Will Prime Minister Modi ride Harley Davidson and President Trump eat Rasgoolas?
March 11, 2018 :As trade wars getting botched up and the swords are drawn, the question asked is who will ride the roughshod over the other. The trade war is threatening to precipitate further with the US naming more countries for retaliatory action other than India, China and EU. Some forty-odd products are identified for taking retaliatory action against India and China. The prospects of Trump administration using infringement on intellectual property rights (IPRs) may be a double whammy for India since it is already in the watch list.
India’s export of steel to the US is little over US$ 2 billion and that way far much lesser than what the Chinese and Koreans do. But, the proportion of US$2 billion to India’s total exports worldwide and to the US is a quite a tidy sum in a relative sense. But the most bizarre accusation is about the Harley Davidson, the sturdy motorbike founded in the year 1903 and undergone several management changes since then. Trump’s claim is that India has clamped heavy import duty on the Harley to protect the domestic manufacturers. If that measure of protection continues, Trump lamented India should be prepared for the same degree of retaliation from the US.
Does the fact corroborate this US assertion? Indian trade experts point out that Harley Davidson is an insignificant item in the bilateral trade, hardly 0.05% of total India’s imports from the US. The threatening tone of the Trump to retaliate in the same way can at best be a rhetoric because India’s export of vehicles to the US is just over 1000 pieces a year. Most of these exports are destined to Latin America and Mexico. It is not the first time Harley has become a tool for India bashing by Trump. Despite the insinuations and mimics that followed, India has reduced the import duty by almost half. Yet, Trump’s ire seems to be unsettled. The other day also, Trump reiterated the same stand. Does the omnipresent United States Trade Representative (USTR) fail to brief the President on this vital issue and set the record straight?
Not that India lacks ammunitions to counter the pedagogue. Modi Administration, for the first time after 40 years or so, has started importing crude and liquid gas from the US as a part of the Buy America campaign. Also, the US has replaced Russia as the major source for defence equipment to India. The joint military drill goes much beyond the bonhomie to stall Chinese interests in the North China Sea. India is going to be a defense equipment manufacturing hub for the US to expand its footprint in that domain. India will be a market for exporting several billions worth of aircrafts of all hues and sizes, having regard to the fact that India’s requirements are upwards of 1000 aircrafts in the near future. Can Boeing is upbeat on such a hot opportunity? In short, the US will have to depend on the rest of the world, particularly India, to achieve its strategic fulfilment.
This is known to the US more than anyone, including how valuable the Indian professionals to the fast depleting number of people who opt for technical jobs in the US. Artificial intelligence and robotics can replace human resources to some extent. Yet, the US needs front end techie savvy guys to install and maintain such systems. They also know Indian professionals fit the bill more than anyone. Still, one may wonder why the US is indulging in India bashing. If the purpose is to make Prime Minister Modi to drive Harley Davidson, we should make President Trump to Rasgoolas ( an Indian sweet); a tit for tat.