Trump's new term is an opportunity for India - Dr. Jayantilal Bhandari
On January 20 , Donald Trump said in his first address after taking oath as the 47th President of America that now the golden era of America is starting. America will again become a rich country. America will again become a manufacturing hub and to make American citizens rich, taxes and tariffs will be increased on the products of other countries. Trump's new economic strategy is becoming visible in his new term. It is worth noting that after taking oath, Trump took new economic decisions and said that if the use of dollar by BRICS countries in global trade is reduced then 100 percent tariff will be imposed on BRICS countries. Trump did not say anything that would have any adverse effect on Indian economy. Trump this time The President appears to be twice as economically powerful . Trump has already in his speeches clearly indicated that While his new economic strategy includes increasing import duties to realize the dream of a prosperous America , it also includes controlling the economic dominance of China, which is challenging America by creating turmoil in the changing world, through trade restrictions and high duties. Trump has first indicated to impose high import duties on the top five-six countries, including China , Canada , Mexico , with whom America has the highest trade deficit. Tough economic decisions on these countries will be beneficial for India. Since Trump has also called India a country with high import duty on some products , India will get more opportunities to export to America if India reduces duty on some products in the larger interest of America. US Ambassador to India Eric Garcetti has said that the economic relations between India and America will be strengthened further with Trump's arrival. Prime Minister Narendra Modi, while congratulating Trump after his swearing-in, has given the message of working together in each other's interest. In such a situation, economic opportunities are emerging for India even amidst Trump's economic challenges.
Undoubtedly, in his second term, Trump has given high priority to the concept of ' My America First ' instead of globalization and has indicated America's move towards self-reliance and economic strength instead of interdependent economies. A big reason for this is that the economic - business rules , agreements and cooperative agendas that were made at the global level after the Second World War , all seem to be collapsing at this time. Especially China has not followed the accepted global business rules. China has not only strategically worked to end the industrialization of the West , but it has also stolen many new technologies of the West. On the basis of these, China's dominance is increasing. In 2024, America has had the highest trade deficit with China. The situation is that by the year 2030 , China's manufacturing sector is estimated to be more than the manufacturing sector of the entire West. In this context, it is also noteworthy that last month in December 2024, at China's annual Central Economic Work Conference (CEWC), a new economic strategy was formulated to compete with America by discussing some notable points created by the challenge of Trump becoming the President. Under this, the path of a bigger economic stimulus has been chosen while accepting the stagnation in demand in China , worsening external economic challenges and the continuous slowdown in the Chinese economy. A consensus has been reached on ' liberal monetary policy ' .
It is worth mentioning here that in view of Trump's new tenure, international rating agencies have predicted that the new US President Trump may cause huge losses to China and ASEAN countries including India will benefit. Moody's Ratings says that India and other Asian countries are expected to benefit due to the increasing tension between the US and China and possible investment restrictions in strategic sectors. It has been said that in the Asia-Pacific region , trade and investment flows may move further away from China , as the US is tightening investment in strategic sectors , which will have a negative impact on China's economy. Similarly, according to the recently published new study report of the research unit of State Bank of India (SBI), although India will also not remain unaffected by President Trump's economic policies , but in the long run these policies will have a positive impact on India. India's economic opportunities will increase and especially after Trump, the Indian rupee will be seen continuously strengthening.
According to foreign trade experts, Trump's policy can further strengthen India's stock market. Many foreign companies manufacturing in China can also turn to India. India has so far got limited benefits from adopting the China Plus One strategy , but this benefit can be seen increasing in Trump's new term. At the beginning of Trump's new term, India is likely to finalize and implement the Free Trade Agreement (FTA) with America. This will increase India-America trade and India can also be seen moving forward as a global supplier country by increasing exports to America. Along with all this, the multifaceted chapters of friendship between Modi and Trump from Howdy Modi to Namaste Trump will be helpful in increasing India-America trade.
Global economists are also of the opinion that the ever-increasing trade between India and the US is likely to increase further in Trump's new term. In the financial year 2023-24 , bilateral trade of goods worth about $ 120 billion took place. In the year 2024, between January and June 2024 , America is becoming India's largest trading partner as well as the largest market for India's US exports and is being highlighted as the most prominent export. Last year also, the trade balance with the US has been in India's favor and this surplus is at the level of $ 35.3 billion. Other new study reports, including the Research and Information System of Developing Countries (RIS), are saying that opportunities are visible for India amidst challenges in Trump's new term. During Trump's first regime, India could not take advantage of the strictness against China. In such a situation, after Trump takes over the reins of the US administration, India will have to move forward on such a multi-dimensional strategy , which can increase exports to America on the one hand , and on the other hand can also give a sharp increase in global exports.
There is no doubt that India can easily increase its exports in many of the sectors in which China exports to the US . These sectors include electronics , electrical equipment , mobile phones , footwear , textiles and garments , furniture and home decor items , vehicle spare parts , toys and chemicals etc. For this, it will be necessary that the marketing plan specially suggested by the Association of Indian Exporters should be approved to increase the access of Indian exporters to the US market. Marketing incentives will help exporters to participate in exhibitions held in different parts of the US and tap the potential of new emerging exportable sectors in the US.
We hope that now when Donald Trump has indicated to increase the duty on some Indian products along with imposing maximum duty on China, Canada and Mexico to rebuild America in his new tenure, it will be beneficial for India to move forward with a strategy of appropriate reduction in duty on products of America's wider interest. In such a situation, opportunities for increasing more exports to America and more exports at the global level in view of China Plus One will be seen coming into India's hands. We hope that the new economic chapter written by Trump will lead to a new era of India-US economic relations and strong economic relations with America will also prove helpful in achieving the goal of making India a developed country by 2047.
( The author is a renowned economist.) Dr. Jayantilal Bhandari- 111, Gumasta Nagar , Indore- 9 Mo. 9425478705 ( Phone- 0731 2482060, 2480090)
