Harley Davidson bikes are slowly becoming the bone of contention for the India and USA. The story began with Indian government levy of taxes to the tune of 100 percent.
The Harley came under Parley:
The American major and male heartthrob was slapped with a 100 percent tax duty. After Mr Trump decided to take things into his stride, the Indian government decided to quash the tax to 75 percent.
The story took a turn for worst and the American government threatened to impose a reciprocal tax (eye roll) to promote the disparity between the imported good and indigenous products. The trade account was stated to be already deficit by 80/ billion dollars. The president expressed his displeasure at the step-motherly treatment meted out the American exports to India.
In order to save their relationship with the USA, the Modi Government made a courtesy call to the Trump administration. It is stated that an offer to reduce the amount by half was given only to be met with disdain from the USA government. Mr. Donald Trump’s speech shocked the world with his hidden figures stated in bad taste.
The video was the result of a recent attempt by Indian administration to mend the relationship with the superpower.
The president of the States has blamed India for becoming rich by using special taxes imposed on American exports. He explained that the equity in business relationships is a must. Hence his nation would try to impose special taxes. If this is to be believed, the Indian market will attract 25 percent tariff to sell their goods.
The president went on to add a rebuff on Mr Modi and India’s discrimination against the USA. As the friction is taking its toll on the bilateral trade, let’s understand why is USA’S threat so seemingly hard on the country.
- The Indo-US trade was pegged at 115 billion dollars in 2016.
- The US buys from the nation a fifth of its goods and services.
Such a trade initiative is praiseworthy for local trade and job market and is aimed to lend a rocket launch to the GDP success meter. But for the export extensive sectors, the move may become backbreaking. WTO states that India receives 13.5 percent tax on the imports while China manages to scrape only 9.9 percent.
The EU Link:
Apart from India, EU trade unions have been taking US goods into tax consideration. A tax levy of 25 percent is the quoted rate. This means top US brands like Levi’s, bourbon, Jack Daniels, etc. Are soon to become expensive. This means that the US brands suffer in EU.
Hence, the present president decided to take matters into his hand. The threat of taxes attracted the reciprocal tax regime from EU.
But why Harley Davidson?
It raises a common issue as to why the president prefers the Harley Davidson and the performance in other countries.
It is thought that the Harley Davidson represents the true story of an all American brand. Despite the flaws, it has been exponential in reaching out to the masses. (In a way similar to the Trump government).
Do you think that the Trump administration is making a winning streak for its nationals? Share your views in the comments section below: