US President Donald Trump has declared a ‘trade war’ of sorts by announcing that the US will impose 25 per cent tariff on steel imports and 10 per cent tariff on aluminium imports. While some experts have termed the decision an “ace”, others have lamented Trump's “blunder”. Electoral promise and trade deficit of the US were triggers for Trump's move. The steel workers of America are considered to be ardent supporters of Trump and direct manufacturers of steel will benefit from the President's move. New jobs may be created, however, a large section of Americans, and the rest of the world, are not amused. The image of the US as a ‘tariff-free’ country has taken a beating. Since it is made known that no countries will be exempted or excluded, many ardent US allies, like Canada and Germany, are sour with the maverick Trump.
India's miniscule export of steel to the US means it may breathe freely, but not other major countries. More importantly, retaliatory steps by other nations may trigger a ‘trade war’ though Trump has declared an “easy win” for him. The European Union (EU) is said to be planning retribution in a big way, by inflicting 25 per cent tariff on the US' steel, aluminium and agriculture imports, bourbon and motorcycles. Many US workers may lose jobs in EU countries. If other countries follow suit, then a vicious cycle may be counterproductive to the US and spell disaster for the global economy which is recouping from the 2008 recession. In the US itself, steel consuming industries may be pummelled with resultant loss of jobs.