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S&P Global on US Tariffs: Asia-Pacific Retaliation Risk

25 February 20251 min read
ECONOMYS&P Global on USTariffs:Asia-PacificRetaliation Risk25 February 2025safalsetu.com

Why in the news

S&P Global Ratings warned that several Asia-Pacific economies could face higher US tariffs under the Trump administration, with India among the most exposed.

Key facts

  • Highest retaliation risk: India, South Korea, Thailand; Vietnam, Taiwan, Thailand and South Korea are sensitive because of heavy US exposure.
  • Already imposed: 10% extra on Chinese imports; 25% on steel and aluminium imports.
  • Trump announced plans to raise reciprocal tariffs on key partners, including India.
  • Some Asia-Pacific economies levy higher tariffs on US goods than the US does on theirs, inviting retaliation.

Uncertainty ahead

  • The US holds broad powers to impose tariffs, and bilateral negotiations shape policy.
  • Manufacturing, steel and technology are likely to face higher barriers.

India’s position

  • Exposed, but a big domestic market gives partial protection.

Exam angle

  • Rating agency: S&P Global Ratings.
  • Term: reciprocal tariffs.

Test yourself

1. Which set of countries did S&P Global rank highest in risk of US tariff retaliation?

S&P flagged India, South Korea and Thailand as most at risk.

2. What additional tariff had the Trump administration already placed on steel and aluminium imports, per S&P Global's note?

A 25% tariff on steel and aluminium; 10% extra on Chinese goods.

3. According to S&P Global, what gives India some insulation from US tariff shocks?

India's big domestic market cushions external trade shocks.