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Abstract

is research examines the impact of the reciprocal tariffs introduced by the protectionist administration between 2020 and 2024 on the economies of India, China, and Canada. These tariffs were part of a broader shift in U.S. trade policy aimed at reducing trade deficits and encouraging fairer trade practices. However, the retaliatory nature of these measures led to trade tensions with several key U.S. partners. By focusing on India, China, and Canada—countries with different economic structures and levels of trade dependence on the U.S.—this study highlights how each nation was affected in unique ways. China, as the largest target of the tariffs, experienced a significant decline in exports to the U.S, disruptions in its manufacturing and technology sectors, and broader economic slowdowns, particularly in global supply chains. Canada, though a close economically of the U.S., faced tariffs on steel and aluminum, which negatively impacted its industrial output and led to retaliatory tariffs on American goods. This briefly strained U.S.-Canada trade relations and pushed Canada to strengthen trade ties with other global partners. In India’s case, although the economic impact was smaller, the country responded with its own tariffs on U.S. products and saw shifts in its trade policy stance, aiming to reduce dependence on any single trading partner. The research uses a mix of economic data—including GDP growth, trade volumes, and sector-level performance—alongside policy analysis to understand how each country adapted to the changing trade environment. The findings show that while the tariffs were meant to protect U.S. industries, they caused unintended economic disruptions and forced other countries to rethink their trade strategies. The study concludes that unilateral tariff measures, especially when used against major trading partners, can have far-reaching global consequences. It emphasizes the need for more cooperative and balanced trade policies to ensure economic stability and long-term growth for all involved nations.

Keywords

Economic Effects, U.S. Reciprocal Tariffs, India, China, and Canada

Introduction

1.1 Background and Motivation

In recent years, the global economy has been greatly shaped by tariffs and trade barriers, especially during former U.S. President Donald Trump’s administration. The tariffs imposed during this time led to various trade disputes that impacted not just the United States but also important trading partners like India, China, and Canada. This study aims to understand the wider effects of these tariffs on the economies of these countries. As nations deal with the fallout of protectionist policies, it is crucial to examine how these measures influence economic indicators such as GDP, trade balance, and employment.

1.2 Research Objectives and Hypothesis

The main goal of this research is to assess the economic impact of the tariffs imposed by the Protectionist administration on India, China, and Canada. This study will examine how these tariffs have affected GDP growth, trade balances, and employment rates in the countries involved. The main hypothesis suggests that the implementation of these tariffs has resulted in a noticeable drop in key economic performance indicators in these nations, with varying levels of impact depending on their specific economic structures and trade relationships.

1.3 Significance and Contribution Of The Study

This study is important in today's trade landscape. It aims to address the gap in existing research about how reciprocal tariffs affect both emerging and developed economies. By analyzing the economic effects of these tariffs, the research helps us better understand the implications of trade policies. It also provides useful insights for policymakers. Additionally, the findings may guide future trade negotiations and strategies, emphasizing the need to consider the economic effects of imposing tariffs.

1.4 Paper Structure and Overview

The paper is organized to provide a detailed look at the topic. It starts with a literature review that sets the stage by discussing the history and theories related to tariff policies and trade wars. Next, it will develop the theoretical framework and hypothesis, clearly stating the expected connections between tariffs and major economic indicators. The methodology section will explain the data sources, statistical methods, and analytical techniques used in the study. Following that, the paper will examine the specific effects of tariffs on India, China, and Canada. This will lead to a comparison across the countries. The results will be presented and discussed in the context of global trade relations. Finally, the paper will summarize key findings and their implications for future research.

Reference

11.1 Academic Journals and Scholarly Articles

  1. • Theoretical Frameworks and General Tariff Impact 
  2. o The Impact of the 2018 Tariffs on Prices and Welfare. 
  3. o The Economics of the World Trading System. MIT Press. (A foundational text on trade agreements and disputes). 
  4. o The return of industrial policy. American Economic Review: Insights, 2(2), 173-89. 
  5. o Clashing over Commerce: A History of US Trade Policy. University of Chicago Press. (Provides historical context for tariff policies). 
  6. o Is Free Trade Passe? Journal of Economic Perspectives, 5(2), 131-144. (Classic on the benefits and debates around free trade). 
  7. o Magee, S. P. (1976). International Trade and Distortions in Factor Markets. Marcel Dekker. (Seminal work on the effects of trade policy). 
  8. o The Trade War: How Tariffs Impact Global Value Chains. UNCTAD. (A report offering a broad perspective on GVC disruption). 
  9. o The US-China Trade War: A Global Value Chain Perspective. Journal of Economic Integration, 35(1), 1-27. 
  10. • Specific Impact on India 
  11. o Srivastava, U. K. (2024). A Study of Global Trade War and Its Impact on Indian Economy. International Journal for Multidisciplinary Research (IJFMR), 6(2), March-April 2024. (Crucial, as you identified this as a recent paper). 
  12. o India’s Trade Policy Responses to Global Protectionism: A Sectoral Analysis. South Asian Journal of Macroeconomics and Public Finance, 10(1), 45-68. 
  13. o Mehta, P. S., & Sharma, D. (2019). India in the US-China Trade War: Challenges and Opportunities. Economic & Political Weekly, 54(10), 20-25. 
  14. o Look for newer articles on agricultural and pharmaceutical trade dynamics with the US after the 2024 tariff announcements. Check journals like Indian Economic Review, Foreign Trade Review. 
  15. • Specific Impact on China 
  16. o The US-China Trade War and Global Supply Chain Restructuring. Asian Economic Policy Review, 15(1), 127-147. 
  17. o The US-China Trade War: How Should China Respond? China & World Economy, 28(2), 1-28. 
  18. o The impact of the China-US tariff war on China and China's countermeasures. (2025). 
  19. o The Impact of US Tariffs on China's Export Performance: Evidence from Firm-Level Data. Emerging Markets Finance and Trade, 57(11), 3121-3136. 
  20. • Specific Impact on Canada 
  21. o The Tariffs War between U.S. vs. Canada: Winners and Losers. (2025, March 21). Research Gate. 
  22. o US Trade Policy and the Global Trading System: Threats to Multilateralism? The World Economy, 41(9), 2379-2401. 
  23. o The USMCA and the Future of North American Trade. C.D. Howe Institute Commentary, 563. (Focuses on the broader trade agreement but has implications for tariffs). 

11.2 Reports And Analysis From International Organizations

  1. • International Monetary Fund (IMF) 
  2. o International Monetary Fund World Economic Outlook: The Global Economy Enters a New Era. Washington, D.C. This report is essential for the latest growth forecasts and tariff effects. 
  3. o International Monetary Fund World Economic Outlook Database https://www.imf.org/external/datamapper/index.php This site provides raw data on GDP, trade balance, and more. 
  4. o International Monetary Fund. Country Reports for India, China, and Canada. 

• World Trade Organization (WTO) 

  1. o World Trade Organization World Tariff Profiles https://www.wto.org/english/tratop_e/tariffs_e/tariff_profiles_e.htm 
  2. o World Trade Organization Trade Policy Reviews of the United States, India, China, and Canada. 
  3. o World Trade Organization. Dispute Settlement Body (DSB) Reports. 

• Think Tanks and Research Institutes 

  1. Trump's Trade Wars: A Timeline. Peterson Institute for International Economics (PIIE). This analysis is updated regularly on the PIIE website. 
  2. o Center for Macroeconomics and Development The Global Impact of President Trump's Reciprocal Tariffs: Implications for Developing Countries. This is a very recent and relevant report you found. 
  3. o The Impact of Trump's Tariffs: A Detailed Analysis. CLA Insights. 
  4. o Penn Wharton Budget Model the Economic Effects of President Trump's Tariffs. This report is crucial for estimates on US economic impact. 
  5. o Union Bank of India (UBI) Research Trumponomics and its impact on India. 

Government Publications and Official Data

United States Government Data

  1. United States International Trade Commission (USITC) DataWeb: U.S. Trade & Tariff Data. https://dataweb.usitc.gov/
  2. United States International Trade Commission (USITC). USITC Releases Second Report on the Economic Impact and Operation of the USMCA Automotive Rules of Origin. (Specific to Canada-US auto trade).
  3. US Census Bureau. Foreign Trade Statistics. https://www.census.gov/foreign-trade/
  4. U.S. Department of Commerce, Bureau of Economic Analysis (BEA). National Economic Accounts. (For US GDP, employment data).

Indian Government Data & Policy Documents

  1. NITI Aayog Promoting India-US Agricultural Trade Under the New US Trade Regime.
  2. NITI Aayog. NITI Aayog lays out blueprint for chemical sector to enhance India’s global competitiveness.
  3. Ministry of Commerce & Industry, Government of India. Trade Statistics.
  4. Reserve Bank of India (RBI). Annual Reports and Publications.

Chinese Government Data & Policy Documents

  1. National Bureau of Statistics of China.  Statistical Communiqués on National Economic and Social Development.
  2. Ministry of Commerce of the People's Republic of China. Official Trade Statistics and Policy Announcements.

Canadian Government Data

  1. Statistics Canada. Canadian International Merchandise Trade. (Accessed: July 6, 2025). https://www150.statcan.gc.ca/n1/daily-quotidien/250703/dq250703a-eng.htm
  2. Statistics Canada. Labor Force Survey. (For employment data).
  3. Global Affairs Canada. Trade Agreements and Negotiations.

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S. Swetha
Corresponding author

K. R. M. Public School, Chennai

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Sahayaraj Antony Michael
Co-author

K. R. M. Public School, Chennai

S. Swetha*, Sahayaraj Antony Michael, A Comparative Analysis of The Economic Effects of U.S. Reciprocal Tariffs on India, China, and Canada, Int. J. Sci. R. Tech., 2025, 2 (11), 173-188. https://doi.org/10.5281/zenodo.17557551

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