Washington/Beijing: The global economy is once again shaken by the tariff war between the two superpowers. On Tuesday, the US imposed a new tariff of 50 percent on Chinese goods, taking the total duty to 104 percent. In response, China retaliated on Wednesday and imposed an 84 percent tariff on US goods. This ‘brick to stone’ action has taken the trade war between the two countries to the extreme, and now the world’s eyes are fixed on the next step of this confrontation.
From the spark of tariff to war
It all started last week, when the US imposed a reciprocal tariff of 34 percent on Chinese imports. China immediately retaliated and imposed the same duty on US goods on Friday. The situation worsened further when former President Donald Trump warned that if China did not back down, an additional 50 percent tariff would be imposed by Tuesday. Trump’s threat became reality, and the total tariff on Chinese goods increased from 20 percent to 104 percent. Beijing did not delay either—it imposed sanctions on 18 American companies with an 84 percent tariff.

Chinese Foreign Ministry spokesman Lin Jian said in a stern tone, “If the US wants to wage a trade war with us, we will fight to the end. Every necessary step will be taken to protect our interests.” On the other hand, the Finance Ministry of the Xi Jinping government issued a statement attacking the US. The statement said, “This tariff is the latest mistake of the US. It has not only harmed China’s rights, but has also weakened the global trade system.”

Attempt to woo India

Amidst this war, China has extended a hand of friendship towards India. Yu Jing, a spokesman for the Chinese Embassy in India, wrote on X, “Two big developing countries should stand with each other in this crisis.” This is not the first time that China has appealed to India to support it against the US tariff. Beijing has earlier talked about the unity of the ‘elephant and the dragon’. But India has maintained silence on this. A foreign ministry official, on the condition of anonymity, said, “There has been a difference between China’s words and actions. We will adopt a balanced approach.” Global concern, economic threat Economic experts consider this tariff war as a danger signal for the global economy. Delhi-based economist Professor Arun Sharma says, “This is not just a fight between America and China. This will disrupt the supply chain, increase prices and the economy of smaller countries can collapse.” He believes that for countries like India, this is both a challenge and an opportunity – if it succeeds in increasing exports. American businessman John Howard, who imports Chinese electronics, says, “After the 104 percent tariff, the cost has increased so much that we will either have to increase prices or close the business.” On the other hand, a Chinese businessman Liang Wei says, “The American market has now become difficult for us. We will have to find new ways.” Why is India silent? India’s silence despite China’s appeal raises many questions. Relations between the two countries have been strained since the 2020 Galwan conflict. Professor Sharma says, “It is risky for India to trust China. It says one thing and does another. It is better that we remain neutral and look after our interests.” India is already emphasizing on ‘Make in India’ and self-reliance, which may get a chance to strengthen further in this situation.

The way forward

This tariff war does not seem to stop yet. Both America and China are adamant on their respective stands. But its impact will not be limited to these two countries only. It can have a profound impact on global trade, inflation and employment. Will this war end, or will it intensify? The answer to this will be found only in the coming days. At present, it is clear that this tariff battle has now taken the form of a ‘world war’, and every step of it will affect the world.