After the recent criticism by former U.S. President Donald Trump, targeting high import duties on Indian products would therefore lead to some drastic disruptions in global trade and hence economic stresses on Indian industries. If he returns to his protectionist policies, unlike the one he usually uses to rail against India such as with “the tariff king,” India’s exports—concentrated on pharmaceuticals, information technology, textiles, and automobiles—are going to face real-time challenges.
During his administration, he withdrew from India the GSP status that protected it from high import duties. He also imposed tariffs on India, pressuring it to lower duties on U.S. goods. If he returned as president, there would be more aggressive trade choices that would jeopardize India’s ability to access the markets of the U.S.—its chief commercial partner.
From the perspective of India, the upsurge in tariffs may put a halt on its ‘Make in India’ initiative job creation and foreign exchange earnings. He imposes higher import duties on U.S. goods, the costs escalate for Indian businesses dependent on American technology and raw materials. This scenario would further harm India’s industrial growth and competitiveness.
Politically, intensifying trade hostilities could undermine the collaborative endeavours between India and the U.S. in defence, technology, and the renewable energy sector. Global trade stability could suffer equally if procurements from other nations retaliate, which would unavoidably cause supply chain ruptures and market instability.
In such a situation, India might seek to redeem trade arrangements with the EU, ASEAN, and BRICS and fortify domestic manufacturing to lessen the risk, however, that would usually take time since one cannot reconsolidate trade arrangements at a snail’s pace, and one fears for short-term economic upsets. As both sides go on to trade impasses, India’s relationship with the U.S. depends on how fast they engage in talks due to subsequent economic policies in the future.
Edited By Saumya Sharan
