India Postpones Retaliatory Tariffs Against United States Goods Due To Pending Deal On Aluminium Exports

India Postpones Retaliatory Tariffs Against United States Goods Due To Pending Deal On Aluminium Exports

Acting on news that the Trump administration is considering an exemption for the country’s smelters to the blanket tariffs on aluminium it implemented earlier this year, the Indian government has decided to again push back the start date of retaliatory customs duties on an array of U.S. imports.

The Indian government announced its decision yesterday, deferring for the second time the imposition of tariffs on 29 American imports until November 2. The decision to implement retaliatory measures was first passed in June and slated to go into effect on August 4. However, the federal government chose to push back the implementation of tariffs by 45 days, beginning on Tuesday.

Tariffs have yet to be collected, however. A release by India’s revenue department indicated another deferral, pushing back implementation to early November. The deferral is likely in response to the announcement earlier this week that a deal on an exemption to tariffs may be in the works between Washington and India’s trade negotiators.

India continues to argue that its aluminium exports to the United States are insignificant in the larger picture, at least from Washington’s perspective. Per a senior Indian industry executive, India’s aluminium and steel exports to the United States are “not too high” and are generally restricted to specialty goods that are not in wide use.

The aluminium and steel tariffs have wrought appreciable damage to the Indian marketplace, however. In addition to effectively closing off the United States market to Indian producers, a retaliatory tariff from the People’s Republic of China on scrap imports from the United States has diverted massive quantities of scrap aluminium and steel to India. According to numbers from the Aluminium Association of India, imports of scrap aluminium and steel skyrocketed by 128 percent between the first quarter of fiscal year 2018 and the same quarter of fiscal year 2019.