Missing competitive edge

The global economy is facing significant headwinds due to the uncertain tariff policies of the US administration under Donald Trump.

- PRERNA PRABHAKAR, SANJAY KATHURIA & TG SRINIVASAN

These policies build upon the protectionist stance adopted during his first term, particularly targeting China.

Amidst this evolving landscape, India finds itself at a critical juncture, facing both challenges and opportunities. One concern is the possibility of Chinese exporters diverting excess supply to markets, potentially undercutting Indian exporters through aggressive pricing and dumping, and posing a challenge to Indian suppliers in their home turf.

Although India did not benefit much from the first round of the US-China trade wars that began in 2018, could it position itself better this time to benefit from the ongoing shifts in global trading patterns?

To achieve this, India must address structural inefficiencies and reform its policy and regulatory frameworks, as underscored by a recently released Competitiveness Index that ranks India as the least competitive among key Asian peers—raising concerns about its readiness to capitalize on the shifting global trade dynamics. Malaysia, Vietnam, and Thailand demonstrate strong competitiveness fundamentals and top the index rankings.

The index offers a forward-looking snapshot of export potential, measuring six core pillars of competitiveness—and India falls short on most, signaling deeper challenges in scaling up its global trade game.