U.S. President Barack Obama has imposed a whopping 35 per cent additional import duty on Chinese tyres in a bid to protect the domestic market, drawing the ire of Beijing which described the measure as “protectionist'' and violation of WTO rules. The additional import duty would be in force for three years.

However, it would decline by five percentage points each in subsequent years. "The additional duty to passenger vehicle and light truck tires complementing the existing four per cent duty will be set at 35 percent ad valorem for the first year, 30 per cent ad valorem the second year, and 25 per cent ad valorem the third year,'' the White House said in a statement.

"In the context of the global economic crisis this sets a very bad example. China reserves the right to retaliate,'' a top Chinese official said in Beijing. Mr. Obama signed a presidential determination in this regard after reviewing recommendations from the United States Trade Representative (USTR).

"China is firmly opposed to this measure of serious commercial protectionism by the United States, which not only violates world trade rules but also the undertakings given by the U.S at the G-20,'' Commerce Ministry spokesman Yao Jian said in statements posted on the Ministry of Commerce website.

"The U.S. had violated the WTO rule by this decision and also relevant commitments made on the G-20 financial summit,'' the Ministry was quoted as saying by Xinhua.