An Indian team of trade negotiators will soon be travelling to the United States once again, to seek clarity regarding several recent announcements from Washington, including a proposed 10% tariff on imports from BRICS countries, as well as to continue negotiations for a ‘mini’ trade deal and a wider Bilateral Investment Treaty. 

According to sources and trade experts, the prospect of an added tax on all BRICS members — apart from the tariffs mentioned in U.S. President Donald Trump’s letters already sent to several BRICS countries — calls into question the sanctity of any trade agreement with the U.S.

Mr. Trump first raised the spectre of a tariff on BRICS countries last Sunday, and then doubled down on it during a Cabinet briefing on Tuesday. “Anybody that’s in BRICS is getting a 10% charge pretty soon… If they’re a member of BRICS, they’re going to have to pay a 10% tariff,” he said.

Tariff letters

His announcement came a day after he sent letters to 14 countries reimposing higher tariffs on them effective from August 1. Then, on Wednesday, he sent similar letters to eight more countries. 

The recipients of these letters include three countries in the BRICS grouping — Brazil, South Africa, and Indonesia. Mr. Trump’s threat of a BRICS tariff is, therefore, causing some confusion among Indian policymakers.

In its letters, the U.S. threatened to impose import tariffs of 50% on Brazil, 30% on South Africa, and 32% on Indonesia. As per a trade deal agreed with China towards the end of June, the U.S. will impose 30% tariffs on Chinese imports.

‘Clarity needed’

“More clarity has to come from the U.S. side,” an official told The Hindu. “They have already sent letters to some countries, and have entered into an agreement with China, and now are saying they will impose additional tariffs on BRICS countries. Do the tariffs in the letters include this 10% additional tariff or not? How will a BRICS tariff affect India and the current proposed deal that is being negotiated?”

Apart from the letters to specific countries, Mr. Trump also announced a 50% tariff on all copper imports coming into the U.S. 

Another government official confirmed to The Hindu that India plans to seek additional clarity on this.

“We are engaged with the U.S. team virtually, and an Indian team will be heading to the U.S. soon,” the second official said. “Along with clarity on this, negotiations will continue on the mini deal as well as the overall Bilateral Trade Agreement (BTA).”

Trump’s unpredictability

This would be the third time that an Indian team of negotiators has travelled to the U.S. in the last few months to discuss the trade deal. A U.S. team has also travelled to India twice during this time. 

According to trade experts, these latest announcements call into question existing deals with the U.S.

“Trump’s unpredictability raises concerns that even signed deals may be revisited,” said Ajay Srivastava, former Director General of Foreign Trade and founder of the think-tank Global Trade Research Initiative. “Trump’s warning makes it clear: any country seen as aligning with BRICS positions may face new tariffs, regardless of previous deals.”