‘Trump Has Proved Himself To Be An Untrustworthy Partner’
Joy Ghosh, an entrepreneur and founder of a tech-based initiative, says the US President has lived up to his image of kicking up chaos across the world market. His views:
By doubling duties on Indian goods and threatening about $50 billion worth of exports, Trump is only trying to arm-twist India to manipulate the amount of crude oil India is exporting from Russia. The move is clearly a part of Washington’s so-called penalties on India for buying cheap crude oil and military equipment from Moscow and, in essence, helping Russia sustain its war against Ukraine. Besides India, Brazil is the only nation which is facing such unjustified sanctions, for similar reasons.
The new tariffs on India are going to impact mostly the labour intensive and high-value export sectors such as textile & apparels, gems & jewellery, shrimps, carpets & handicrafts, agri-food, metals & chemicals and machinery. Indeed, it has sent visible shock waves on the markets and our stock index.
Thus while 66% of India’s exports to the US ($60.2 billion) will now face the 50% tariff, about 3.8% of exports ($3.4 billion), primarily auto components will also face a 25% tariff and the remaining 30.2% of exports ($27.6 billion) will continue to enter the US market duty-free.
The levy is not only “prohibitive”, driving many Indian goods out of the US market but it has already stopped the US customers to place new orders. With these tariffs coming in effect, the exports could well start coming down by 20 to 30 per cent from next month as exporters see limited scope for diversifying or moving to other markets or selling in the domestic market.
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Whatever America is doing today has been a part of its age old diplomatic tradition of arbitrary and transactional dealings. The problem is that President Donald Trump is seen taking two steps forward, three steps back and a few steps to the right and left, spreading chaos and confusion in most parts of the world.
In India’s case, these tariffs will not only wipe out our competitiveness in the largest export market but it will also threaten billions in exports and thousands of jobs. We, as Indian businessmen, are not left with many versatile options to handle this at present – as they are only concentrated on negotiating or diversifying export markets, offering more concessions, etc. It is also rightly said that in an era of using economic power as a weapon, survival is not limited to avoiding confrontation but to finding newer opportunities to counter the threats.
The crux of the entire situation is that if heads of states start acting arbitrarily in international relations, then whether enemies are scared or not, friends definitely start moving away. The way Trump is behaving with countries like India, Brazil and South Africa, Brazil and South Africa are looking at America as a suspect. It is also possible in the coming days that BRICS may strengthen the coordination between the member countries further, decreasing the dependency on dollar in future trades.
While Trump says this is punishment for India’s purchase of discounted oil from Russia, which he argues helps fund Russian president Vladimir Putin’s war on Ukraine, India is the only major economy to be hit with such “secondary tariffs,” even though China is the largest overall buyer of Moscow’s crude. At the same time, Trump’s tariffs have opened the door for closer India-China ties and other BRICS countries to take major steps to rejuvenate their economies with stronger inter-circle trade bonds.
As told to Rajat Rai
