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Plurilateral agreements may help keep WTO relevant into the future
Amita Batra
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Earlier this month Ngozi Okonjo-Iweala, director general of the World Trade Organization (WTO), in her lecture at the London School of Economics, emphasised the need to speak up for the multilateral institution, particularly when the dominant funding economy has chosen to suppress its voice and relevance. Her statement augurs well for the WTO, which stands at a crossroads in terms of its fundamental processes and the objective of promoting freer and fairer trade. While there has been much talk about the United States blocking appointments to the Appellate Body of the Dispute Settlement Mechanism, the decline of the institution, in
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Time of India
31 minutes ago
- Time of India
US did not accept India's request for consultations at WTO over import tariffs: Minister
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NDTV
32 minutes ago
- NDTV
Kneel, Deal, Or Bleed: The Trump-enomics Wrecking The World
This is a national crisis, one not of India's making. In the wake of US President Donald Trump's latest outburst on Monday - his threat to further hike tariffs on Indian goods over its oil trade with Russia - it is essential that all Indians rally behind the government, regardless of their political leanings. This is not the moment for partisan sniping. Just as we stood united during the India-Pakistan military standoff after the Pahalgam terror attack and during the 2020 Galwan clashes with China, we must now close ranks again. Why call it a crisis? Because what unfolded yesterday (August 4) was pure Trump: theatrical, provocative and unfair. In a sweeping accusation, Trump charged India with profiteering from Russian oil while war rages in Ukraine, alleging that New Delhi resold Russian crude for a hefty profit. The implication was that India valued margins over morals. He threatened to slap even higher tariffs on Indian exports, higher than 25% that he imposed arbitrarily on August 1. For him, it was moral posturing. For India, it was a punch laced with hypocrisy. India responded with rare fire. In a sharp rebuttal, it called Trump's accusations both misleading and unjustified, defending its right to safeguard national interests. Indian officials pointed to America's own ongoing imports of Russian uranium, palladium and industrial chemicals - quiet deals that don't seem to rile Washington's moral compass. It was a deft move, exposing the duplicity in Trump's rhetoric and holding up a mirror to America's own contradictions. Let's be honest. India's oil trade with Russia is no secret arrangement hidden in some shadowy backroom. It is a transparent, market-driven strategy aimed at stabilising energy costs in a time of global volatility. When Western sanctions disrupted oil flows, India, like many other countries, stepped in to soften the blow, preventing a full-blown price shock. Indian refineries, both state-run and private, made commercial decisions based on cost, supply security and export needs. There was no geopolitical agenda, only the economics of energy security. But in Trump's second act, facts matter less than theatre. On A Rampage His first presidency lit the fuse. The second is blowing up what remained. Since returning to the Oval Office in January, Trump has been on a tariff rampage. Seven months in, the global trading system is unrecognisable. Tariffs have become weapons, trade partners have been reduced to negotiators, and the World Trade Organization - already quite weakened - is now functionally comatose. The numbers tell their own dystopian tale. The average US tariff now exceeds 18%. For some countries, it's closer to 40%. Canada, the European Union, Mexico, India, Japan - even Taiwan - have all been hit. No economy is too friendly or too small to escape the Trump treatment. As August 1's all-out tariff expansion showed - targeting over 90 nations in one stroke - this isn't policy. It's punishment. There is no coherent strategy behind these tariffs - no roadmap, no mutually beneficial agreements. Instead, Trump offers threats and one-page handshake deals with vague promises to "Buy American" and "reinvest in US jobs". He bullies smaller nations into accepting lopsided trade conditions while larger economies are left floundering in uncertainty. India Won't Beg Or Bow India's case is emblematic. Despite not being among America's top-tier trade dependencies, it finds itself in Trump's crosshairs - partly for its growing alignment with Russia, and partly because it is an easy punching bag for domestic optics. Yet, unlike other US allies with vulnerable supply chains, India has leverage. Its economy is surging and its strategic importance - from Indo-Pacific security to chip manufacturing and pharmaceuticals - makes it harder to sideline. India may suffer tariff pain, but it's not begging at the table. It's negotiating with its own cards. That might be why Trump's attack on India's Russian oil imports feels more like performance than genuine concern. The reality is far murkier. The US itself continues to import vital Russian materials, often through quiet backchannels or third-party entities. If morality were truly the yardstick, America's own trade behaviour would need a full audit. Trump's tariffs aren't about correcting trade imbalances or defending American workers. They're about power projection. In April, when he threatened to "liberate" America from bad trade deals, it wasn't economic policy, but a flex. Some journalists have likened Trump's global tariff crusade to a protection racket, and the metaphor holds. His "deals" work like tribute systems: agree to arbitrary terms or face economic punishment. In Trump's trade order, rules and treaties are for the weak. The cost is already visible. The WTO is a ghost of its former self - budget slashed, dispute resolution mechanisms hollowed out. Trade diplomacy, once driven by negotiation and multilateralism, has been replaced by intimidation. Economies have stopped planning for prosperity and begun bracing for the next tariff bombshell. Consequences Come Knocking It's August 2025, and the world is living in Trump's new economic jungle. In April, his dramatic tariff rollout sparked a market panic. Wall Street tanked. Governments blinked. Trump, ever the showman, walked it back, slightly. A few nations got sweetheart deals: the UK secured relatively lenient 10% duties, while the EU and Japan swallowed 15%. For others - Cambodia, Pakistan, even strategic partner South Korea - there was no mercy. Tariffs surged with no clear recourse. America's import duties have jumped from 2% in 2020 to nearly 18% today, bringing in over $100 billion in revenue. MAGA loyalists cheer, seeing a flood of money into federal coffers and a resurgence of American pride. But beneath the jingoism, the economic strain is beginning to show. Consumer prices are rising. Investment forecasts are softening. For the middle-class American, patriotic slogans don't pay the grocery bill. In Washington, it is believed some lawmakers are already pushing back, proposing rebates for low-income households to cushion the tariff fallout - an irony given the GOP's usual disdain for government handouts. But Trump has never been beholden to ideology. His political identity is built on spectacle and exceptionalism. The bigger concern is structural. Trade partners are adapting - quickly and strategically. India, for instance, has begun filling the manufacturing void left by China in American smartphone supply chains. With Chinese goods now heavily tariffed, India's tech sector is outperforming. But even India knows this is a temporary high. Vietnam and the Philippines - favoured by Trump's trade hawks - may ultimately enjoy smoother market access. The message to the world is chilling. Trade with the US only if you are in favour. Otherwise, you are on your own. New World Disorder Germany, long dependent on auto exports, is reeling. Canada is exploring deeper integration with the EU and Asia. Latin American economies are tightening regional trade ties. And China, though wounded, is doubling down on its Belt and Road Initiative (BRI) push, offering cash and credit where the US offers tariffs and threats. The new global order Trump is creating isn't one of American dominance - it is one of fragmentation. He may be winning tactical battles, but he is losing the war for global trust. If allies continue to retreat and trade routes reroute away from Washington, Trump's tariff empire could turn out to be a pyrrhic victory - loud and dramatic, but ultimately self-defeating. What the world needs now is collective defiance. A coalition of countries must step up in resolve and rise to build alternative frameworks. Whether through strengthening regional trade blocs, launching new digital economies, or pushing legal challenges at whatever's left of the WTO, the time for appeasement is over.


Indian Express
16 hours ago
- Indian Express
Brazil chooses local relief over retaliation for US tariffs, sources say
Brazil's government has set aside for now plans for direct retaliation against steep US tariffs taking effect this week, focusing instead on a relief package for industries hit hardest by the levies, sources familiar with the strategy said. Wide-ranging exemptions granted in US President Donald Trump's executive order last week spared some of the most vulnerable sectors of Latin America's largest economy, to the relief of many investors and business leaders. That has left Brasilia cautious about responding to Trump with reciprocal tariffs or other retaliation that could escalate tensions, said government officials, who requested anonymity to discuss confidential deliberations. Talks with Washington are likely to be slow and complex, said one of the sources, so Brazil's government is prioritizing immediate relief for exporters, such as through public credit lines and other support for export finance. Another official said the government is studying potential responses to the tariffs that would affect U.S. companies, but sees them as a last resort if negotiations fail. Those potential countermeasures, now under review, could include suspension of royalty payments for pharmaceutical patents and media copyrights, two sources said. The government had also signaled last year that it was preparing a new tax that could affect big US tech companies, but shelved the plan this year to avoid antagonizing Trump ahead of his April tariff announcement. At the time, Brazil was saddled with a 10% tariff, among the lowest in the world, which many credited to a longstanding US trade surplus with Brazil. Trump then tied a steeper 50% tariff in July to what he called a political 'witch hunt' against former President Jair Bolsonaro, a right-wing ally on trial for an alleged coup plot to overturn his 2022 election loss. Brazilian President Luiz Inacio Lula da Silva initially said he would respond under the country's Economic Reciprocity Law, passed by Congress to provide legal grounds for countermeasures against trade sanctions, fueling speculation about retaliation. Talk of reciprocal action has since faded, even as Lula criticizes Trump's rationale for the tariff hike, defending the independence of Brazil's judiciary and insisting any negotiations should remain strictly focused on trade. US tariff exemptions granted last week for Brazil's aviation, energy and mining industries were taken in Brasilia as evidence that patient diplomacy and lobbying by affected US companies seeking relief was the best way to get results in Washington. Brazil also said it plans to file a formal complaint at the World Trade Organisation over the tariffs, even though that dispute settlement system has been stalled since the first Trump administration. 'You still need to go through the available channels,' one Brazilian official said, while acknowledging that a resolution is unlikely under the current state of the WTO. More immediately, the government is fine-tuning measures to shield sectors most hurt by the US tariffs set to take effect on Wednesday, extending financial relief to companies already facing canceled contracts. Officials have said the package will likely include credit lines and possible tweaks to the export credit insurance and export financing mechanisms, according to one of the sources. Finance Minister Fernando Haddad, who said relief measures could begin rolling out this week, on Friday said the government was never committed to retaliating against Washington. 'We never used that verb to characterize the actions the Brazilian government will take,' he said. 'These are actions to protect sovereignty, to protect our industry, our agribusiness, our agriculture,' he told reporters. 'That word (retaliation) was not present in the president's speech, nor in any minister's.'