The Tariff Tangle of Trump’s Trade War
Since returning to political prominence, Donald Trump has remained unapologetically aggressive on trade. Central to his “America First” doctrine is the imposition of steep tariffs on imports, which he frames as a corrective to years of alleged global exploitation of the U.S. economy. These tariffs, introduced as part of his sweeping reciprocal trade policy, have rattled markets, strained diplomatic ties, and triggered widespread fears of a global economic slowdown.
But in a surprising twist, President Trump announced a 90-day pause on his tariffs—for all nations except China. The move, abrupt and unexpected, left global observers wondering whether it was a tactical recalibration or a knee-jerk reaction to domestic market tremors. As the dust settles, one thing is clear: the world must prepare for more volatility in U.S. trade policy.
A Pause for Everyone but China: The Heart of the Announcement
On Wednesday, President Trump announced a temporary 90-day suspension of the newly enforced reciprocal tariffs for over 75 countries, citing their “non-retaliation” as the basis for this leniency. The revised tariff rate during this grace period would be a reduced 10%—significantly less than the original punitive levels.
China, however, remains in the crosshairs. Effective immediately, tariffs on Chinese goods were raised from 104% to a staggering 125%. Trump justified this escalation by accusing China of “disrespecting world markets” and continuing to “rip off” the United States and other countries. In a characteristically combative post on Truth Social, Trump proclaimed that China would eventually learn that such practices are “no longer sustainable or acceptable.”
Although Trump acknowledged that Beijing wants a deal, he claimed that Chinese President Xi Jinping and his administration are “too proud” or simply “don’t know how to go about it.”
What Prompted the Sudden Pause? Panic Behind the Policy
For weeks, business leaders and Republican allies had urged Trump to reconsider his aggressive tariff measures, warning that they could spiral into a full-scale trade war and trigger a global recession. Trump, characteristically defiant, resisted those calls—until internal tremors began to threaten the very foundations of the U.S. economy.
According to CNN, it wasn’t international pressure but concerns inside the Treasury Department that ultimately swayed Trump. Treasury Secretary Scott Bessent, alarmed by the sell-off in the U.S. bond market and mounting signs of investor panic, reportedly pressed the President to reconsider. Bond yields, a key indicator of economic health, had been flashing warning signs of a looming slowdown.
In his own words to the press, Trump admitted that the decision wasn’t part of a well-thought-out strategy. “It was written from the heart,” he said. “I thought that people were jumping a little bit out of line… They were getting a little bit afraid. You have to be flexible.”
The Global Market Reaction: Relief, Rally, and Recalibration
Wall Street’s response to the tariff pause was immediate and euphoric. The Dow Jones Industrial Average surged by over 2,500 points, an almost 8% rise in a single session. The tech-heavy Nasdaq jumped 12.2%, marking its best day in 24 years, while the S&P 500 also rallied by 6%.
The optimism spilled over into other markets as well. Oil prices climbed by more than 4%, and the U.S. dollar gained strength, reflecting renewed investor confidence. The tariff reprieve offered temporary relief to jittery markets that had been battered by days of declines and economic uncertainty.
What Nations Must Do: Time to Strategize, Not Celebrate
While the 90-day pause provides a welcome breather, it’s a narrow window of opportunity—not a resolution. Nations affected by Trump’s tariffs must use this period wisely. This means ramping up diplomatic engagement with U.S. trade officials, solidifying mutual interests, and navigating toward long-term trade pacts that can insulate their economies from sudden policy jolts.
For countries like India, the path is already in motion. India had been hit with a 26% customized reciprocal tariff under Trump’s original order. Now, with the temporary suspension, New Delhi has a vital chance to push forward trade negotiations.
Randhir Jaiswal, spokesperson for India’s Ministry of External Affairs, affirmed that talks between Indian and U.S. trade teams are ongoing. “We are in negotiations for a bilateral trade agreement,” he said, expressing optimism for a “mutually beneficial multi-sectoral” resolution.
Other nations must follow suit: diversify trade partnerships, reduce dependency on U.S. markets where feasible, and prepare contingency strategies should the tariffs return at full strength once the pause ends.
The International Response: Relief with Caution
The global reaction to Trump’s pause has been mixed. Many countries breathed a sigh of relief—but the suddenness and rationale behind the decision have left them wary. There is growing consensus among global trade analysts that Trump’s approach is impulsive and unpredictable, undermining long-term confidence in U.S. trade reliability.
China, meanwhile, remains firm. While Beijing has not issued a fiery response, state media and officials have reiterated calls for fair negotiations. Some experts believe the heightened tariffs could push China to further deepen trade ties with other global powers, including the EU and ASEAN nations.
Others warn that China could retaliate by targeting U.S. tech companies, agricultural exports, or rare-earth elements, escalating the conflict into new arenas.
A Fragile Truce in a War Still Brewing
Trump’s 90-day tariff pause is less a sign of reconciliation and more a moment of recalibration. Though markets rallied and nations exhaled, the decision stemmed from internal economic anxieties, not a shift in strategy or philosophy.
This moment should not be mistaken for peace—it’s merely a pause. To prevent future turmoil, the way forward must involve coordinated diplomacy, economic preparedness, and structural trade reforms that promote fairness without resorting to brinkmanship.
The world cannot afford to be caught off-guard again. Whether this fragile truce leads to lasting stability or reopens wounds in three months will depend on how wisely this time is used—and whether President Trump’s “heartfelt” decisions evolve into sustainable policy.
(With inputs from agencies)
