The US has imposed tariffs on steel and aluminium imports from India. India, in return, will raise duties on about 30 US imports, including certain iron and steel goods and even fruits, vegetables, almonds and apples. However, India may lose much more than the US in this trade war. US exports are barely 12 per cent of its GDP. India, on the other hand, is the largest exporter to the US after China.

India was earlier on the US radar over India’s imposition of 50 per cent duty (earlier 100 per cent) on Harley Davidson bikes. There were just 84 of these expensive bikes sold in India last year. The US is also reviewing the General System of Preferences that India enjoyed after the US dairy and medical equipment sectors complained over not having easy access to India’s markets. They are especially irked by price controls on items like stents.

The US has always had a grouse on India being categorised as a less developed country. It feels India is no longer an LDC as its per capita income is over $1000 a month and wants India to end the subsidies it gives its exports, particularly in agriculture and the electronics hardware technology parks scheme.