Asymmetrical trade: Beware its political consequences

The year that’s drawing to a close will be remembered as the point at which US President Donald Trump overturned the global trading system that had been in place since World War II.

- NIRANJAN RAJADHYAKSHA

India has been a major target of Trumpian whimsy. It is now hard to believe that the world will go back to the old multilateral trading system even after Trump exits office. We are in untested territory, with all its inherent uncertainties.India’s big question is how best to adapt to the evolving global arrangements, with the worrisome prospect of rising protectionism, militarism and regionalism. The government is busy trying to close a trade deal with the US and has voices within that want the country to join at least one of the regional free-trade agreements that we have assiduously stayed out of. Are there any relevant lessons from the past?

In that context, one book written at the end of World War II deserves to be read again. The theme of Albert Hirschman’s National Power and the Structure of Foreign Trade (1945) is inseparable from his early political life. Before becoming one of the 20th century's most original political economists, Hirschman played an active role in resistance to Nazism. A German-born Jew who fled Hitler's Germany, he fought in the Spanish Civil War, then worked with the French Resistance against fascism. He helped smuggle hundreds of anti Nazi intellectuals and artists out of Vichy France.