Trump's Tariffs Are Rewiring the World Economy

India now finds itself at a crossroads. The tariffs expose structural weaknesses in its export ecosystem and supply chain reliance. But they also present a window of opportunity.

- SAVIO RODRIGUES

The 2025 introduction of sweeping tariffs by President Donald Trump has sparked more than just a trade dispute—it has triggered a tectonic shift in global economic dynamics. With a blunt imposition of a 10% blanket tariff on all imports and significantly higher duties targeting strategic partners such as China, the European Union, Japan, Vietnam, and India, Trump has reasserted an aggressive protectionist posture. While his stated intent is to boost American manufacturing and reduce trade deficits, the ripple effects of these tariffs have created economic aftershocks across continents—disrupting markets, unsettling supply chains, and testing the resilience of the interconnected global order.

FINANCIAL MARKETS IN FREEFALL The global financial markets were the first to signal alarm. The Dow Jones Industrial Average plunged by 3,910 points over 48 hours—its steepest drop since the early days of the COVID-19 pandemic. The S&P 500 and Nasdaq each slid nearly 6%, while Asian markets were battered even more severely: Japan's Nikkei 225 lost nearly 8%, Hong Kong's Hang Seng Index plummeted 12.4%, and the Shanghai Composite Index fell 8.4%. Collectively, global equity markets saw over $6.6 trillion in value erased in just days.

This wasn't just investor overreaction. It was a recognition of deeper systemic risks: disrupted trade flows, higher input costs, retaliatory tariffs, and a rising cost of capital in a world already battling persistent inflation. The very foundation of the post-war global trade architecture—built on predictability, efficiency, and interdependence—has come under strain.