Trump Has Jolted India Out of Its Complacency

Structure ranged from 5 percent to 28 percent.

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While the tariffs may eventually be rolled back by Mr. Trump himself, or even declared illegal by the US Supreme Court, these reforms will endure. That raises expectations that the 7.8 percent GDP expansion recorded in the April to June quarter may resume after a widely expected tariff-induced slowdown in the second half of 2025.

The reset of China ties also could presage a surge in Chinese capital investments through the joint venture route, as firms like BYD seek to tap into the expanding Indian market.

All that has helped India maintain much of its swagger amid the Trump difficulties. The benchmark Sensex ticked up on news that the US and India are poised to earnestly conclude trade talks, and is up nearly 10 percent for the past six months.

Mr. Christoph Schweizer, CEO of Boston Consulting Group, said he recently returned from a trip to tariff-struck India that was "brimming with optimism and ambition" as it heads towards being a US$7 trillion economy by 2030, from just over US$4 trillion now.

While some 14 percent of India's overall trade is indeed affected by the tariffs, it has been improving access to other markets through agreements, for example, with Australia and the UK, he noted. And it also will trade more with Asean, West Asia and Africa.

As for long-term challenges, such as AI and automation, he believes India is well-positioned for those as well.

"In my conversations with CEOs, I noticed that Indian companies have two other strengths that matter for AI. These are a healthy skepticism that ensures AI investments will achieve a healthy return on investments, and secondly, once they decide to invest, they have the ability to move fast and change how employees deliver their work."

Not just the recent Trump-induced measures, a look at some key events would suggest that it has generally performed well when under pressure.