Trump's Tariff Tantrums & India's Response

India can better navigate the dystopia unleashed by Trump by following the Chinese model of becoming a global manufacturing hub and investing in education, skills, and technology, says Satya Narayan Misra

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GLOBAL economic crises have a way of leaving behind many lessons that are often followed up with systemic improvements. And sometimes, countries are befuddled about how to respond, as in the case of Trump's tariff tantrums.

The fiscal stimulus by FDR to resuscitate the US economy from the quagmire of depression in the 1930s was replicated by almost every country when the pandemic hit the world. The East Asian crisis of 1997, due to the unregulated flow of capital, made many developing economies like India wary of embracing full convertibility of their currency. The Subprime Crisis of 2007-2009, which busted the myth that big banks do not fail, made countries more cognizant of the importance of properly regulating banks. But how does one deal with the tariff tantrums of Trump? Should one retaliate against the USA with high tariffs like China, or demurely wait and watch like India? A man-made crisis seems to have bamboozled the best of analysts.