United States President Donald Trump announced the reciprocal tariff policy on Thursday.
An hour before his bilateral meeting with Prime Minister Narendra Modi, Trump again commented on India's tariff structure, saying 'they have the highest tariffs' and 'it is a hard place to do business'.
"I have decided that for the purpose of fairness, I'll charge reciprocal tariffs -- meaning, whatever countries charge the United States of America, we will charge them -- no more, no less. They charge us with tax and tariffs, it's very simple we will charge them with exact tax and tariffs," Trump said.
Trump reiterated that reciprocal tariffs are necessary to ensure fair trade, stating that countries imposing high tariffs on US goods will face identical charges when exporting to the United States.
He also underscored the broader economic impact of this policy, asserting that it would create jobs and encourage more domestic production.
"There could be some short term disturbances but in long term it is going to make a fortune," said Trump
"This is something that should have been done many years ago. China did it at a level that probably nobody has ever seen before...It is going to mean a tremendous amount of jobs, and ultimately, prices will stay the same," he added.
During the press conference, when he was asked about the meeting of Tesla CEO Elon Musk with Prime Minister Modi, Trump said, "They met. I assume he wants to do business in India. But India is a very hard place to do business in because of the tariffs. They have the highest tariffs...It's a hard place to do business. I would imagine he met possibly because he is running a company, he is doing this as something that he has felt strongly about for a long time."
Speaking on the issue of reciprocal tariffs, Trump highlighted India's past trade policies, citing the case of Harley-Davidson motorcycles as an example of how American companies have been forced to set up manufacturing units abroad to bypass exorbitant import duties.
"Traditionally, India is right at the top of the pack pretty much. There are a couple of smaller countries that are actually more but India charges tremendous tariffs. I remember when Harley Davidson couldn't sell their motorbikes in India because of the fact that in India -- the tax was so high, the tariff was so high, and Harley was forced to build," he said, US Network Pool via Reuters reported.
"But I think they built a factory in India in order to avoid paying the tariffs. And that's what people can do with us. They can build a factory here, a plant or whatever it may be here and that includes the medical, that includes cars, that includes chips and semiconductors."
© 2025