US softening on China tariffs brings little relief from trade uncertainty: Garima Kapoor
Even as U.S. President
Donald Trump
signalled a softening stance on tariffs imposed on Chinese imports, global trade may continue to operate under heightened uncertainty, according to Garima Kapoor of
Elara
Capital.
In an interaction with ET Now, Kapoor reflected on the recent remarks by President Trump, who suggested that while tariffs on China may come down, they are 'not going to zero as of now', leaving room for partial relief but continued friction between the world's two largest economies.
She emphasised that the evolving trade relationship between the two economic superpowers is setting the stage for a "new normal" in global commerce.
Kapoor noted that much will depend on the nature of discussions and consultations between the two countries. However, she pointed out that the days of extremely low U.S. tariffs could be over.
'Fair to assume that US' average tariff, which used to be about 2–2.5%... is unlikely to stay there,' she said, adding that the 'average tariff is expected to come up, maybe in the handle of about 10 odd per cent'.
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Beyond trade, Kapoor also emphasised that tensions between the U.S. and China span broader issues, including technology, patents, and national security. 'So, in the near term, we are likely to probably address greater issues of uncertainty rather than issues relating to tariff-related hikes,' she said.
These concerns underline the growing consensus that global supply chains and economic strategies may need to adapt to a structurally altered trade environment, irrespective of short-term adjustments in tariff policies.
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