A double whammy.

"Canada, Mexico and China have vowed to respond to sweeping new tariffs to their exports to the US announced by President Trump," as "Trump said a levy of 25% on Canadian and Mexican imports as well as a 10% tax on Chinese goods will come into force on Tuesday (tomorrow)." BBC. "The dollar soared, oil prices spiked and stock markets fell," and "US Treasury yields went up, while stock futures dropped and a key index tracking shares in the Asia-Pacific region also fell in response to these measures." "The dollar's rise is driven by the expectation that tariffs will increase inflation, keeping US interest rates high." FE. "President Donald Trump's new tariff orders against Canada, Mexico and China all contain clauses suspending a duty free exemption for low-value shipments below $800 that is widely seen as a loophole that has allowed shipments of fentanyl and its precursor chemicals into the US." The Print. However, unless this exception is suspended globally drug gangs will find other routes. In a big sigh of relief, Trump "did not name India in the first set of tariffs" (HT) even though he says, "India's tariffs - taxes on imports - are 'unacceptable', and has described India as the 'king' of tariffs." "India's average tariff rate in 2018 was 17.1% - that is significantly higher than the US, Japan and the EU, all of whom had rates between 3.4% and 5.2%." Turkey's was at 10,7%, Brazil's was 13.4% and only Egypt was higher at 19.1%" (BBC). As a preemptive namaskar to Trump, "India has significantly slashed customs duties on high-end motorcycles, cars and smartphone parts, a move that seems to give a boost to American companies like Harley-Davidson, Tesla and Apple." "However, according to Finance Minister Nirmala Sitharaman, custom duty rationalisation was introduced to ensure the Indian economy becomes aatmanirbhar (self-reliant)." NDTV. Trying to be self-reliant does not protect the economy, as "The Indian rupee weakened past 87 per US dollar for the first time today, as Asian currencies slumped," and "The rupee dropped 0.5% to a low of 87.07 in early trade, with traders expecting the currency to face further losses during the day." Reuters. In 2023-24, "India imported 232.5 million tonnes of crude oil," as "Import dependence soared to 87.7% in 2023-24, up from 87.4%, according to PPAC." ET. A weaker rupee will increase the cost of imported crude. If the increase is passed on to the retail price of fuel, it will immediately increase transport costs and add to inflation. If, on the other hand, the retail price is kept at the same level by reducing taxes, the government will lose revenue. "Petrol tax in India consists of 55% of petrol's retailing price while diesel tax is 50% of the fuel's retail value." cleartax. The Congress Party accused the government of raking in Rs 36 trillion from taxes on petrol in the last five years. ET. Just because it is an opposition party it does not mean they are totally wrong.  Exaggeration maybe, but not a lie. FM Sitharaman said that the rupee "depreciated only against a strengthening US dollar but remained stable against all other currencies. BS. India's Real Effective Exchange Rate (REER), with 2005 as the base year, was 117.8 in Dec 2024. CEIC. An overvalued rupee makes exports more expensive. So, we get high inflation from the US and lose exports to the rest of the world. Canada, Mexico and China lose once, we lose twice. That makes it a 'double whammy' (Britannica).