla chief Elan Musk, Trump said China charges 25 per cent duty on American cars whereas it is just 2.5 per cent on import of Chinese cars into the US. Trump said the "reciprocal tax" programme would ensure "fair trade deals" for the US. The US president mentioned China several times as he signed two proclamations to impose import duties on steel and aluminium.

"China says it's got two per cent, but it sends much more. We're going to have a great relationship, hopefully, with China, but we have to do something. We're losing with China $500 billion a year. We have to do something," Trump told reporters during the signing ceremony. Trump said the US is going to stop the trans-shipping. "Well, we'll let it happen, but they've got to pay. So trans-shipping, frankly, is a big deal," he said. "And they trans-ship, and we're going to accept their product, but it's going to cost a lot of money from the standpoint of the trans-shipper," he added.

The US, he said, is negotiating now with China. "We're in the midst of a big negotiation. I don't know that anything is going to come of it. They have been very helpful. President Xi (Jinping), I have great respect for. A lot of respect," he said. "But we're going to cut down the deficits one way or the other. We have a deficit with China of at least $500 billion. When you add intellectual property, it's much higher than that," Trump said.

With inputs from PTI