Retail nightmare incoming? Donald Trump's trade policies may lead to empty shelves and full-blown recession by June
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A wave of economic uncertainty is sweeping over the United States as experts caution that US president Donald Trump's deepening trade war with China is poised to land a tough blow on American businesses and consumers this summer, as per a report.America could start feeling the weight of the tariffs by mid-May, with empty shelves in stores, suspended freight transport, and a recession looming as early as June, according to a report published by management firm Apollo Global Management Apollo's head economist Torsten Slok explained the chronology; after Trump announced his "liberation day" tariffs on April 2, it takes about 20 days to 40 days for container ships to sail to the United States from China, so, Slok estimates that container ships coming to US ports could come to a stop by mid-May, as per Investor's Business Daily (IBD).Slok pointed out that, it then takes about 1 day to 10 days of transit time for trucking/rail to bring goods from the ports to cities, as per the report. Apollo Global Management forecasted that by late May, domestic freight demand will "come to a halt" and that there will be "empty shelves" with companies responding "to lower sales," reported IBD.According to the report, Slok predicted that there will be layoffs in domestic freight by early June, and retail industries will be hit with recession in the US, this summer.Logistics companies such as Flexport reported a decline in shipments from China to North America, with cancellation rates reaching 50%, a level not seen since the early stages of the COVID-19 pandemic, as per IBD.Flexport revealed that the short-term outlook for shipment-volume growth from Southeast Asia to North America "remains muted," as per IBD.Schwab Chief Global Investment Strategist Jeffrey Kleintop said, "Ports are unloading above-average container arrivals in the past couple of weeks that were stocking up ahead of the tariffs," as quoted in the report. Kleintop mentioned that, "But for booking in the weeks and months ahead, we are seeing falling demand and high cancellation rates rivaling those of the pandemic," quoted IBD.The National Retail Federation (NRF), whose members include large retailers such as Walmart and Target, has cautioned that US import cargo volumes would decline by at least 20% year-on-year in the second half of 2025, as per the report. This is mainly because US businesses are halting orders from China due to the trade tensions between both nations, according to IBD.Tariffs have caused a major slowdown in shipping, with companies like Flexport reporting 50% cancellation rates for shipments from China, as per Investor's Business Daily.Yes. By late May, the domestic freight demand is predicted to halt, which means fewer goods will reach US cities, potentially leading to empty shelves in stores.
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Hans India
20 minutes ago
- Hans India
US may not impose additional 25 pc tariffs on India over Russian oil, hints Trump
New Delhi: The Donald Trump administration may not impose secondary tariffs on India over purchasing Russian energy, as the US President said that Russia has already lost a key oil client. Speaking to Fox News aboard Air Force One en route to Alaska, Trump said the US may not impose secondary tariffs on countries continuing to buying Russian crude oil. "Well, he (Vladimir Putin) lost an oil client, so to speak, which is India, which was doing about 40 per cent of the oil. China, as you know, is doing a lot…,' said Trump. 'And if I did what's called a secondary sanction, or a secondary tariff, it would be very devastating from their standpoint. If I have to do it, I'll do it. Maybe I won't have to do it,' he added. The secondary 25 per cent tariffs on India are likely to come into effect from August 27. Earlier this week, US Treasury Secretary Scott Bessent said if 'things don't go well' between Trump and Putin at the Alaska summit, then secondary sanctions on India for purchasing Russian oil could go higher. Meanwhile, the government has already said the targeting of India is unjustified and unreasonable. 'Like any major economy, India will take all necessary measures to safeguard its national interests and economic security,' it said. The fact is that India has sharply increased its purchases of oil and gas from America. This, in turn, has led to a reduction in India's trade surplus with the US, which is a major aim of the Trump administration's trade policy. Official figures show that India's oil and gas imports from the US have jumped by as much as 51 per cent from January to June this year. The country's liquefied natural gas (LNG) imports from the US nearly doubled to $2.46 billion in the financial year 2024-25 from $1.41 billion in 2023-24. Prime Minister Narendra Modi had assured in February that India would increase energy imports from the US to $25 billion in 2025 from $15 billion in 2024 to help reduce the trade deficit of the US. This was followed by Government-owned Indian oil and gas companies entering into discussions for more long-term energy purchases from the US companies. New Delhi has also made it clear that it was diversifying its sources of energy imports to reduce dependence on Russian oil. New Delhi has also made it clear that India and the US share a very important strategic relationship that goes beyond trade.
The Wire
20 minutes ago
- The Wire
Why Gautam Adani is a Factor in India-US Ties
Why does Narendra Modi feel the need to protect Adani to that extent vis-à-vis the American investigators? We must get back to the genesis of their relationship in Gujarat to respond – partly – to this puzzle. Gautam Adani was not at all an important businessman before Narendra Modi helped him to grow in Gujarat as chief minister of the state. Adani was born in 1962 in Ratan Pol in the old city of Ahmedabad, his parents having migrated from north Gujarat. At the age of 18, he dropped out of Gujarat University and moved to Bombay, served a stint as a diamond sorter at Mahindra Bros. and then became a diamond trader. He moved to Ahmedabad in 1981 to help his brother, Mahasukh, who was starting a plastic-film manufacturing business. This company was heavily dependent on supplies of PVC. The sole producer of PVC in India at that time was IPCL, which used to supply two tonnes per month to the Adani brothers. But their rapidly growing business needed over 20 tonnes per month. Therefore, Adani began importing plastic granules through the Kandla port. The Adani group then diversified. In 1988, Gautam Adani set up a commodities trading venture called Adani Exports. In the next four years, his import orders grew from 100 metric tonnes (MT) orders to 40,000 MT. In 1991-92, Adani and agribusiness group Cargill were given 3,000 acres of coastal land in Kutch by the Chimanbhai Patel government for salt production. The project fell through after protests by George Fernandes and others, and Cargill pulled out. Adani held on to his land and began thinking of converting Mundra into a big port. In the framework of the nascent liberalisation, the Gujarat Maritime Board decided to allot ports to private companies in a joint venture with the state – an initial list of 10 ports was created, which included Mundra, which was 14m deep (deeper than Kandla at 12m) and allowed it to berth larger ships of 200,000 MT and above. In 1993, the company was incorporated into a limited company with two backers, Adani himself and Rajesh S. Adani, his younger brother. In 1997, Adani Exports Ltd. entered into a joint venture with the Gujarat government to build a mega port at Mundra. Around that time the Adani group established a base in Dubai, where two of the five Adani brothers were primarily in charge of the supply chain of Adani Exports. In 1999, Adani ventured into coal trading for the first time, with a shipment landing at Mundra. In 2000, Adani let P&O Australia, one of the world's largest port operators, set up a container terminal in Mundra. There is no evidence that Gautam Adani and Narendra Modi knew each other before the latter became chief minister, but they became very close soon after, in the aftermath of the 2002 pogrom. As this tragic episode of communal violence disrupted the state economy for weeks, businessmen including senior members of the Confederation of Indian Industry, criticised Modi. Rahul Bajaj, a senior member of the CII, described 2002 as a 'lost year for Gujarat' and challenged Modi with several 'tough questions' during a CII meeting in Delhi in February 2003, where Jamshyd Godrej also raised the issue. In November Azim Premji declared similarly at an IIM Ahmedabad seminar: 'Investors are wary of coming to Gujarat due to the lingering communal tensions in the state apart from its proximity to Pakistan.' Tarun Das, the then director-ceneral of the CII went to Gandhinagar one month after the meeting of the organisation during which Narendra Modi had been criticised in Delhi and told him that the CII leaders 'were very sorry for all that had happened.' But Gautam Adani and other CII members from Gujarat had already analysed the attitude of bigger businessmen from Gujarat as a great opportunity. They formed the 'Resurgent Group of Gujarat' in order to counter what they regarded as 'a concerted attempt by a section to defame Gujarat.' Among them were Dr Karsan Patel and Ambubhai Patel (Nirma group), Indravadan Modi (Cadila Pharmaceuticals), Pankaj Patel (Cadila Healthcares), Chintan Parikh (Ashima) Anil Bakeri (Bakeri group) and, last but not least, Gautam Adani who took a leading role. Like Modi, he was relatively isolated in 2002-03. He was not part of the business establishment either, as evident from his marginal position in terms of interlocking directorates. Both were newcomers to the high table of national politics on the one hand and big business on the other. Also read: Gautam Adani a 'Personal Matter': PM Modi Deflects Question; 'Covering Up Corruption,' Says Opposition When the first Vibrant Gujarat meeting took place in September-October 2003, Adani went further than his colleagues and pledged Rs 150 billion in investments. This was a major turning point of the Adani-Modi relationship: Modi could start to pay back for Adani's support, not only within the CII but in the context of his transition from the role of 'Hindu hriday samrat (ruler of Hindu hearts)' to that of ' vikas purush (one who would bring about development)'. The Adani Port and SEZ (APSEZ) at Mundra (Kutch district) was created the same year to provide cargo handling and other port services. It soon became India's first multi-product port-based SEZ, after Adani was granted 3,585 hectares (ha) of land, including 2,008 ha of forest and 990 ha of gauchar or village grazing land. Two converging investigations have alleged that the Adani Group bought this land, in one area, at a rate ranging from Re 1 to Rs 32 a square metre when the market rate was over Rs 1,500 rupees a square metre and, in another area, at the cost of Rs 10 rupees per sq. m., when the market price there was between Rs 700 and 800 per sq. m. In Mundra, Adani acquired up to 7,350 ha. Forbes argues, on the basis of the signed agreements, that for most of this area 'he got the 30-year, renewable leases for as little as one US cent a square meter (the rate made out at 45 cents a square meter). He in turn has sublet this land to other companies, including state-owned Indian Oil Co., for as much as US$ 11 a square meter. Between 2005 and 2007 at least 1,200 hectares of grazing land was taken away from villagers.' During the 2009 Vibrant Gujarat summit, the Modi government 'signed MoUs allowing the Adani group a Rs-150-billion expansion of its SEZ over the next 15 years. The government topped off its largesse of land to the Adani group with five-year tax breaks of over Rs 32 billion, almost four times what it had marked for redeveloping Kutch after the 2001 earthquake. Government data shows an investment of Rs 1.32 trillion in the Adani SEZ, port, and power plant, but only 38,875 jobs were created. That comes to an astonishing figure of Rs 33.8 million for creating one job...'. This is a clear indication of capital intensity – a question we'll return to below. In 2013, a CAG report pointed out that in the Adani Group's SEZ in Mundra '14 lease deeds for an area of 4,84,326 sq. mt. in MPSEZ were registered during the period from December 2008 to November 2011. However, the Collector had given permission to only one unit [...] Accordingly, the transfer of land admeasuring 4,65,728 sq. mt. by way of lease in the remaining 13 cases were irregular'. The CAG also indicted the Gujarat government for purchasing electricity from the Adani group at an abnormally high price. It pointed out that this 'non-adherence to the terms of Power Purchase Agreement led to short recovery of a penalty of Rs 1.60 billion and passing of undue benefit to a private firm'. In 2012, the Modi-Adani connection was targeted by Arvind Kejriwal, the leader of the Aam Aadmi Party who, the year before, had taken part in anti-corruption campaigns along with Anna Hazare. He accused the Gujarat government of buying power from the Adani Group at Rs 5.45 per unit when the Gujarat Mineral Development Corporation had made a better offer. Gas was another source of income for the Adani group, as it had also acquired a monopolistic position in the supply of CNG in Ahmedabad. In its last report dealing with the Modi government in Gujarat, the CAG reiterated the critique it had made in 2012 against the Adani group and arraigned the Essar group too: "…The purchase of power from the private sector increased to 37.22% (2012-13) from 15.22% (2008-09). Of this increase, the share of Private IPPs in power purchased from private sector [the Adani and the Essar groups], increased to 82.75% (i.e. 22,562.17 million units) in 2012-13 from 66.59% (i.e. 5,653.24 million units) indicating an increase of 300% in purchase of power from them during 2008-09 to 2012-13." The Adani group was also targeted by environmentalists. The Gujarat Coastal Zone Management Authority (GCZMA), in May 2006, formed a subcommittee which reported that the Adani Group had built many bunds in the inter-tidal area and blocked many creeks feeding water to the mangrove patches. To no avail. Four years later, in December 2010 the Ministry of Environment and Forests (MoEF) sent an inspection team to follow up on complaints from local inhabitants. The report presented after the visit found many instances of non-compliances. It made the same observations regarding large scale destruction of mangroves and obstruction of creek systems and natural flow of seawater because of reclamation. It made no difference. On September 14, 2012, the Minister of State of Environment and Forests (MoEF), Jayanthi Natarajan constituted a Committee under the Chairmanship of Sunita Nair, the Director General of CSE, for an inspection of Mundra port. It reached the same conclusions as its predecessors. Also read: 'Modi's Hands Tied Due to US Investigation into Adani,' Says Rahul Gandhi All the inspectors and experts have also observed that the Mundra thermal plants of Adani and Tata released fly ash, despite the terms of the 2007 clearance. In 2011 the Gujarat Pollution Control Board Inspection revealed that about 27,127 MT of fly ash was found to be dispersed in low-lying areas of the MPSEZ. The Sunita Nair committee made a similar observation. When Megha Bahree visited the place, she noticed that 'Fly ash and saline water from Adani Power and a nearby Tata Power Co. Ltd. plant are spoiling the crops and making the soil less fertile…'. The Sunita Nair committee recommended a Rs 2 billion environment restoration fund (ERF), but no penalty was imposed on either company by the government. In 2016, the Gujarat high court appointed another committee to enquire about the degradation caused by the Mundra port. It came to the same conclusion as its predecessor but, says environmentalist Mahesh Pandya, 'If you ask the Gujarat Pollution Control Board or the state environment and forest department how many notices they have served to the company, you will find none.' By the end of Modi's chief ministership, the combined market value of Adani Enterprises, Adani Power and Adani Ports and Special Economic Zones (APSEZ) were close to the value of Reliance Industries – whereas the Adani group was five hundred times smaller only 13 years before, in 2001. Indeed, the turnover of the group rose more than 20-fold, from Rs 37.41 billion in 2001-02 to Rs 756.59 billion in 2013-14. In fact, the rise of the Adani group accelerated in 2013 and 2014 when Modi became a strong contender to the post of Prime Minister: the market capitalisation of its companies increased by 250% between September 2013 – when Narendra Modi was declared the BJP's official candidate for prime ministership – and September 2014. Between September 2013 and May 2014, the wealth of Gautam Adani had already increased by Rs 501.31 billion because of the market capitalisation of his companies (it increased by Rs 18 billion every day during the week that followed Modi's electoral success). Mukesh Ambani's wealth increased by 'only' Rs 305.03 billion rupees (US$ 3.81 billion) during the same period. This sudden prosperity could be explained only by Adani's close relation with Narendra Modi – which became obvious when Modi used Adani's chartered plane on his campaign trail across India in the run-up to the 2014 elections. On May 22, 2014, the day he was sworn in as prime minister, he flew to New Delhi from Ahmedabad in Adani's private aircraft, the Indian flag embossed on the aircraft to his right, and on his left, an embossed logo of the Adani Group – the duo was transitioning from the state to the national level. Today's situation is the legacy of these Gujarat years which saw the making of a new oligarch. Since then, the mutual dependence has further deepened. Both men need each other in a very classic manner: the politician offers protection to the crorepatti who pays for his expenditures – including election campaigns whose cost represented billions of dollars in 2014, 2019 and 2024. Whether Narendra Modi can help Gautam Adani to escape from the American investigations remains to be seen as easily as from the Indian ones. In diplomatic relations, there are wheels within wheels. This article draws from my latest book: Gujarat under Modi. The Blueprint of Today's India, Bangalore, Westland/Context, 2024. Christophe Jaffrelot is Senior Research Fellow at CERI-Sciences Po/CNRS, Paris, Professor of Indian Politics and Sociology at King's College London, Non resident Scholar at the Carnegie Endowment for International Peace and Chair of the British Association for South Asian Studies. The Wire is now on WhatsApp. Follow our channel for sharp analysis and opinions on the latest developments. Advertisement
Indian Express
20 minutes ago
- Indian Express
The Alaska Report Card: First assessment of who won what, and how
The first face-to-face conversation between the leaders of the United States and Russia since the war in Ukraine broke out almost three and half years ago, was significant in itself — even though the three-hour discussion in Alaska did not lead to a ceasefire 'deal'. Details of the outcome of the meeting are sketchy. Both President Donald Trump and President Vladimir Putin gave vaguely-worded statements to the media, with no specifics or details, and refused to answer any questions. That was especially odd for President Trump, who loves to give long, impromptu press conferences every day. The stage in Alaska's US military base was set with 'Pursuing Peace' as the backdrop, but it did not, it seems, lead to any immediate concrete outcome. Trump, however, said that he would talk to leaders of NATO countries, Ukraine's President Volodymyr Zelenskyy, and others and brief them on his conversation with Putin. So, in the absence of many details, and based on the statements of the two leaders and their import, this is how the summit in Alaska may be read. For Putin, this was a win from the start. His swagger on the red carpet that awaited him, and the handshake with the US President at a US military base on US soil said it all. He had won the first battle of perception — that he was no longer a global outcast, shunned and sanctioned for invading Ukraine, and terrorising Europe about what he plans to do next. He got a US Air Force welcome with a B-2 bomber and F-22 Raptors, and was honoured by Trump as an equal, a peer, a fellow head of state, and not somebody who is accused of war crimes in the middle of a bloody ongoing war. Putin was clear in his objective: he wanted the sanctions on Russia lifted. And he came prepared with a delegation of businessmen and advisers who deal with the business dealings of the Russian state. While the circle of advisors in the meeting was small, the Russian leader underlined the trade and business component very clearly in his remarks. He said that Russia-US trade had started to grow under Trump, even though the growth rate was not high currently. 'Our trade started to grow after the new US administration came to power. So far, it's merely symbolic, but it's still a rise of 20%. I mean that we have a lot of promising areas for joint work,' he said. Putin also said that Russia and the US have a lot to offer each other in various areas of cooperation. 'Russia-US business and investment cooperation clearly has a lot of potential. Russia and the US have a lot to offer each other in trade, the energy sector, the digital industry, high technology and space exploration. Arctic cooperation also looks relevant, as well as the resumption of interregional ties, particularly between Russia's Far East and the US West Coast.' This was a clear indication of what he wants from the negotiations with the US, as his priority number 1. Putin's other important objective is 'security', and he underlined that as well in his comments. He said that Russia was ready to work to ensure Ukraine's security as well: 'I agree with President Trump — he has spoken about it today — that Ukraine's security also needs to be ensured. We are certainly ready to work on that.' What Putin did not say — and what he obviously meant — was that Ukraine's security umbrella should be with Moscow's approval, and that implied its membership of NATO, or the presence of any NATO troops in Ukraine's periphery, was ruled out. For Trump, the meeting in Alaska was supposed to be the biggest stage for his self-acclaimed deal-making, and he wanted to be seen before the world as the ultimate peacemaker that he believes himself to be. What he did achieve was to get the Russian President to the table to talk about ending the war. That was an incremental step forward for the American President — Putin announced that Russia was interested in putting an end to the crisis: 'Our country is sincerely interested in ending it all.' But Trump got no guarantees beyond that — not in public statements, at least. If he had hoped to close a straight deal on ending the war, that did not happen. To be fair, the US President had moderated expectations ahead of the summit, saying that it would be a 'feel-out meeting' with Russia's leader. It was possibly the other way around though — it was Putin who 'felt out' and took a measure of Trump. In an interview given to Fox News' Sean Hannity, the President said that the meeting was a '10' — even though the vibes and the statements in Alaska did not give others the confidence of that high score. Fox News reporters, who are mostly aligned closely with Trump's agenda and voice, talked down the meeting. The planned luncheon after the discussions — the officials had rationed about 6 to 7 hours — was cancelled, and both Presidents made quick exits from Alaska, which was another indication that the result was not a win for the US. The leaders of Europe and Ukraine's President Volodymyr Zelenskyy will now be waiting for a briefing from the US President and his aides. They would be counting on the fact that their own pre-briefing and their warnings that Putin was not serious about 'pursuing peace', would have become clear to the US President. Trump had warned that Russia would face 'very severe consequences' if he determined during the summit that Russia's leader was not serious about ending the war. Zelenskyy will certainly remind Trump of that statement. For India, it was a night on the edge. South Block tracked the meeting closely, and Indian interlocutors will be reaching out to their American and Russian counterparts to get a sense of what happened behind closed doors. India faces a 50 per cent tariff — 25 per cent as 'penalty' for buying Russian oil — and therefore has a clear stake on the outcome of the meeting. Trump, after all, seems to believe that his squeezing of India by slapping the 25 per cent tariff brought Russia to the table. US officials, including the Treasury Secretary, have warned that in case there is no deal, an even higher penalty might be imposed. But a glimmer of hope did seem to appear in Putin's statement that the agreements reached in Alaska 'will be the starting point for resolving the Ukraine issue' and improving Russia-US relations. Trump himself described the meeting as 'productive'. But he acknowledged that the two leaders fell short, at least for now. 'We haven't quite got there, but we've made some headway…There's no deal until there's a deal,' he said. For New Delhi, this little headway is important — and offers some hope of the pressure easing.
