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Trade, tariffs and India's silver lining
April 22, 2025
|Hindustan Times Jaipur
CHATTERJEE SAID INDIA'S INTERESTS WOULD BE BEST SERVED BY TRADE LIBERALISATION—IRRESPECTIVE OF WHATEVER THE US DECIDES TO DO
NEW DELHI: On April 2, the Donald Trump administration announced a host of sweeping tariff hikes with every single one of America's trading partners. The aim of the so-called "Liberation Day" tariffs was ostensibly to "rebalance" the global trading system, as some Trump advisors have put it.
However, the drastic measure roiled markets and eventually resulted in Trump imposing a 90-day pause on most tariffs, except for strategic sectors and imports from China. India, for its part, was slapped with a 26% tariff even as top officials were negotiating a bilateral trade agreement with their American counterparts.
While the fate of future tariffs and any side agreements are unknown, the episode raises serious questions about India's global economic strategy. According to economist Shoumitro Chatterjee, India's best option is to bring down tariff barriers and make policy stability its calling card. Chatterjee elaborated on his assessment on a recent episode of Grand Tamasha, a weekly podcast on Indian politics and policy co-produced by HT and the Carnegie Endowment for International Peace.
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