Trade Analysis

India Gained From Trade War Between US, China

Published: April 10, 2023

According to a research by the UN trade and investment authority, India increased its exports to the US by around $755 million in the first half of 2019 due to the trade diversion impacts of Washington’s tariff war with China. These shipments were primarily of chemicals, metals, and ore.

The ongoing US-China trade war has caused a sharp decline in bilateral trade, higher consumer prices, and trade diversion effects, such as an increase in imports from nations not directly involved in the trade war, according to the study Trade and Trade Diversion Effects of United States Tariffs on China.

The study estimates that the US-China tariff war will have a $21 billion trade diversion effect in the first half of 2019, indicating that there would be net trade losses. equivalent to almost $14 billion

The data demonstrates that US tariffs resulted in a 25% export loss, costing Chinese exports in the US market for tariffed items $35 billion in the first half of 2019. This data also demonstrates the competitiveness of Chinese businesses, which kept 75% of their shipments to the US despite the high taxes. The tariffs were raised by the US to 25% in June 2019. China’s response was to increase the duties on a selection of the already tariffed goods. For a sizable portion of the $300 billion in Chinese imports that were still exempt from tariffs as of September 2019, the US applied 15% duties.


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